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Car ownership and responsiblity

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asked on Jul 2, 2017 at 05:41
by   Eric870121
Hi greetings all lawyers here,
Have a question here, my friends have some difficulties to get a car.  So, the plan is i will buy the car with my name and loan (Basically, the ownership legally is mine) with comprehensive insurance under my ownership with he is named as the "second driver".  Of course, our agreement is, he will bear everything until he settle the car loan / change of ownership.  In other words, he will pay for the loan amount + any amount spent (e.g. maintenance, road tax, insurance etc)
I have few questions here,
1) If he fail to pay (especially the installment) to me, can i legally want it from him ? IF not how ?
2) If the car had been used for illegal activity, any idea what is the consequences ?
So far, my only option is to prepare a simple agreement (not sure require stamp in IRB like tenancy agreement) with few clause stated that he 
1) will pay for the rental and any expenses occur on the stated vehicle
2) will held fully responsible if there is any unlawful activity, accident etc.

The exact clause are as below
1. 
 I agree to pay a sum of RM400 (Four Hundred Ringgit Malaysia) as monthly rental fee to the owner stated above.
2.     Not to use the stated vehicle for any unlawful activity and will be held fully responsible for any, but not limited to vehicular accident, damages, lose, fire or theft caused to the stated vehicle.
3.     In the event that the Termination Date occurs, for any reason, prior to the end of the tenure period, the Borrowers shall pay the sum of the remaining period of 108 months including any Administrative Agent, for the benefit of the Lenders.
Kindly advise if i am doing the right thing, thanks alot guys.
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7 Answers

answered on Jul 2, 2017 at 06:41
by   SimpleMind
Drugs found inside the car, you are fully responsible. No amount or quantities of agreements can save you from the death penalty. The lawyers fees to defend yourself for years is good enuf.
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answered on Jul 2, 2017 at 16:49
by   Eric870121
Hey thanks SimpleMind, even with agreement like those in car rental company will not defend you on this ? Let's say i really need to go for this option, any other alternatives ?
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answered on Jul 2, 2017 at 21:48
by   vkpc
Let's say i really need to go for this option, any other alternatives?
Since you say you need to do it, then do it lah.
As long as you trust the person, there is no need for an agreement.

Please note that the simple agreement you mentioned above cannot be used in Court as you do not have a car rental license.
However the simple agreement is still useful to remind both sides what was agreed upon earlier.
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answered on Jul 2, 2017 at 23:06
by   SimpleMind
a) If all things goes well, you stand to gain something. You get NCB in the future and Goodwill.

b) If things go bad, you may ended up with debts, bill collectors chasing you, lawsuits from death accidents and possible Bankruptcy  proceedings. If financially he is having problems with banks, can he keep up with the payments and can pay for any lawyers fees?

The risk is all yours since that person is a good companion.

UR are buying a goodwill service. CAVEAT EMPTOR
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answered on Jul 3, 2017 at 03:40
by   Eric870121
Thanks to both of you.. 
Quick question VKPC, 
However the simple agreement is still useful to remind both sides what was agreed upon earlier. 
What is this mean ? Mean just serve as reminder and nothing else?
simplemind, financial wise i am not so afraid as the most risk i take was only having lost of 30k (Worse case financially if the loan cannot be settled), but i mentioned earlier, my concern is more on illegal activity with the car.  
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answered on Jul 3, 2017 at 03:51
by   vkpc
What is this mean ? Mean just serve as reminder and nothing else?
Yes.

Under Contract Law, if the object of a contract is illegal, ( car rent without license )
the contract cannot be binding in law.
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answered on Jul 3, 2017 at 16:39
by   jeff005
edited Jul 3, 2017 at 16:43
by   jeff005
You can try the following..

Make 3 agreements (subject to other laws in place - if any)

1. Make a INTEREST FREE PERSONAL LOAN. repayment via monthly installment to your bank acc. Use this acc to pay for the car loan via standing instructions.

2. Make an agreement for the usage of this car and he will sign an INDEMNITY to indemnify you of any losses pertaining to this car.

3. Make an agreement that you would transfer ownership to him after he has settle any financial penalties like accident claims (insurance do not pay FULL), parking summons, etc,etc..

Get the 3 agreements ATTESTED  by a Commissioner of Oaths.

Wow.. you have gained good karma.. you give interest free loan and also allow him/her to drive your brand new car with no time limit. Your gf/bf??
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