ICANBusiness LawSale of Goods and Hire Purchase2022

Which of the following is the primary legal characteristic that distinguishes a Hire Purchase Agreement from an Outright Credit Sale under Nigerian commercial law?

AIn a Hire Purchase agreement, property (ownership) in the goods passes immediately to the hirer upon signing the agreement
BA Hire Purchase agreement is a contract of bailment coupled with an option to purchase, where property passes only when the option is exercisedCORRECT
CCredit sales are regulated exclusively by the Hire Purchase Act Cap H4 LFN 2004, whereas hire purchase contracts are governed strictly by common law
DIn a Hire Purchase agreement, the hirer is under a legal obligation to purchase the goods and cannot terminate the agreement before final payment
AI
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Why the answer is B, and why the others tempt you.
A Hire Purchase agreement is legally defined as a contract of bailment where the owner lets goods out on hire to the hirer with an option (not an obligation) to purchase. Ownership remains with the owner until all conditions are fulfilled and the final option is exercised.
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