Report No. 20

Clause 10

Section 9 of the English Act deals with the question of appropriation of payments made by a hirer when he has entered into successive agreements of hire-purchase with the same owner. The section enables a hirer to appropriate his payments towards the agreements in such manner as he decides so as to enable him to save some of the goods at least, if he cannot save all of them.

The clause under discussion follows this section. The wording, "the sum shall stand appropriated" has been used for clarity.

One important change, however, as compared with the English Act is, that while under the English Act in the absence of appropriation by the hirer, the payments are appropriated towards the sums due under the various hire-purchase agreements in the proportions which those sums bear to one another, under the draft proposed the amounts would be appropriated in the order in which the agreements were entered into. This is considered to be more fair to the owner and follows section 6 of the Hire Purchase Act, 1958 of Western Australia (55 of 1958).

It is considered unnecessary to incorporate the further refinements appearing in section 61 of the Indian Contract Act, 1872, regarding (i) limitation and (ii) situations where the amounts are of equal standing.