Sale and Purchase Contract Solicitors
A sale and purchase contract is a legally binding agreement under which a seller agrees to transfer ownership of goods to a buyer in exchange for a price, setting out the description of the goods, price, delivery, when ownership and risk pass, warranties and remedies.
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Adam Bernard Solicitors drafts sale and purchase contracts, terms and conditions of sale and terms of purchase for UK businesses.
Sale of goods contracts underpin almost every trading business. Whether you are a seller wanting to secure payment or a buyer wanting reliable quality, the contract decides who carries the risk.
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Sale and Purchase Contracts We Prepare
Standard terms and conditions of sale for sellers supplying business customers.
Standard terms and conditions of purchase for buyers dealing with suppliers.
Bespoke sale and purchase agreements for high-value or one-off transactions.
Asset purchase agreements for buying specific business assets such as equipment and stock.
Framework supply agreements for repeat orders.
For ongoing trade supply to retailers, see our wholesale supply agreement page; for appointing a reseller, see distribution agreements.
What a Sale and Purchase Contract Typically Includes
A sale and purchase contract should describe the goods, the price and payment terms, delivery, the passing of title and risk, quality warranties, liability limits and remedies.
Description of the goods – specification, quantity and any sample.
Price and payment – including VAT, deposits, payment dates and interest on late payment.
Delivery – place, date, method and consequences of late or short delivery.
Title and risk – when ownership and the risk of loss pass to the buyer.
Inspection and acceptance – how and when the buyer can reject goods.
Warranties – quality, fitness for purpose and compliance with law.
Liability – caps and exclusions.
Force majeure and termination.
The Sale of Goods Act 1979: Default Rules
If a business-to-business contract does not deal with an issue, the Sale of Goods Act 1979 fills the gap. Key provisions of the Sale of Goods Act 1979 include:
- Impliedterms that the seller has the right to sell (section 12) and that goods match their description (section 13).
- Implied terms of satisfactory quality and fitness for purpose (section 14) and correspondence withsample (section 15).
- Ruleson when property passes (sections 16 to 19) and when risk passes (section 20).
Excluding or Limiting Liability
In business-to-business sale contracts, the implied term about title cannot be excluded, and exclusions of quality and description terms must be reasonable. These rules come from the Unfair Contract Terms Act 1977. Courts look at factors such as bargaining power, whether the buyer was offered an alternative and whether the term was standard in the trade.
Battle of the Forms
When a buyer and seller each send their own standard terms, the terms that apply are often those sent last before performance, known as the battle of the forms. Clear ordering procedures and order acknowledgements help ensure your terms prevail.
Selling to Consumers
If you sell goods to consumers, the Consumer Rights Act 2015 applies instead of the Sale of Goods Act, and consumers’ statutory rights cannot be excluded. The Consumer Rights Act 2015 gives consumers rights to reject, repair, replacement and refunds. For online sales, see our e-commerce terms and conditions page.
Securing Payment
Sellers can protect themselves with deposits, retention of title clauses, credit limits and statutory late payment interest. The Late Payment of Commercial Debts (Interest) Act 1998 gives a statutory right to interest on overdue business invoices.
Sale and Purchase Contract Checklist
Before relying on standard terms of sale or purchase, check that they:
- Identifythe correct legal entity as seller or
- Are incorporated into every order, for example through quotations, order forms and
- Setout clear delivery, inspection and rejection
- Containa retention of title clause, for
- Includerealistic liability caps and exclusions that are likely to be found
- Providefor late payment interest or a substantial alternative
- Dealwith force majeure and price
How Adam Bernard Solicitors Can Help
We draft sale and purchase contracts, terms of sale and purchase, and asset purchase agreements, and review contracts offered to you through our contract review service. See all our commercial contract services.
Call 0207 100 2525 (24/7) or book a free consultation to discuss your contract.
This page is for information only and does not constitute legal advice.
Frequently Asked Questions
What is a sale and purchase contract?
When does ownership of goods pass to the buyer?
Can a business exclude the implied terms in the Sale of Goods Act?
What is the battle of the forms?
Does the Sale of Goods Act apply to consumer sales?
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