allocation of risk

Question 1

whites a retention of title clause?

Answer 1

• a retention title clause ensures that the title to the goods remain vested in the seller until the buyer fulfils certain obligations, which is typically the payment of the price
• if the buyer is declared bankrupt before paying the goods, the seller can subsequently retrieve the goods from the liquidator due to making the transfer of ownership subject to specific conditions

Question 2

what is a force majeure clause?

Answer 2

• a clause that predetermines the allocation of risk and free each party from liability if specified circumstances arise that are beyond the control of the parties and prevent either party from fulfilling their obligations
• e.g. strikes, riots, wars, acts of god