Is it theft if goods are invoiced by supplier?

capinpugwash

My daughter bought a horse from a horse trader, and received the passport together with a receipt.

The horse was originally supplied to the trader by another horse dealing business together with a vat invoice, and the terms of the supply were that payment to the horse dealing business was to be made when the trader sold the horse.

The invoice to the trader also stated that the agreement was to be reviewed after 3 months and could then be extended or the horse returned to the horse dealing business.

My daughter bought the horse 7 days after the 3 months were up.

The trader from whom my daughter bought the horse never paid the invoice to the original horse business and the original horse business reported the horse as stolen to the police, who are now saying my daughter must return the horse as it has been stolen.

I believe that my daughter obtained the horse legally, and not as stolen goods, and that the original horse business that raised the invoice must look to the trader for the money by way of non payment of the invoice.

The police are saying that they will be prosecuting, but I belive that this is a civil and not criminal matter.

Who do you think may be right?

Stuart

4743hudsonj

I think that you are wrong. TBH i wouldnt class it as classic theft but if thats how its reported and the police are taking it serious enough to prosecute then i suppose it must be.

As with any other case of "stolen" goods the original owner gets their property back, and it is up to the person at the end of the chain to then pursue their money via civil procedures. So you need to give back the horse and then ask(then sue) for your money back from the trader.

Either way i wouldnt sweat it, just remember its the traders fault not the suppliers.

JasonLVC

I agree with 4743.

The title to the Horse never transferred from original owner to the trader you bought from. As the trader you bought from didn;t have title to the goods, they weren't his to sell to you.

Horse has to go back to original owner and you will have to sue the trader you bought the horse from to get your money back.

Not fair, but an invoice simply proves you paid someone for something, it doesn't mean they had the right to sell it to you.

If you buy a stolen car in good faith, you still lose the car and the money and have to sue for your cashback from the seller....who may or may not be in prison by then for theft.

Hintza

Or alternatively reach an agreement with original trader to buy the horse and proceed to recover the original purchase price.

capinpugwash

I may not have explained things fully.


The goods (i.e a Horse) were supplied bt Trader 1 and invoiced to Trader 2 on 29 July 2009,


This invoice was raised with a VAT number and related to a transaction between two trading businesses.


The invoice was under an arrangement that is quite common within retail, called a Pay on Sale invoice. This means that the invoice is only due for payment when the goods (horse) are sold.


The invoice also allowed for another common practice within retail called Sale or Return, whereby the retailer (Trader 2) may return the goods for full credit or refund if the goods fail to sell.


The invoice allowed for the goods to be continued to be offered for sale by Trader 2 after the initial 3 months as part of the pay on sale/sale or return arrangement.


Trader 2 sold the goods to my daughter under a business to consumer sale on 8th November, after she initially viewed the horse on 31 October,


Trader 2 provided a receipt for the money paid by my daughter and also handed over the Horse Passport, previously supplied to Trader 2 by Trader 1. Ownership then passed to my daughter I believe.


Trader 2, acquired ownership at the exact point and time of the sale to my Daughter by virtue of the Pay on Sale invoice, and thus was legally entitled to sell the horse to my daughter.


My Daughter is therefore is the legal owner of the horse.


Trader 1 has a claim against Trader 2 for non payment of her invoice, but has no claim against my Daughter.


Ownership of goods and liability for payment and VAT under a pay on sale agreement is deemed, as far as I can recall, to take place at exact time of sale. This is an agreed arrangement with Inland Revenue when Department Stores have concessions within the store.

This is my view of the issue and is why I believe my Daughter is entitled to keep the horse.

Equaliser123

I agree that your daughter has good title. In any event, there are exceptions to the principle that a party without title cannot pass title.

Amazing how so often the Police in situations where a criminal offence has been committed claim it to be a civil matter and yet, in this case, it is a civil issue which they are wrongly saying is a criminal issue.

capinpugwash

Just another thought.

If one buys goods from a retailer, who then fails to pay his suppler for those goods, is one then guilty of obtaining stolen goods, if the supplier claims the goods are stolen by virtue of not having been paid for by the retailer.

This is, in my view, the scenario we have here.

The_Hallowed_Way

capinpugwash wrote: »

If one buys goods from a retailer, who then fails to pay his suppler for those goods, is one then guilty of obtaining stolen goods, if the supplier claims the goods are stolen by virtue of not having been paid for by the retailer.

No. As long as you purchase in good faith and have no reason for believing the goods to be stolen then you are not guilty of 'receiving' (as it used to be called.)

In your original post you say that the police will be prosecuting. Whom will they be prosecuting?

I have no idea how much a horse costs these days but why are you not consulting a solicitor? I would gently suggest that this case is a little too serious to be left to a few webmongs like us to sort out, particularly as you seem already to have made up your mind on the legal position.

capinpugwash

Thanks for your suggestion regarding a solicitor.

At the moment there are a lot of words and claims being banded about by several parties, including the Police, but as yet nothing formal has been received by us.

Until then I am doing research and getting opinions, rather than spending money at this stage but as soon as the time is right I will engage a solicitor

I have had a view from my legal helpline insurance policy, and they are saying that we need to receive a formal notice to get the exact details of any claim against my Daughter.

The Police Officer was not specific about who will be prosecuted, but was treating the horse as being stolen, but then agreed to leave it in my Daughters possession untill ownership is established by the courts.

Thanks for the views so far, and I will post more when things are further advanced.

Dick_Van_Dyke

Did your daughter know about the agreement between Trader 1 and 2?
If she did then I would suggest she is guilty of a criminal offence if it is shown trader 2 stole the horse (rather) than it being a civil matter of non payment of an invoice.

If she did know then its questionable as to whether she was part of the theft (i.e deliberately purchased it from trader 2 to hide the horse as an asset) or was handling stolen goods/reset.

My personal suggestion would be to return the horse to trader 1 and sue trader 2 for the full price along with any consequential losses due to the problems.

capinpugwash

Thanks D V D

My Daughter did not know about the agreement between 1 and 2.

I am having trouble seeing how the horse can be stolen if it was willingly supplied to Trader 2 by Trader 1 but then trader 2 neither returned the horse (which had been invoiced) or paid for it.

As always there are different ways of looking at things and I am gathering opinions to both support and contest my reasoning.

I think trader 1 is trying to get the horse back from my Daughter as she sees her as an easier target, and has reported the horse as stolen to achieve this.

Trader 2 appears to be a bit of a slippery customer which is why the deal seems to have gone wrong all round.