When performing a sales and purchase contract, the parties should pay attention to the implementation and inspection of the agreed contents of the contract. Typically, checking the legality of goods, whether the delivered goods are in accordance with the agreement between the parties; delivery-related issues such as location, time, and inspection of goods; the contents related to payment as well as ownership rights to the goods as agreed by the parties.
The conditions for goods
Firstly, the parties need to find out about the legality of the goods they are about to buy and sell because not all goods can be involved in business or trading. There are goods prohibited, restricted from or subject to conditional trading. For goods subject to conditional trading, they must fully satisfy the legally established conditions. This is the fundamental step, necessary to make the purchase and sale of goods.
Conditions on quantity, quality, method of preservation, packaging, etc. of goods shall be agreed upon by the parties when establishing the goods sale and purchase contract. Most goods put on sale in the market must have a label. The contents that must be shown on the goods labels include: the name of the goods, the name and address of the person responsible for the goods and the origin of the goods. In addition, depending on each type of goods, there are specific contents such as: expiry date, quantitative ingredients, technical parameters, safety factor information, etc. Monitor and ensure that the information written on the goods labels is accurate.
Goods do not conform to the contract
When the buyer thinks that the goods do not conform to the contract, they have the right to refuse. The Law clearly stipulates cases where goods are not in accordance with the contract. Examples of this can be cases where the goods unsuitable for normal use of goods of the same type, the purpose requested by the buyer, or not preserved or packed in the usual way for goods of the same type.
In this case, the seller shall be liable for any defect in the goods prior to the time when the goods have been delivered to the buyer, even if such defect is discovered after the buyer has received the goods; except that during the signing of the contract, the buyer knows about the defects of the goods but still accepts to sign, the seller is not responsible for any defects of the goods. Furthermore, if, after the buyer receives the goods, the defects of the new goods arise during use due to the seller’s fault, the buyer has the right to hold the seller responsible.
Goods inspection is an important step in their buying and selling process. This step is performed before delivery to ensure that the goods are delivered in accordance with the contract, limiting disputes arising. The seller must create conditions and assure the buyer to inspect the goods.
If the contract stipulates the carriage of goods, their inspection shall be carried out when delivered to the place of destination. After the inspection, the buyer must notify the condition of the goods, including the defects of the goods that the buyer is aware of. If the buyer fails to notify, the seller is not responsible for these defects. However, there are defects that cannot be detected by the purchaser during normal inspection. In this case, the seller is still responsible.
If the buyer fails to inspect the goods before the seller delivers the goods as agreed, the seller has the right to deliver the goods and the buyer must receive the goods according to the contract.
If the seller fails to deliver the goods compared to the contract, but there is still a deadline for delivery, the seller can still deliver the missing part within the remaining time limit. In case the seller delivers overtime goods, the buyer has the right to refuse such excess goods and must pay either the contracted or mutually agreed price.
For some goods with accompanying documents, the seller is obliged to deliver all documents related to the goods to the buyer. Documents can be attached to the goods or sent separately, depending on the agreement between the parties.
Place of delivery
Regarding the place of delivery, the seller is obliged to deliver the goods to the agreed place. However, some contracts do not have an agreement on this issue. Delivery place is legally agreed as follows:
- If the process of transporting goods from the seller to the buyer through many shipping intermediaries, the seller must deliver the goods to the first shipping intermediary in accordance with the agreement. And after the seller delivers the goods to the first carrier, although the buyer has not received the goods, the seller’s delivery obligations have been fulfilled and all responsibility for damage to the goods will be borne by the intermediary.
- If at the time of signing the contract, the seller knows the location of the goods warehouse, the place of loading or the place of production and manufacturing of the goods of the buyer, the seller must deliver the goods to that location. In fact, sellers often violate this content, saying that the contract does not specify the delivery location, to continue storing the goods at his warehouse and asks the buyer to come to collect these.
- If neither of the above two cases, the buyer must go to the seller’s business location and if there is no business location, to the seller’s place of residence when signing the contract to pick up the goods. In this case, the buyer bears a higher risk due to having to preserve the goods during transportation from the seller’s place of delivery to the buyer’s warehouse or business location.
The seller must deliver the goods at the time of delivery agreed in the contract. The buyer is obligated to receive the goods as agreed and to do all reasonable work to help the seller deliver the goods. Some contracts do not specify the time of delivery, or specify a general delivery term, making it difficult for the seller as well as the buyer to deliver and receive the goods. For example, in the contract, the delivery date is November 2012. In this case, the seller has the right to deliver the goods at any time in November and notify the buyer in advance.
If the seller delivers the goods before the agreement, the buyer has the right to accept or refuse to receive the goods. Therefore, the delivery of goods needs to have an agreement between the parties and a settlement plan when the delivery is not on time.
The problem of transferring risks in the purchase and sale of goods and a basic issue that the parties need to grasp. In case the goods are damaged in transit, will the seller or the buyer or the carrier be responsible? Therefore, the parties need to agree on the time of risk transfer to avoid disputes.
There is no agreement in the contract on the time when the risk is transferred, if the seller is obliged to deliver the goods to the buyer at a certain place, the risk of loss of or damage to the goods passes to the buyer when the goods have been delivered. Delivered to the buyer. If the contract does not stipulate the carriage of the goods as well as the definite place of delivery, the risk of loss of or damage to the goods passes to the buyer when the goods have been delivered to the first carrier. In specific cases, the time of risk transfer is regulated in greater detail.
Guarantee of the ownership to the goods
According to the law on goods sale and purchase contracts, ownership is transferred from the seller to the buyer from the time the goods are transferred. The seller must ensure that the buyer’s title to the sold goods is not disputed by a third party; the goods must be legal; the delivery of goods is legal. Regulations on legal goods mentioned above. The legal transfer of goods often requires import and export goods, tax requirements, means of transportation, etc.
In case the buyer requires the seller to comply with the model, formula, and detailed data provided by the buyer, the buyer must be responsible for complaints related to intellectual property rights violations.
If the goods are subject to pledge, mortgage, deposit, guarantee, etc., the seller must notify the buyer of the condition of the goods and this purchase and sale must be the agreed intention of the secured party.
The buyer is obliged to pay for the purchase and receive the goods as agreed. The buyer still must pay the seller for the goods if the goods are lost or damaged after the time when the risk is transferred from the seller to the buyer. In some cases, the buyer has the right to stop paying for the purchase if the buyer has evidence of the seller’s deception, the goods are the subject of a dispute, the goods delivered are not in accordance with the contract, unless otherwise agreed.
When buying and selling goods, determining the price and agreeing on the price is very important. The parties need to agree to fix the price and specify it in the contract. If the contract does not specify a price, the selling price of the goods shall be determined according to the price of such goods under similar conditions. The place of payment may be agreed upon by the parties, or the place of business or residence of the seller, or the place of delivery of goods and documents.
Dispute emergence in the purchase and sale of goods is unintended, not only causing loss of money and time, but also loss of reputation and business opportunities for the parties. The above notes will help businesses and traders in signing as well as performing goods sale and purchase contracts more conveniently, avoiding unnecessary disputes.
Through this article, we hope that businesses can fully equip themselves with legal knowledge to avoid risks and disputes arising in the process of purchasing and selling goods.