CIPS L5M5 Exam - Topic 2 Question 13 Discussion

Actual exam question for CIPS's L5M5 exam

Question #: 13
Topic #: 2

Juicy Boots has a contract with Orange Ltd containing a Retention of Title Clause. Juicy Boots failed to pay for two deliveries, and Orange Ltd reclaims goods already delivered. Is this valid?

AYes -- the product still belongs to Orange Ltd

BYes -- the product can be reclaimed under any circumstances

CNo -- if Juicy Boots signed for delivery, goods belong to them

DNo -- delivery on time transfers ownership

Show Suggested Answer

Suggested Answer: A

Comprehensive and Detailed Explanation From Exact Extract of Documents:

A Retention of Title Clause states that ownership of goods remains with the seller until full payment is made. According to the L5M5 study guide (p.190), Orange Ltd legally retains ownership of the fruit delivered until Juicy Boots settles payment. This clause protects suppliers, particularly SMEs, from non-payment risks. Signing for delivery does not override the clause, and timely delivery is irrelevant. Retention of Title is an important risk management tool in procurement contracts.

Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.190

by Asha at Apr 11, 2026, 01:43 PM

Limited Time Offer

25%

2 months ago

I remember studying Retention of Title Clauses, and I think they allow the seller to reclaim goods until paid for. So, I lean towards A.

upvoted 0 times

...