Pledge in the transport agreement and storage agreement

A pledge is a security right established on movable property, whereby the pledgee is entitled to recover his claim from these goods. This also applies if the debtor (pledgor) goes bankrupt.

A logistics service provider who does not want to join the ranks of often hopeless concurrent creditors would be wise to establish a pledge on the goods that are transported or are in his warehouse.

Pledge

In this contribution I will focus exclusively on the pledge, whereby the goods of the client are in the power of the pledgee, which in practice will often be the case when carrying out a transport or when having goods in storage in the context of the execution of a storage agreement.

Is establishing a pledge complicated? No, definitely not.

The three requirements for transfer apply to the establishment of a pledge on movable property, namely (1) a title, (2) delivery (3) power of disposal.

(1) A valid title means that a pledge must be agreed. This can be explicitly included in the transport agreement or in the storage agreement in the event of storage of goods.

The General Transport Conditions (AVC), the Fenex conditions or the storage conditions of Stichting Vervoersadres (Sva) also contain articles in which a pledge is established in favour of the carrier or the custodian, respectively. By only applying these conditions, the right of pledge is agreed.

Should a client unexpectedly go bankrupt, it is advisable to check whether the transport or storage conditions contain such a right of pledge article. Claims are often not enforced by the creditor, who turns out to be the pledgee.

(2) In logistics practice, delivery often takes place because the carrier and the warehouse company have taken possession of the goods in order to transport these goods or to store them.

(3) The pledgor’s power of disposal is the third condition that must be met for the establishment of a legally valid pledge. Only the owner of the goods is authorised to act as pledgor and to establish a right of pledge on his goods in favour of the pledgee. If the pledgor turns out not to be the owner, the pledgee (read: the logistics service provider) is protected in the event that he acted in good faith and could assume that the pledgor was the owner.

Bankruptcy and pledge

The pledgee is a separatist, which means that his position and his (pledge) right are not affected by the bankruptcy of his client. The pledgee can recover his claim from the proceeds of the sale of the pledged goods without the consent of the debtor and trustee.

Pledge after sale and transfer of ownership of the pledged goods

A pledge is a so-called property right, which has a material effect. This means that the pledge remains on the movable property, regardless of in whose hands the (movable) property is located. If the pledge was established by the (former) owner and then sold to a third party, the pledgee (read: logistics service provider) remains entitled to recover his claim on these goods.

Retention of title and pledge

In practice, (delivery) conditions contain a retention of title nine times out of ten, which means that ownership of a movable property is only transferred after payment of the full purchase price. If a third party rightly makes a retention of title, the pledgor did not become the owner and was not authorised to establish a pledge on a movable property of which he was not the owner. In such cases, the pledgee (logistics service provider) can rely on good faith, because he was not aware of the retention of title.

Please contact Transportrechtadvocaat if you would like to be informed about your position as a creditor and the means available to you to get your outstanding invoices paid.

Mr. Otto Lenselink

March 2017

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