Buying or selling a boat in the UK: common pitfalls and how to avoid them

A common, and sometimes deal breaking pitfall, is where the seller cannot produce evidence of complete ownership of the boat.

Buyers will expect to seek an unbroken chain of Bills of Sale from the initial builder to the current seller, demonstrating how ownership has passed from one owner to the next. A lost Bill of Sale would break this chain as would ownership changes that were never properly recorded.

Resolving title issues can be a time-consuming process, often requiring former owners to be traced or replacement documentation to be obtained. To minimise delays, sellers should ensure they can provide a complete and clearly documented chain of ownership from the outset.

The VAT position is heavily reviewed by a buyer on a boat transaction. Issues often arise when the seller cannot provide VAT documentation or the boat’s importation history is unclear.

This risk is increased where a vessel has changed ownership multiple times or has spent time outside the UK.

A buyer will be unlikely to proceed if these questions cannot be answered. Addressing VAT issues at an early stage can prevent delays.

Disputes are likely to arise where the parties have a different understanding of what has been agreed. Questions can emerge in relation to:

• deposit arrangements

• responsibility for repairs

• equipment included in the sale

• termination of the agreement

While these issues are typically discussed when a deal is agreed and may often seem minor, failing to document them properly can lead to disputes over what was actually agreed between the parties.

A clearly drafted document provides certainty for both parties and reduces the chance of misunderstanding.

A survey can often be the key catalyst for a boat purchase falling over. If defects are identified, the parties might disagree over who should incur the costs of the repairs.

A buyer might seek a reduction in the price or for the seller to pay the repairs. A seller could argue that the agreed price reflected the condition of the boat. This dispute can break the relationship between the parties.

Ensuring that parties have agreed from the outset how survey issues will be addressed can avoid unnecessary conflicts and keep the transaction progressing.

Registration should be a straightforward matter. However, issues with registration records can cause delays. The ownership details might not have been updated, the previous owners might remain on the register or there might be missing registration certificates.

These issues raise questions for the buyer which can delay the transaction as enquiries should be made before the transaction progresses.

Buyers might seek additional reassurance before committing to the purchase. Sellers should review registration records at an early stage to ensure they reflect the boat’s current status.