Romalpa clause

What is a retention of title (ROT) clause?

In commercial transactions involving the sale of goods, including intellectual property (IP), a seller should consider protecting themselves against the risk that a buyer may default on payment.  In Queensland, one such protection method is provided by section 22 of the Sale of Goods Act 1896 (Qld) (SGA), which states that a seller may reserve the right to transfer title to the property.  At common law, such a clause is known as a Romalpa clause after the case of Aluminium Industrie Vaassen BV v Romalpa Aluminium Ltd [1976] 2 All ER 552 (Romalpa case). [Read more…]

Purchase Money Security Interests (PMSIs) and super priority

The general rule for resolving competing security interests is, in a general sense, first in best dressed.  In other words, a perfected security interest will take priority over all other security interests perfected after it.  There are of course certain exemptions to this principle, with one major exemption being the “super priority” enjoyed by purchase money security interests (PMSIs). [Read more…]

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