Creating a sales contract
- What is a contract of sale
- Creation of a sales contract: parties
- Form of the sale agreement
- Contents of the sales agreement
- Creating a purchase and sale agreement: what else needs to be negotiated
- How to issue a purchase and sale agreement
- How to terminate the contract
- How long is the contract valid
- Creation of a contract of sale: Valen services
What is a contract of sale
The contract of sale is a document that certifies in writing the transfer of ownership from the seller to the buyer. This type of transaction implies that the seller assumes the obligation to transfer the goods to the buyer together with all accessories and documents within the prescribed period. And the buyer promises to accept this product and pay a certain amount for it.
The contract of sale is considered concluded as soon as the parties have agreed on the goods. But the ownership of the thing passes from the seller to the buyer only at the time of its transfer. The exception is the purchase and sale of real estate. You can buy with prepayment, in installments or on credit. In these cases, ownership is retained by the seller until full payment.
Creation of a sales contract: parties
The Civil Code imposes a minimum of requirements on the parties to the contract of sale. The main requirement: the seller must be the owner of the goods or have other rights that allow him to transfer the goods to the buyer.
The contract of sale can be concluded by citizens among themselves, and a citizen with a company, and two legal entities. The only difference is the amount of responsibility and whether the law “On Consumer Protection” will work. We will tell you about the general rules for concluding a contract of sale and about the norms that protect citizens.
Form of the sale agreement
Whether or not a paper document is needed depends on what is being sold and bought by whom. Compliance with the written form is necessary in such cases:
- The subject of the transaction is real estate.
- One or both parties are legal entities.
- A citizen sells goods worth more than 10 thousand rubles to a citizen.
The exception is transactions that are executed at the time of their conclusion. For example, retail.
Contents of the sales agreement
The document must specify the subject of the sale agreement. It should be clearly stated what exactly the seller transfers to the buyer’s property. If, for example, it is a real estate object, be sure to indicate the full address and cadastral number. Separately, it is prescribed that the seller is the owner of the goods, and other persons do not claim it, the goods are not pledged, are not burdened and are not arrested. This standard phrase will save the buyer from possible troubles if third parties decide to challenge the transaction.
Also, when creating a contract of sale, the consumer characteristics of the subject of the transaction, its completeness and quantity are listed. Experienced lawyers also recommend describing the product in as much detail as possible. An image of the product or sample can be attached to the contract of sale: a photo or a graph. This will come in handy if you have to prove in court that the goods actually received do not correspond to the subject of the agreement.
Creating a purchase and sale agreement: what else needs to be negotiated
When concluding a purchase and sale transaction, be sure to register the rights and obligations of the parties in the documents.
Specify the seller’s obligation to transfer the goods to the buyer within the time specified in the contract. For example, within five working days from the date of signing. Write down the conditions for the transfer of the goods: method, address and additional items. For example, together with the transfer of goods, an acceptance certificate is signed. The form of the act can be drawn up in advance and attached to the contract of sale as an appendix. Indicate what the seller must hand over with the goods: warranty card, product passport, other technical documentation. Write down the buyer’s obligation to accept the goods and determine the deadline.
Be sure to take into account force majeure circumstances. This is a relevant point in conditions of uncertainty due to the restrictions associated with the spread of the coronavirus. If it is COVID-19 that can affect the transaction, mention it in the sales contract. Describe other conditions under which the parties are released from liability, and the procedure for dealing with the occurrence of such a case. For example, immediate notification of the parties to the contract. You can separately prescribe sanctions for not sending a notification.
It is important to take care of dispute resolution in advance. Specify how conflict situations will be resolved – during negotiations or in court. You can specify a specific court where the case will be considered on the fact of purchase and sale.
What other conditions are worth considering? It’s a good idea to specify the number of instances. For example, when buying real estate, the contract must be drawn up in triplicate, including for the registration authority. Agree on the date of entry into force of the document. Specify important aspects not specified in the document. They can be taken out to the application.
Also, the details of the parties are always prescribed: current addresses, registration numbers, contact details and payment details.
Separately indicate how to pay for the goods: the cost and method of payment. Write the price in rubles and decipher the words in parentheses. If the transaction is linked to a foreign currency, specify the exchange rate of the Central Bank on the day of the transaction. Also specify the payment method: cash, non-cash transfer from a card or a payment order through a bank to the organization’s current account. Set the payment order: 100% upon receipt or 100% prepayment. In other cases, a contract for the purchase and sale of goods with installment payment is concluded. Do not forget to indicate whether the amount is subject to VAT.
Additionally, when buying and selling indicate:
- Possibility of transfer of ownership. Specify the moment after which the ownership and all risks associated with ownership pass completely to the buyer. For example, from the moment of signing the act of acceptance and transfer.
- Quality assurance. Write down the documents (regulations and standards) confirming the quality of the goods. For example, GOST standards for industrial products.
- The order of shipment. This is an optional part of the contract. Filled in if the shipping process is a complicated procedure.
- Responsibility of the parties. Write down the fines and penalties for each day of delay under the contract: on the part of the seller (the goods did not arrive on time); on the part of the buyer (late payments). Determine the penalty – a percentage of the amount for each day of delay.
How to issue a purchase and sale agreement
The laws of the Russian Federation do not provide for a standard form of purchase and sale agreements. However, the legislation provides for mandatory conditions that must be taken into account in order for the document to be considered valid. We have listed the mandatory points of the transaction above, you can also focus on samples and templates accumulated over the years of legal practice. But it is always better to entrust the drafting of the contract to an experienced lawyer who will take into account all potentially controversial points and will be able to protect your interests.
You can compose a document by hand or in printed form – it does not matter. However, both parties must certify the transaction with their signatures. In some cases, it is mandatory to notarize the documents. When is his help needed? If we are talking about real estate transactions, transactions involving minors or dependents.
How to register a purchase and sale agreement
Some types of purchase and sale transactions require mandatory registration with government agencies. For example, real estate transactions are subject to registration in the Federal Register. To register an agreement, you will need to confirm ownership, as well as the absence of prohibitions and arrests on real estate.
You can submit documents through the MFC and the representative offices of the Cadastral Chamber. However, you can also register online – provided you have an enhanced qualified electronic signature. This can be done directly on the Registry website. Another way is remote registration, which involves on-site service. Finally, you can contact a notary to register a purchase and sale transaction.
Please note that you will have to pay a fee for state registration. Usually it is paid by the buyer. But it is not necessary to submit the receipt together with the rest of the documents. But there is no state fee for mortgage registration.
How to terminate the contract
The terms of termination of the contract of sale are prescribed in the text of the agreement. Each of the parties may specify special conditions for termination of the contract unilaterally or by mutual agreement. If there are no specifics, they are guided by the rules established by articles 451 and 453 of the Civil Code. In some cases, the agreement can be terminated in court.
How long is the contract valid
The purchase and sale transaction is indefinite. This means that it has no expiration date. This fundamentally distinguishes this type of agreements from lease agreements, which always assume a certain validity period. In the case of a purchase, ownership passes from the seller to the buyer permanently, without expiration dates and other time restrictions. The Contract comes into force at the time of its conclusion.
Creation of a contract of sale: Valen services
We provide a full range of legal services related to the purchase and sale of property. Our experienced lawyers will prepare the text of the contract, conduct an examination of the documentation, support the transaction. We provide legal services on a one-time and on an ongoing basis, we help representatives of small and large businesses, individuals, individual entrepreneurs. Our lawyers work with transactions of any complexity. Sign up for a consultation via the website or order a callback!