PLANT AND MACHINERY IN ACQUISITION
Schedule
A schedule of the items
of plant and machinery which are part of the sale is usually attached to the
acquisition agreement. A buyer who wishes to purchase all of the assets needed
to run the business may seek to safeguard itself by providing that plant and
machinery ‘used in the business’ are to
be transferred, including but not
limited to those items listed in the schedule. Thus items forgotten or omitted
from the schedule by will stillbe included in the sale.
Insure the plant and
machinery
The buyer will normally
assume risk on the plant and machinery when the acquisition agreement is executed
and should get insurance cover from this date, even if completion is delayed.
Warranties
As a buyer you should ask
to include the following warranties as to the condition of the items of plant
and machinery:
(a)
they
are in a proper state of repair and condition and in satisfactory working
order;
(b)
they
have been properly and regularly maintained
(c)
they
are adequate for (and not surplus to) the need of the business.
(d)
they
are not dangerous, obsolete or in need of replacement;
The seller should be
careful before agreeing to these warranties and try to restrict any liability
to major defects.
