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The Importance of a Signed Contract

I recently had a meeting with one of my clients, Kieran a wholesale/installation business located in Marrickville in Sydney’s inner west. He was owed $80,000 by a company he had been dealing with who looked like they were going into administration. EC had drafted Terms of Trade previously for my client, therefore I felt comfortable that he had the correct clauses relating to debt recovery and the Personal Property Securities Register (PPSR) that would easily allow him to do a registration on the PPS Register over his work showing ownership and therefore enabling him to become a secured creditor in the event customer became insolvent.

 The only problem was my Kieran did not get the Terms of Trade signed by his client. Kieran supplied the terms of trade with his quote and was directed to do the work via email but no signed Terms of Trade were sent back to Kieran. I obtained advice from EC’s PPSR Department and was told that to do valid registrations on the PPS Register there must be a signed contract. I lost sleep over this worrying for Kieran but you can’t cry over spilt milk. The moral of this sad tale is please get your Terms of Trade drafted to include all relevant solicitor approved clauses and ensure they are regularly reviewed and updated with amendments to legislation so they remain current. Finally make sure you get them signed to complete valid registrations on the PPSR allowing you to become a secured creditor (who ranks above the ATO) in the event your client becomes insolvent.

 

Regional Contacts

New South Wales

Sydney 1300 362 070
Sydney Local Call 02 8905 4900
Corporate Collections Hotline 1300 961 916

Queensland

Brisbane 07 3145 0500

Victoria

Melbourne 03 8102 0500

South Australia

Adelaide 1300 361 070

Tasmania

Hobart 1300 438 332

Western Australia

Perth 08 6214 0500

ACT

Canberra 1300 438 332

Regional Manager – Inner West Sydney

 

Monika Chauhan EC Credit Control

Monika Chauhan
Area Manager
Inner West / Sutherland Shire
0417 664 160