Monday, April 21, 2008

The Bearings of Sales Covenant

A common saying in commercial transactions relates, “Time is of the essence”. The implication of this observation is more on practicality and convenience. That, as much as possible commercial dealings must be closed at the earliest.

To achieve this end, a sales agreement was devised to facilitate commercial transactions among merchants and consumers.

Sales agreement is sanctioned in all jurisdictions around the globe. Specific laws of each jurisdiction are legislated regulating its provisions, stipulations and constitution.

A sales agreement is a contract that deals in the exchange of goods, services or property by the seller to the buyer for an agreed value in money or other compensation. It is a legally binding contract that establishes the respective rights and responsibilities of the merchant and consumer.

Whether you are dealing with goods, equipments, personal property, real estate, or cars, or whether you are engaging in wholesale or retail, specific sales agreement should be entered so that transactions become systematic and that the parties achieve their goal in an economic way.

The bearings of Sales covenant can be outlined under the following directions:

  • It provides practicality and convenience to the parties as well as its transactions expedited.
  • Sales agreement is a device in avoiding fraud.
  • It binds the parties to their specific undertakings and offer sufficient notice to third persons that intrusion is not allowed.
  • Make transactions between seller and buyer straightforward.
  • It contained detailed description of the goods or services for sale as well as the prestation or obligation of both parties to the contract, to avoid parties from unilaterally renouncing their specific undertakings.
  • It secures both parties against nonperformance or non-abidance of the terms of the contract. The party at fault may be held liable for damages.
  • Sales agreement ensures smooth transition of the transactions.
  • Evidenced the completion of a commercial activity, that is, the deal is closed.

With all these inputs, one important consideration that relates to both parties is the need for legal assistance of a lawyer.

On the part of the seller, it is wise that lawyer be waged in drafting the sales agreement so that all the constitutive elements of the contract are considered including its legal elements.

On the buyer’ part, it is advisable to have a lawyer review the document before signing so that legal rights are learned and protected.