Joint ownership agreement: car; three or more owners
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About this document
Whenever you would like to share ownership and use of a car with more than one other party for leisure or business use. Perhaps you race the car in your spare time, or perhaps you have a hire business for weddings, or perhaps another arrangement. Whatever your purpose, this agreement will suit.
We sell two version of this document. This document has been drawn for more than two parties. Use the other version if there are only two parties (that is, two couples, two families, two individuals or so on). Car share agreement: two owners.
First, you should consider the most suitable structure for your sharing relationship. If you are looking at an arrangement for more than ten people, then it would be better to hold the property in a limited company and buy and sell shares in it. Then ownership of the property itself never changes. No stamp duty is paid once it is bought as the right of occupation can be treated as a licence.
However, running a company does cost money, you may not want the formality, expense and greater certainty of a company structure and shareholders agreement in which case an agreement like one of these is perfect.
How the law sees it: Even if ownership of your car is registered in a company, those company documents will not record the shares in which the car is held. So If you own 60% and I own 40% we have to record that in some other document. If we do not do so, “the Law” will assume we own in the shares in which we contributed to the purchase price. These Net Lawman agreements specifically record the shares. They also record shares which may be owned by someone who is not a registered owner. This is called a beneficial interest or fractional ownership.
Application and features
- Suitable for any type of car – vintage, racing or day to day;
- Includes sensible, practical provisions;
- Written in plain English with explanatory notes.
- Terms of beneficial interest - beneficial trusts provision;
- Price and payment for the car;
- How many people allowed in the car at one time and who they may be;
- Who and how will manage payment of expenses;
- Purchase of accessories for the car – how they are purchased, whom they belong to;
- Management of the car, including operating costs;
- Management structure, ordered by annual meetings of the owners, possibility of proxy voting, and more;
- Undertakings by the parties;
- Alternative exit strategies; including allowing for a share to be sold to a third party, after offering it to all other owners;
- Timetable in the form of a schedule to allow you to arrange who will have the car when;
- Effect of termination;
- Alternative exit strategies;
- Other legal provisions to protect your interests.
This document was written by a solicitor for Net Lawman. It complies with current Indian law.
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