Title and Risk of Loss

Title and Risk of Loss

In connection with the delivery of goods, the parties to such a transaction may clarify when title to the goods and/or when the risk of loss or damage to the goods during transit passes from the deliverer to the deliveree. The determination as to which of the parties holds title and/or bears risk of loss at any particular time during the delivery process (and therefore which party should seek protection through insurance) will depend on when and where such title or risk transfers between the parties per their contract:

Exemplar C76-1

For shipment within the United States, title to any deliverables, exclusive of Supplier’s rights to its intellectual property, and risk of loss will pass to You upon delivery to Your carrier. For shipments from the U.S. to outside the U.S., title to and risk of loss will remain with Supplier until the shipment arrives at the importing country's entry port (or at a bonded warehouse within Canada or Mexico if Customer so requests shipment). For shipments within EMEA (i.e. originating in Ireland), title to and risk of loss passes to You at the Irish shipment point. If You insure shipment, the insurance will protect Supplier’s interest until title passes as set forth above. Notwithstanding the above provisions no title to Supplier Software is transferred to Customer.

Exemplar C76-2

Bailee shall be responsible for the Products from the time they are delivered to Bailee until they are delivered to a common carrier for return to Supplier. Bailee shall reimburse Supplier for any damage to the Products sustained during this time period, except for reasonable wear and tear, sustained as a result of Bailee’s negligence. Upon the termination of this Agreement for any reason, Bailee shall immediately terminate use of the Products, and within five (5) days return the Products to Supplier at Supplier’s expense. Supplier shall reassume the risk of loss upon delivery of Products by Bailee to a common carrier for return to Supplier.

The following exemplar is an example of a so-called “Romalpa Clause,” which is a type of title-retention clause that separates the passing of title and risk of loss by providing that until payment is received by the seller, title remains with the seller:

Exemplar C76-3

Risk of loss and damage shall pass to the Buyer upon delivery. Title shall pass to the buyer upon payment in full.