Commentary

53.2 Deposit and part payment distinguished

BOILERPLATE AND COMMERCIAL CLAUSES vol 4(3)
| Commentary

53.2 Deposit and part payment distinguished

| Commentary

53.2 Deposit and part payment distinguished

A deposit serves the dual purpose of:

  1. (a)

        going against the purchase money or service fee if the transaction is completed; and

  2. (b)

        acting as a guarantee that the buyer means business1.

Deposits can be distinguished from part-payments as a deposit, in the absence of agreement to the contrary, cannot be recovered2.

If the advance payment is a ‘part payment’ rather than a deposit, the customer may be able to recover some or all of it, even if the contract was terminated because of his default. The tradesman would, however,

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