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The most important aspects of a contract for the purchase or supply of goods or services are that terms and conditions of the contract are properly on notice to both parties before the commencement of the contract (i.e. upon the purchase order being made) or by way of a course of dealings over a period of time (where the terms and conditions have become accepted, although this can be less certain).  

In addition to the general mechanics of the operation of an agreement to buy or sell goods and/or service, both purchaser and seller should have agreed terms which include the following:

  • That the purchase order contains a specific description of what goods or services the company is providing, including details of the number, condition and price.  These can all be reflected in the order form.
  • Terms for payment: when, how, to where and the consequences of late payment.   
  • With regard to any rolling or ongoing supply, the terms and conditions will have to address the commencement, duration and method of termination of the agreement
  • The parties and the ability transfer the agreement to a third party.
  • Terms relating to supply, inspection, rejection and substitution of goods.
  • The effect of breaches of the agreement and remedies available and the general mechanics of the operation of the contract.

Although most trading arrangements proceed seamlessly, it is often the case that sooner or later a disagreement will occur and in these circumstances the only point of reference will be the agreed terms and conditions applicable to the sale and purchase of those goods and services and whether they were properly incorporated into the contract.

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