BALANCING OWNER’S RIGHT AND HIRER’S PROTECTION: A STUDY OF SECTION 14 OF THE HIRE PURCHASE ACT AND ITS IMPLICATIONS ON HIRE PURCHASE AGREEMENT

Abstract

The article examines the provisions of section 14(1-3) of the Hire Purchase Act Cap H4 LFN 2004 in Nigeria, highlighting its legal interpretation, and its impact on the right and obligation of parties in Hire-Purchase transactions. Through a critical examination of relevant case law and statutory provisions, this article provides insights into Section 14, stating the requirements for the owner to succeed in a claim for adverse possession which are that: the hirer must be in default of the terms of the agreement, the continual retention and possession of the goods must be against the owner’s interest, the right to recover possession of the goods must have accrued, there must be a request for the hirer to surrender the goods and the request must be in writing. However section 9 of the HPA limits the application of section 14 of the Hire Purchase Act as where the hirer has paid a relevant proportion of the hire purchase price, the owner can only recover possession of the goods through an action in court. This could limit the owner’s ability to recover possession of the goods especially if the hirer can demonstrate that he has been in possession of the goods. Implication of Section 14 is to the effect that if the hirer refuses to deliver up possession of the goods it is sufficient enough to ground the statutory cause of action in damages for adverse possession. This study underscores the limit of owner’s property rights leading to a breach of section 44 of the Constitution1, it may give the hirer an unintended advantage in disputes over ownership and possession of the hired goods. The study recommends that the right of owner to recover his goods and the right of hirer to protect his interest must be balanced. Specified time frames and mode for written requests should be provided for in the Hire Purchase Act and section 14 of the Hire Purchase Act should be reviewed to ensure it remains effective and fair addressing any unintended consequences that may arise.