Purchase and Sale of Goods
Most buyers and sellers are aware of the necessity of recording their transactions. However, sometimes the mere inconvenience of documentation may cause one party to be careless and to find itself unable to claim rights hitherto taken for granted. These forms will facilitate the monitoring and documentation of purchase and sale of goods, so that the parties’ rights are preserved. You are also referred to the forms in Section 9, My Business.
The new Consumer Protection Act No 68 of 2008 (“CPA”) came into law on 29 October 2010. It is like a Bill of Rights for long-suffering South African consumers. The Act applies to most transactions in South Africa with two important exclusions, namely, transactions where the consumer is a juristic person (e.g. company or close corporation) whose asset value or annual turnover exceeds R2 million and transactions that constitute a credit agreement under the National Credit Act (“NCA”), but goods or services that are the subject of a credit agreement are not excluded from the ambit of the CPA. “Transaction” means in respect of a person acting in the ordinary course of business and this applies to the supplier of goods and services. Once-off transactions are not transactions in the ordinary cause of business. The CPA would therefore not apply to a private person selling his motor vehicle. The CPA does not apply to a sale or lease agreement between persons who do not sell or let in the ordinary course of their business. The explanatory notes to the forms refer to the CPA where applicable.
| Products | Category | Price | Action |
|---|---|---|---|
| 5.1 Agreement of Sale.doc A general agreement of sale to be used when the property is sold "voetstoots" (as it stands, with all its faults). It is important to note that a "voetstoots" clause does not protect the seller if he is aware of any defects in the goods sold and fails to make such disclosure to the purchaser before the sale is concluded.
A private seller is still entitled to include a voetstoots clause but in terms of Section 48(1)(c) of the CPA a supplier in the ordinary course of his business may not use a voetstoots clause. Sections 55 to 61 of the CPA deal with the consumer's rights to safe and good quality goods. The distributor and retailer each warrant that the goods comply with the standards of good quality within six months after the delivery of any goods to a consumer. A consumer may return the goods to the supplier, without penalty, and at the supplier's risk and expense, if the goods fail to satisfy the requirements and standards contemplated in Section 55. The supplier is obliged to repair or replace the defective goods or refund to the consumer the price paid. Section 61 imposes strict liability on a producer, distributor or retailer of any goods for any harm caused as a consequence of supplying unsafe goods, or a defect in any goods or inadequate instructions or warnings to the consumer pertaining to any hazard arising from the use of any goods, irrespective of whether the hazard resulted from any negligence on the part of such producer, importer, distributor or retailer. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.2 Agreement of Sale of Motor Vehicle Documents the sale of a motor vehicle. It is important to note that a "voetstoots" (as it stands, with all its faults) clause does not protect the seller if he is aware of any defects in the goods sold and fails to make such disclosure to the purchaser before the sale is concluded. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.3 Consignment Sales Agreement (2 pages) Contains the normal terms of such an agreement. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.4 Request for Quotation A letter requesting a quotation from the seller. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.5 Acceptance of Order C.O.D. Stipulates that goods must be paid for by cash on delivery and requires purchaser's confirmation thereof. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.6 Confirmation of Verbal Order Confirms a verbal order, attached to which should be the verbally agreed purchase or sales order. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.7 Qualified Acceptance of Order Confirms a verbal order subject to variations. The order should not be executed until the purchaser has accepted the variations because no agreement will have been concluded until then. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.8 Order Acceptance: Delivery in Lots Provides for the occasion when a supplier is unable to deliver an entire order at once, but will ship the goods in lots. The buyer must be notified of the supplier's intention. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.9 Sale-On-Approval Acknowledgement Agrees to ship goods on a sale-on-approval basis. The customer is given the right to refuse, within a specified period, any delivery found to be unsatisfactory. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.10 Acknowledgement of Sale on Consignment Documents the conditions of sale when goods are sold on a consignment basis. The goods remain the property of the consignor until sold. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.11 Return of Goods Sold on Approval Evidences the return of goods, sold on approval, within the agreed time limit. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.12 Warranty by a Supplier This is a warranty against defects with relief subject to conditions. Section 56(1) of the CPA is relevant since it relates to implied warranties of quality. It states as follows:
56(1) In any transaction or agreement pertaining to the supply of goods to a consumer there is an implied provision that the producer or importer, the distributor and the retailer each warrant that the goods comply with the requirements and standards contemplated in Section 55, except to the extent that those goods have been altered contrary to the instructions, or after leaving the control of the producer or importer, a distributor or the retailer, as the case may be.
56(2) Within six months after the delivery of any goods to a consumer, the consumer may return the goods to the supplier, without penalty and at the supplier's risk and expense, if the goods fail to satisfy the requirements and standards contemplated in Section 55 and the supplier must, at the discretion of the consumer, either-
(a) repair or replace the failed, unsafe or defective goods; or
(b) refund to the consumer the price paid by the consumer, for the goods. The section will not apply if the warranty relates to a once-off transaction by a non-trader. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.13 Demand for Delivery Instructions A demand by supplier for delivery instructions. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.14 Despatch Notice To be used to notify a customer of the mode and date of despatch of goods. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.15 Notice of Withholding Delivery Informs a prospective buyer that the delivery requested is to be withheld for a specified reason. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.16 Demand for Delivery A letter from the purchaser to the supplier requesting delivery in accordance with an order. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.17 Demand for Confirmation of Despatch Dates A demand for despatch arrangements to be furnished, failing which the contract will be cancelled. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.18 Notice to Stop Goods in Transit A notification to the carrier to stop delivery and return goods to sender. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| ?5.19 Notice of Cancellation of Order Used when the purchaser cancels the order as a result of the supplier's failure to deliver the goods within the agreed period. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.20 Cancellation of Undelivered Order Informs the supplier of the cancellation of the balance of undelivered goods. Whether the purchaser can cancel as such, depends on the circumstances, e.g. agreement and trade custom. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.21 Receipt of Goods Acknowledges receipt of goods purchased and declares whether the goods have been inspected or not. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.22 Notice of Rejection of Goods A notification by the purchaser to the supplier, of the rejection of goods and contains a list of possible reasons for such rejection. If goods received are found to be defective or non-conforming (i.e. they differ from those ordered), a buyer can elect either to reject the defective or non-conforming goods, or to accept the defective or non-conforming goods and claim a reduction in purchase price from the seller.
The purchaser's rights to good quality goods is set out in Section 55 of the CPA. The purchaser has a claim to repair or replace the goods or for a refund within six months. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.23 Notice to Elect to Accept Defective Goods Notifies the supplier of defective or non-conforming goods that the purchaser is willing to accept the goods at a reduced price. While the purchaser is entitled to a reduction in the purchase price, it is always preferable to negotiate the amount of such reduction by way of agreement between the purchaser and seller. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.24 Acceptance of Repudiated Order Protects the seller's rights when the buyer has either failed to accept delivery, or has prevented performance by the seller after acceptance by the seller of the order. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| ?5.25 Notice to Suppliers Restraining Gifts to Employees This notice curtails the chance of bribery. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.26 Notice of Defective Goods A notification to the supplier of a contingent claim by the seller. Rights are further entrenched by Section 55 of the CPA although the drastic contents of Section 61 may not grant any protection to the purchaser since both the seller and the purchaser could be liable to the customer jointly and severally in terms of Section 61(3). | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.27 Notice of Disputed Balance A notification to the supplier of a disputed balance, giving reasons and requesting adjustment of the account. | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |
| 5.28 Payment of Specific Accounts.doc | 05. Purchase & Sale of Goods | (2 credits) | Add to cart |