Objectives To understand the importance of contracts To be able to promote their use in the agro sector.
Presentation Map Definition of a contract Advantages of a contract Requirements for a valid contract Components of a sale of goods contract
Definition of a Contract Legally binding agreement; Two or more people; Creates a legal obligation, i.e., a duty enforceable by law.
Advantages of a Contract Communication tool Creates certainty Minimises risk
Requirements for a Valid Contract Offer and Acceptance Intention to be legally bound Free Consent of all parties Consideration/value Legal capacity to contract
Components of a Sale of Goods Contract Names & addresses of the parties Statement of intention to create a legally binding agreement Description of the goods
Components of a Sale of Goods Contract Price and terms of payment Warranties Delivery of goods and passing of ownership and risk.
Components of a Sale of Goods Contract Inspection of the goods before acceptance Severability and amendment Duration of the contract
Components of a Sale of Goods Contract Termination of the contract Conflict resolution Law applicable Signature and witnesses
Note: For ease of reference of farmers and traders, this contract template has been divided into two parts –Page one contains clauses that will vary e.g. parties, goods, prices and payment terms and the contract duration
Note: Page two contains clauses which are usually the same in most sale of goods contracts e.g. warranties, amendment, and conflict resolution