Securitisation Guide 2018: Cayman Islands

1 Receivables Contracts

1.1 Formalities. In order to create an enforceable debt obligation of the obligor to the seller: (a) is it necessary that the sales of goods or services are evidenced by a formal receivables contract; (b) are invoices alone sufficient; and (c) can a binding contract arise as a result of the behaviour of the parties?

A formal written contract is not necessary to create an enforceable debt obligation. However, such an obligation must be created as a matter of contract or deed. Contracts may be written, oral, or partly written and partly oral. An invoice alone may be sufficient to constitute a contract between the parties if it contains the required elements of a contract. The existence and terms of an oral contract may be evidenced by the conduct of the parties. Where enforceable obligations can be identified with sufficient certainty, a contract may be implied based on a course of conduct or dealings between the parties.