Equipment Hire Agreement

Explanatory Notes

Equipment Hire Agreement

This Equipment Hire Agreement is intended for use where one party (the "Owner") hires out equipment to another party (the "Hirer").

The Equipment Hire Agreement is reasonably straightforward and contains details of the Equipment, the Hire Charge and the Hire Period in a Schedule, which should be completed and attached to the Equipment Hire Agreement when it is signed.

Specific comments on the model form are set our below:

DATE

This is the date when the agreement is signed by both parties. This is not necessarily the date upon which the Hire Period starts.

PARTIES

Here set out the full name of each party and the official address of those parties - the registered office in the case of a limited company incorporated in England. The address at which the Equipment will be located should also be recorded - in Part D of the Schedule.

1. DEFINITIONS

We have inserted definitions of the Equipment, the Hire Period and Hire Charges. When filling in the Schedule, care should be taken to include all relevant details. For example, in the case of the Equipment, it is recommended that you include the manufacturer's definition and any serial numbers, as well as referring to cables and other ancillary items.

2. HIRE AGREEMENT

This clause sets out the basic agreement between the parties - namely that the Hirer will rent the Equipment for the specified Hire Period.

Sub-clause 2 contains provision for the Hire Period to be extended by agreement. It is certainly recommended that any extension is agreed in writing before the initial period (or any extended period) expires.

3. DELIVERY OF EQUIPMENT

There are two alternatives here - either the Owner will deliver the Equipment to the Hirer or the Hirer will come to collect the Equipment from the Owner. Transportation costs, if any, incurred by the Owner are dealt with in Part B of the Schedule.

4. HIRER'S GENERAL OBLIGATIONS

This contains a number of sub-clauses, not all of which will be relevant in every case. The general approach of the agreement and, in particular, of this clause, is that the Hirer is fully responsible for the Equipment whilst it is in his possession and that responsibility extends to such matters as obtaining any necessary consents, whether from the planning authorities, landlords, etc. 

The Hirer must also maintain the Equipment in good condition but fair wear and tear is an appropriate exclusion. In this connection, an agreed schedule of condition noting any previous damage can usefully be signed at the time of hire - although we have not catered for this specifically in our Equipment Hire Agreement.

5. OWNER'S GENERAL OBLIGATIONS

The obligations of the Owner are relatively limited. It is not unusual for the Owner of hired equipment to maintain insurance and our clause deals with this. The Hirer should be given access to the policy so that the Hirer knows what, if any, additional insurances they should maintain in order to have cover against any claims by the Owner should the Equipment be lost or damaged.

If the Equipment malfunctions through no fault of the Hirer, the Owner has an obligation to repair or replace it - but we have worded this in such a way that the replacement obligation is conditional on the Owner having some spare Equipment to offer to the Hirer.  if they do not, a rebate of the Hire Charge while the Equipment is unusable would be appropriate.

6. HIRE CHARGES AND PAYMENT

This sets out the basic payment terms - it is usual for Equipment Hire Charges to be payable in advance - either for the entire period or for an initial period of one month, three months, etc.

If either the Owner or the Hirer is responsible for any extras (e.g. transportation costs), this needs to be covered by the payment terms in the Schedule.

7. INDEMNITY

This is designed to protect the Owner against any third party claim. In fact, it is not always legally possible for an Owner to be exempt from liability if, for example, they supply defective Equipment, which causes death or injury to an individual. 

8. TERMINATION

The Owner is given the right to terminate and recover Equipment if the Hirer becomes insolvent or commits any breach of the Equipment Hire Agreement.

9. ASSIGNMENT

An agreement to hire equipment is essentially an agreement between two parties and it will not be appropriate for the Hirer to pass the Equipment on to someone else - hence the restriction on assignment or subletting.

1O. DISPUTES AND GOVERNING LAW

We have kept the wording of this clause simple, so that it states the governing law and refers to the courts of that country.

SIGNING

Each party signs the Equipment Hire Agreement. In the case of a company, a duly authorised individual, usually a director, should sign. 

SCHEDULE

As previously mentioned, the details in the Schedule need to be filled in with care so that the precise terms of the hiring are clear and unambiguous.