A sales agreement governs the sale of goods between a buyer and a seller. It defines what's being sold, for how much, when delivery happens, and what warranties apply. Without one, the Uniform Commercial Code (UCC) fills in the gaps — but its defaults may not match your intentions.
Why the UCC defaults aren't enough
The UCC assumes a "merchant" is selling goods. Its default rules include:
- An open price term (the court decides a "reasonable price").
- No warranty disclaimers unless explicitly stated.
- Risk of loss passes at the point of delivery, not payment.
These defaults work for simple transactions but fail for anything complex.
Core terms
- Goods description — specific enough to identify exactly what's being sold (model numbers, quantities, condition).
- Price and payment — total price, payment schedule, payment method, and late fees.
- Delivery — when, where, and how. Include who pays for shipping and who bears the risk of loss in transit.
- Inspection period — how long the buyer has to inspect goods and report defects (typically 5–10 business days).
Warranties
- Express warranties — any promises the seller makes about quality, performance, or condition.
- Implied warranties — the UCC implies a warranty of merchantability (the goods work as intended) and fitness for a particular purpose.
- Disclaimers — sellers can disclaim implied warranties with clear language, but must do so conspicuously.
If you're selling "as is," say so explicitly. Without an "as is" clause, the buyer may claim implied warranties even on used goods.
Remedies and dispute resolution
- Remedies — repair, replacement, or refund. Specify which applies and when.
- Limitation of damages — cap consequential damages (lost profits, lost business) to prevent runaway liability.
- Governing law — specify which state's laws apply.
Make it legal
- Both parties sign.
- Each party keeps a signed copy.
- Attach any specifications, photos, or condition reports as exhibits.
A state-specific sales agreement drafted to your terms takes about ten minutes.