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Legal matters

Rights of Recovery

2 replies

gigi556 · 24/02/2020 16:41

I'm starting a product business. I designed something and someone else is going to make it. My insurance broker has advised that it's unlikely I'll get product liability insurance without a rights of recovery or recourse agreement in place because I have no control over the manufacturing process etc. Is this something that gets written into a contract? Do I need to speak to a solicitor? Is it written into the suppliers insurance agreement? Any advice or ideas on where to get advice appreciated. As it stands, my current supplier (just a seamstress working from home who has been helping me with the design) doesn't have insurance so I need her to get some in place or find someone else to make the product to sell.

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LonginesPrime · 24/02/2020 16:59

Who will be selling the finished product?

If it's you, then you'll need a contract with your supplier anyway, otherwise there's no way of ensuring you can deliver to your customers.

You'd want to cover things such as what happens if products are delivered late or aren't of sufficient quality, how much you're paying, how you're going to communicate orders, who's responsible for sourcing and checking the raw materials, etc, so both parties know where they stand.

Typically, you'd get a solicitor to draft this kind of thing, but I wonder if there is a template you could get from a local business advice centre? I'd imagine it's quite a common agreement for small businesses. I'd have a look online but don't pay for anything unless you're sure as to what you're getting.

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gigi556 · 25/02/2020 15:15

@LonginesPrime THanks. I think I have template so good point!

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