The nature of hire-purchase law and its impact on future commercial transactions in Uganda
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Date
2010-08
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Publisher
Kampala International University.College of Law
Abstract
This study examines the legal framework for hire purchase in Uganda, the nature and benefits of
hire purchase and compares with mortgages, credit and conditional sales, leasing, sale of goods
and outright sales. In hire purchase. the hirer is given immediate possession of goods upon
payment of the deposit, but has an option to purchase them. Subsequent payment is made in
installments, which is a credit facility to the hirer. However, the hirer gets mere possession and
not property in the goods, which only passes when he or she exercises his or her option to
purchase the goods, and only upon payment of the hire purchase price. The study revealed that
the hire purchase Act over-protects the hirer at the expense of the owner of goods. This, coupled
with government interYention defeats the rationale behind the privatization of the economy in the
1990s and consequently the freedom of contract. The determination of interest rate being the
prese1Ye of the central Bank, restricting the owner from repossessing the goods and disposing
them olT, and a host of other claw-back provisions, all attest to this. The study among others
recommends for amendment of the sections to strike a balance between the rights of both the
hirer and the owner.
Description
Research paper submitted in partial fulfilment of the requirements for the award of a degree of bachelor of Laws of Kampala International University.
Keywords
Nature, Hire-purchase, Law, Commercial transactions