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Chapter 12: OFFER TO SELL GOODS
CHAPTER 12
Offer to Sell Goods
WHEN A SELLER receives an inquiry from a buyer, one option is to return an offer to sell the goods in an informal format, such as a letter. The letter usually is brief, containing only the essential terms of the offer. If the buyer places an order, the letter offer and the order will be sufficient evidence of your contract for enforcement purposes, but it is best used for one-time, smaller transactions when the parties are not establishing a continuing relationship. If you use such a letter, it is wise to append additional contract provisions that are more detailed. You might print them on the reverse side of the letter.
Sample Contract: Offer to Sell Goods (front side)
[seller’s letterhead] [date] [buyer’s company name] [buyer’s address] COMMENT: Your contract is binding against the parties who sign it. These parties should be identified by their legal names, company names, and addresses. A party who later needs to give notice to the other should use the address specified in the contract. Re: Sale of [identification of goods] Dear [Sir/Madam]: We thank you for your inquiry of [date] regarding the purchase of [identify goods]. We are pleased to offer you our most competitive price of [currency and amount, e.g., US$50 per case of twenty-five]. The minimum order is [amount and unit, e.g., twenty cases]. COMMENT: This clause covers the essential terms of the agreement, with the exception of delivery. The identification of the goods should be a specific description, which may include a model number. Consider attaching the description to the letter to ensure that the specifications are clear. Please note that our acceptance of your order will be subject to the conditions printed on the reverse of this letter. Also, your order will not create a binding contract between us. After we have received your order, we will confirm in writing our acceptance, at which time we will then have a binding contract with you. COMMENT: To avoid disputes over whether the buyer’s order constitutes an acceptance and creates a binding contract, you should make your intent clear. If you do not want to take the extra step of confirming the order, you may modify this provision to allow for formation of a contract on receipt of the order instead.
Special shipping terms for this order are as follows: [specify]. COMMENT: The preprinted, standard clauses on the reverse side of the letter will not usually be modified for the particular circumstances. If there are any special shipping requirements, be sure to include them in the letter. We will deliver the goods ordered to your address as stated above, unless you specify a different address in your order. The delivery will be within [number] days of our receipt of your order, unless we otherwise inform you. The terms of delivery are as follows: [specify]. COMMENT: Until you receive the buyer’s order, you will not be able to designate a delivery date. Your offer should nevertheless provide a means of determining that date. Another option is for the seller to notify the buyer of the delivery date at the time the order is confirmed.
If we do not receive an order from you by [date], this offer is withdrawn. We look forward to hearing from you. Sincerely yours, [signature of seller]
CONDITIONS OF SALE
1. AMENDMENTS TO CONDITIONS. No alteration, deletion, or addition to these conditions will have any effect unless the seller accepts the change in writing. 2. DESIGNATED DELIVERY TIMES. Any delivery time or date designated by the seller is an estimate only. The seller will notify the buyer of any delay and of a new estimated delivery date. If delivery is delayed more than thirty days after the date originally designated, the buyer has a right to cancel the contract by giving written notice to the seller at least five days in advance of the estimated delivery date then current. However, if the delay in delivery results because of the seller’s efforts to comply with particular specifications supplied by the buyer, the buyer will not have a right to cancel. In this event, the seller will notify the buyer of the delay and the parties will renegotiate another delivery date. The seller’s inability to meet the delivery date designated because the buyer has furnished particular specifications will not be a breach of contract. 3. FIRM PRICE. If the buyer places an order within the time designated in this offer, the price for the goods will remain firm notwithstanding any variation in the costs of producing the goods. 4. NO WARRANTIES. No express or implied condition or warranty is made regarding the life or wear of the goods supplied. Nor does the seller warrant the suitability of the goods for any purpose or use under any specific conditions, regardless of whether the seller may know or may have been informed of any purpose or use intended for the goods. 5. DEFECTIVE GOODS. If the buyer believes that any goods delivered are defective, the buyer’s only remedy will be to return the goods to the seller. The
buyer will not have any claim for loss, damage, or expense arising directly or indirectly from the defects. If the goods are returned to the seller and are accepted as defective, the seller will replace the goods as originally ordered, provided the buyer requests replacement and provided that replacement goods can still be provided.
6. NOTICE OF DAMAGE, SHORTAGE, OR LOSS. The buyer must present any claims for damage in transit, shortage of delivery, or loss of goods to the seller within [number] of days after the buyer receives the goods. The seller will not consider any claim for damage, shortage, or loss unless the buyer presents a separate written notice and claim to the carrier concerned. 7. LICENSES AND RAW MATERIALS. The seller’s acceptance of any order is subject to the seller’s receipt of all licenses required for purchase and manufacture and to the seller’s ability to acquire the raw materials. If the seller cannot complete an order because licenses or raw materials are unavailable, the seller has the right to cancel the contract.
8. STOPPAGE, DELAY, OR INTERRUPTION OF WORK. The seller has a right to suspend all deliveries and to add the time of that suspension to the period originally designated in the contract in the event that work in the seller’s business is stopped, delayed, or interrupted because of strikes, lockouts, trade disputes, breakdown, accident, or any cause whatsoever beyond the seller’s control.
9. FORCE MAJEURE. If the seller is unable to deliver the goods because of the occurrence of an event beyond the seller’s control—whether hostilities arise between nations, war is declared, a national emergency arises, the seller’s property or products are taken by the government, a natural catastrophe strikes, or otherwise—the seller will be entitled to notify the buyer that only partial deliveries will be made or that the contract is terminated.
10. INDEMNIFICATION FOR SPECIFICATIONS. If the buyer supplies particular specifications for the goods to the seller, the buyer will indemnify the seller against all damages, penalties, costs, and expense that result because the specifications infringe on any patents, designs, trademarks, or other intellectual property rights of any third parties. 11. INTELLECTUAL PROPERTY RIGHTS. All intellectual property rights associated with the goods—including but not limited to company names, trade names, trademarks, service marks, trade dress, patents, designs, and copyrights—remain the property of the seller, provided that any such rights associated with particular specifications supplied by the buyer are not the seller’s property. The buyer will not modify the goods or the design, packaging, or labeling of the goods in any way, and all advertising must specify that the seller owns the intellectual property rights. 12. ARBITRATION. The parties agree to submit any dispute under the contract to an arbitrator or arbitrators to be appointed by the parties. The parties will accept the arbitrator’s decision as binding. The arbitration will be conducted in accordance with the [name of arbitration rules]. 13. GOVERNING LAW. These conditions, and the contract, will be subject to and construed in accordance with the law of [country].
