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Citation(s) [1976] 2 All ER 552, [1976] 1 WLR 676 Ruling court Court of Appeal of England and Wales Judge sittings Eustace Roskill, Baron Roskill, Robert Goff, Baron Goff of Chieveley, John Megaw Similar National Provincial Bank v C, British India Steam Na, British Eagle Internatio, Re Brumark Investme, Barclays Bank Ltd v Quistclos | ||
Aluminium Industrie Vaassen BV v Romalpa Aluminium Ltd [1976] 1 WLR 676 is a UK insolvency law case, concerning a quasi-security interest in a company's assets and priority of creditors in a company winding up.
Contents
Facts
Aluminium Industrie Vaasen BV was a Dutch supplier of aluminium foil. Romalpa Aluminium Ltd processed it in their factory. In the contract of sale, it said that ownership of the foil would only be transferred to Romalpa when the purchase price had been paid in full and products made from the foil should be kept by the buyers as bailees (the contract referring to the Dutch expression ‘fiduciary owners’) separately from other stock on AIV’s behalf as ‘surety’ for the rest of the price. But it also said Romalpa had the power to sell the manufactured articles in the course of business. When such sales took place, this would be deemed to be as an agent for AIV. Romalpa went insolvent, and the receiver and manager of Romalpa's bank, Hume Corporation Ltd, wanted the aluminium to be caught by its floating charge. AlV contended that its contract was effective to retain title to the goods, and so it did not need to share them with other creditors in the liquidation.
High Court
Mocatta J held the retention of title clause was effective. Aluminium Industrie Vaasen was still the owner of the aluminium foil, and could trace the price due to them into the proceeds of sale of the finished goods, ahead of Romalpa’s unsecured and secured creditors. He said the following.
Court of Appeal
Roskill LJ, Goff LJ and Megaw LJ upheld the decision, and that Aluminium Industrie Vaassen retained title to the unused aluminium foil.