This is a simple guide to the main headings of the Terms and Conditions Contract. It will help you to understand the document.
We suggest you read this alongside the Terms and Conditions of Trade Document once you have downloaded it.
This is not intended as a substitute for the Terms of Trade Document that you purchase from this site, just a non-legal simplified explanation.
Wherever there is a doubt about the meaning of any part of the document you must rely on the original. This explanation is not an addition to the original nor does it form a part of it. What follows is not a legal document.
You will see the advantage that this contract gives you – especially when it comes to when the customer pays, how returns are handled or when good are damaged.
Definitions
These cover the four main words: Seller, Buyer, Goods and Price.
These words are at the centre of any agreement between you – the seller (or your employees or authorised agents) and the buyer (the person or business buying your goods or services).
When there are more than one buyer this definition explains that each named buyer is completely responsible for the whole of the agreement (particularly paying the Price). This is so that when one of the buyers disappears, or dies then the other one remains liable to pay the full amount of the price not just their “proportion”. (That is the meaning of “jointly and severally”).
The definitions of “goods” and “price” should be obvious, but both talk about what is at the centre of all buy/sell agreements, that is that one person offers something and the other accepts that offer.
When there is an offer and someone accepts the offer – that is the completion of a contract of sale. No real formality is needed.
So if I put a doggie in my window with a tag that says $10, and you see the dog and say “I’ll take that dog”. That is “acceptance” and creates a contract of sale. You have to give him the dog. He has to give you $10.
Acceptance
“Acceptance” occurs when someone places an order agrees for you to start work, accepts a quote (and a lot of other possibilities) whether it is face to face in writing or over the phone, or clicking “buy” on a website.
When you use our form the buyer will be bound by your YourTerms contract.
The contract can’t be changed without you agreeing to every change in writing.
Change in Control
This is designed to cover you if the buyer changes anything at all about “his” details.
It means you are entitled to rely on every detail about the buyer that they gave you at the time of making the agreement to sell something.
So, if he changes his address, and you make a delivery to his old address then unless he has notified you in writing, 14 days before changing address, he will be liable for the cost of the goods. If you were to pick the goods up and re-deliver to his new address, then he will be liable to pay your costs in redelivering the goods.
Obviously this will be most important where there is a change in ownership of the buyers business.
Price and Payment
This gives you as the seller a choice as to how the actual price is worked out – invoice price, price at time of delivery or quote price.
What is most important is the use of the phrase:
“Time for payment for the Goods being of the essence.”
This phrase is designed to make the agreed time for payment (4.4 a-f) crucial.
Failure to pay on time immediately means:
- interest is added on daily (and may compound monthly),
- costs of chasing up the money owed are to be paid by the buyer,
- any goods undelivered can be stopped and the remainder of the buyer’s order can be stopped.
Delivery of Goods
PPSA (Personal Property Security Act)
The purpose of this clause is to ensure that, especially in the case of insolvency of the buyer (“going broke”), you, the seller, will not have goods (which haven’t been fully paid for) sold under your nose to satisfy the debts of the insolvent buyer.
In the most general terms under PPSA Legislation such sales have become possible even though you formally might retain some “title” or “ownership” in the goods.
These sections in YourTerms require the buyer to set up a financing charge under the PPSA which will protect your interests.
Security and Charge
This is another way of ensuring payment.
In effect, you the seller, are able to recover money owed to you from any assets owned by the buyer.
Defects, Warranties and Returns
There are a number of guarantees about quality and usability of goods which can NOT be avoided or contracted out of (Competition and Consumer Act).
Beyond that YourTerms puts a strict responsibility on the buyer to “complain” about defects, shortages etc. Complaints must be written and made promptly (within 7 days).
Intellectual Property
If you design some goods for the buyer, you as the seller retain ownership in the design.
If the buyer gives you designs to create a product, it will not be your responsibility if there is a a breach of copyright.
Default and Consequences of Default
Failure to pay on time immediately means:
- interest is added on daily (and may compound monthly),
- costs of chasing up the money owed can be recovered by you and are to be paid by the buyer,
- any goods undelivered can be stopped and the remainder of the buyer’s order can be stopped.
Cancellation
This allows you as the seller to cancel any sale before delivery by giving a notice in writing to the buyer and repaying any money received.
You can not be held responsible for any losses the buyer has as a result.
However a cancellation by the buyer allows you to recover any losses (including loss of profits).
Privacy Act
This is designed to allow you the seller, to get Credit Reports and to use them in a wide range of ways.
Partly this is to let you to determine the creditworthiness of the buyer but also as a way of gaining compliance by giving you the right to share the buyer’s failure to pay with credit reporting agencies.
Unpaid Sellers Rights
When a buyer leaves goods with you which the buyer hasn’t paid for you will have a lien over those goods.
A lien allows you to keep the item until paid, or to sell the item to recover the money owed to you.
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