Short answer: If your terms of sale contain a retention of title clause that formed part of the contract, you keep ownership of the goods until you are paid (Sale of Goods Act 1979, section 19). That can let you recover goods that are still identifiable and unused. It rarely helps once goods have been mixed, used or sold on, and if the customer goes into administration you need the administrator's consent or the court's permission before you take anything back.
Suppliers of materials, stock, equipment and components often deliver on credit. When the customer stops paying, the obvious question is whether you can simply get your goods back. A well-drafted retention of title clause (sometimes called a Romalpa clause) can give you that option, but it only works in the right conditions, and it is weakest exactly when you need it most: when the customer is in financial trouble.
This guide is general information for UK businesses, not legal advice. It covers England and Wales. Statutory references were checked on legislation.gov.uk on 26 October 2026. Primary reading: the Sale of Goods Act 1979, sections 17, 19 and 25, and Schedule B1 to the Insolvency Act 1986, paragraphs 43 and 111. Take advice from a solicitor before trying to reclaim goods.
How retention of title works
Under the Sale of Goods Act 1979, ownership of goods passes when the parties intend it to (section 17). Section 19 lets a seller reserve the right of disposal until conditions are fulfilled, and where it does, ownership does not pass to the buyer even though the goods have been delivered. A retention of title clause uses this to say that the goods remain yours until you have been paid.
| Type of clause | What it claims | How reliable |
|---|---|---|
| Simple clause | Ownership of the specific goods until those goods are paid for | Generally effective if the goods are identifiable and unaltered |
| All monies clause | Ownership of all goods supplied until every sum owed is paid | Can be effective, gives wider cover on a running account |
| Mixed goods clause | An interest in products made using your goods | Often fails or is treated as a charge |
| Proceeds clause | The money the customer receives from selling your goods on | Frequently treated as an unregistered charge and void against a liquidator or administrator |
When it will not protect you
- The clause was not part of the contract. Terms first seen on the invoice or a delivery note, after the order was agreed, may not bind the customer. Get terms accepted at account opening and reference them on quotes and order acknowledgments.
- You cannot identify the goods. Without serial numbers, batch codes or clear delivery records, it is hard to prove which items on the customer's premises are yours and unpaid.
- The goods have been used, mixed or incorporated. Paint on a wall, ingredients in a product or materials built into a structure usually cannot be reclaimed. For construction supply chains, see construction unpaid invoices.
- The goods have been sold on. Under section 25 of the Sale of Goods Act 1979, a buyer in possession who sells to someone acting in good faith can pass good title, so you cannot take the goods from the new owner.
If the customer goes into administration or liquidation
Paragraph 111 of Schedule B1 to the Insolvency Act 1986 includes a retention of title agreement in its definition of a hire-purchase agreement, and paragraph 43(3) says no step may be taken to repossess such goods in the company's possession except with the administrator's consent or the court's permission. In practice that means:
- Write to the administrator or liquidator straight away asserting your claim, with a copy of the terms, the signed account application or order, the invoices and a list of identifiable goods.
- Ask for the goods to be ring-fenced or for a stock count to be done with you present. Insolvency practitioners deal with retention of title claims routinely.
- Do not remove goods yourself. Doing so without consent or permission can expose you to legal action.
- Submit a proof of debt for the balance you cannot recover through the goods. Unsecured creditors often receive little, so check the warning signs early; see insolvency warning signs before instructing debt collection.
If the customer is still trading
Retention of title is often more useful as leverage than as a repossession route. A clear letter that identifies your unpaid goods and reminds the customer that they still belong to you can prompt payment. Run it alongside your normal escalation:
- Check the company's status on the Companies House register.
- Send a final demand that refers to your retention of title clause and lists the goods concerned.
- Follow with a letter before action, adding statutory interest and fixed compensation where your terms do not set a different rate.
- Stop further supply on credit until the account is up to date.
- If a director has signed a personal guarantee, note it as a separate route.
Set up your terms before the next order
The best time to rely on retention of title is before anything goes wrong. Put the clause in your standard terms, get them accepted on every new account, keep signed copies, mark or record goods so they can be identified, and keep delivery notes. The same documents make any later claim stronger; see the proof of debt checklist.
Frequently asked questions
What is a retention of title clause? It is a term in your conditions of sale saying that ownership of the goods stays with you until the customer has paid for them. Section 19 of the Sale of Goods Act 1979 allows a seller to reserve the right of disposal until conditions, such as payment, are met, so ownership does not pass on delivery.
Does a retention of title clause work if it is only printed on my invoice? Often not. The clause has to be part of the contract, which is usually formed before the invoice is sent. Make sure your terms are accepted before or at the time of the order, for example signed on an account application, referenced on your quote and order acknowledgment, and kept on file.
Can I just go and collect my goods if the customer does not pay? Only if your terms give you that right, and even then you should not enter premises or remove goods without the customer's agreement. Write first, identify the goods precisely, and ask for access or return. If the customer refuses, take legal advice rather than using self-help.
What happens to retention of title if the customer goes into administration? Paragraph 43(3) of Schedule B1 to the Insolvency Act 1986 stops anyone repossessing goods held under a retention of title agreement without the administrator's consent or the court's permission. Send your claim to the administrator quickly with the contract terms, invoices and a list of identifiable goods.
Does retention of title still work if the goods have been used or sold on? Usually not for those goods. Once goods are mixed or built into something else, they often cannot be identified and reclaimed. If the customer has sold them on, the buyer will normally get good title under section 25 of the Sale of Goods Act 1979. Clauses that claim the sale proceeds are frequently treated as unregistered charges and fail.
What is an all monies clause? It keeps ownership of all goods you have supplied until the customer has paid everything it owes you, not just the invoice for those goods. It can give wider protection on a running account, but it must be clearly drafted and part of the contract.
Can I use retention of title and debt collection at the same time? Yes. Reclaiming identifiable goods and pursuing the unpaid balance are not mutually exclusive, although anything you recover through the goods reduces what is owed. If the customer is insolvent, the administrator or liquidator controls both routes, so get advice first.
Will your partner help recover an unpaid invoice for goods? We are an introducer, not solicitors or an FCA-authorised firm. Where an undisputed debt owed by a Ltd, LLP or PLC is accepted by our partner, the fee is 15% of what is recovered, payable only when you have been paid. Recovery is not guaranteed, and retention of title claims in an insolvency may need a solicitor.
If a Ltd, LLP or PLC still owes you for goods and the debt is not disputed, upload the invoice via business debt collection or read how no collection, no fee works. The fee is 15% of what is recovered, payable only when you have been paid. Recovery is not guaranteed.