Goods which remain unpaid or uncollected can often accumulate dust and storage costs awaiting action by a customer. It is therefore, in the best interests of a business to dispose of these goods when a customer fails to make payment or accept delivery. The Disposal of Uncollected Goods Act 1967 is a useful tool that may be utilised by a business, allowing them the right to sell the goods and recoup their costs for the care and custody of those goods.
The Act applies to businesses that accept goods for inspection, custody, storage, repair or other treatment.
As an initial step, a business should endeavour to conspicuously display in part of their premises a Notice to Customers indicating that the business will exercise a right of sale if the goods accepted by the business are ready for re-delivery and are not paid for or collected by the customer after a period of 6 months.
This is not the only obligation imposed on a business if they wish to sell goods received by a customer. There are further steps a business must take in order to ensure that they will not be in contravention of the Act and subject to penalties.
Once the goods are ready for redelivery the business must provide to the customer written notice containing information describing the goods, the amount owing for the work completed, and that if the goods remain unpaid or are not collected within six months of the notice being given, that the goods will be sold. Any notice may be given by delivering it to the person required to pay or re-claim the goods, leaving it at the persons last known place of abode or business, or posting it to the persons last known address.
If, at the expiration of the six month period, the invoice remains unpaid, or the goods uncollected the options available to a business will depend on the amount of the invoice owing.
A notice to sell must be published in a Brisbane newspaper which circulates throughout the State such as the Courier Mail, a newspaper published within the Mackay district such as The Daily Mercury, and if the item of goods is a motor vehicle, the Queensland Government Gazette.
For invoices under $110 a Notice must also be given to the customer notifying them of your intention to sell the goods. The customer will have a period of 28 days from the date of the notice to make payment of the invoice or re-claim the goods. In the event the customer does not act within 28 days, a business will have the right to sell the goods.
In order to exercise the right of sale for invoices over $110, a business is required to apply to the Court for an order authorising the sale of the goods. Prior to applying to the Court, a further notice must be given to the customer of your intention to apply for an order to sell the goods. The customer will then have a further period of 28 days to make payment of the invoice or re-claim the goods before an application may be made.
In making an order the court may authorise the applicant to sell the goods, or refuse to make such an order.
If a business is successful in obtaining an order, the Order must specify the amount the Court deems reasonable in respect of your charges,the amount in respect of costs, and allow the customer to make payment of the invoice within 28 days before the goods may be sold.
If you require information regarding your rights as a business owner please contact your preferred solicitor at our office.
