Equipment leasing and hiring
Produced in partnership with Paul de Vince of Gateley

The following Commercial practice note produced in partnership with Paul de Vince of Gateley provides comprehensive and up to date legal information covering:

  • Equipment leasing and hiring
  • Introduction
  • Nature of a contract of hire
  • Who owns the underlying asset?
  • Sale and leaseback transactions
  • Finance leases v operating leases
  • Finance leases
  • Operating leases
  • Implied terms in an equipment lease or hire agreement
  • Fixtures
  • More...

Equipment leasing and hiring

This Practice Note provides an overview of the contractual considerations which arise when leasing or hiring equipment, being a contract for the simple hire or bailment of goods, in a business to business transaction. This Practice Note does not consider hire-purchase or consumer hire.

Introduction

Equipment leasing, or equipment hiring, is an expression applied to various agreements which involve a contract of simple hire or bailment of goods.

There are many reasons why parties may consider leasing or hiring assets or equipment, since it provides an alternative form of financing whereby payments are made in instalments over an agreed period of time.

Typically, an equipment lease or hire transaction involves a lessor (also referred to as a supplier or owner) who owns the underlying asset and a lessee (also referred to as a hirer) who, in return for consideration (namely rentals or a hire fee), obtains use of the asset pursuant to the agreed contractual terms. In lease or hire arrangements involving multiple, separate transactions, a master lease agreement is often utilised with the terms for each tranche of equipment evidenced by a separate lease schedule. In larger transactions, especially those involving complicated structures, the parties are more likely to use lease documents that include additional provisions applicable to the specific types of assets or structures.

For further information on the commercial considerations involved in a

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