The essential requirements of a consumer hire agreement –


This was a dispute between two rival providers of copying machines to post offices, shops and similar small businesses for use by the public or the businesses themselves. Jonathan Ferris appeared for the Appellant. The case provides helpful guidance as to the differences between bailment and hire.

Baroness Hale explained the essence of a consumer hire agreement:

Although the English definition of a consumer hire agreement in section 15 of the 1974 Act appears to apply to all kinds of bailment…it is common ground in this case that it is confined to bailment by way of hire. The essence of hire is that the hirer acquires the use and possession of the goods from the provider in return for rent, whether payable in cash or in kind. It is to be contrasted with an agreement where the provider pays a person to keep, look after or work upon his goods. So this issue in this case became: who was paying whom for what? Were the businesses paying the provider of the copier for the privilege of having the machine on their premises so that they and their customers could use it? Or was the provider paying the businesses for the privilege of locating his machine in a place where it might generate income for them both?

[The subject agreement] fell into the latter category. Nothing had to be paid unless the copier was used.