Terms of Trade
Each time a party supplies goods and/or services to a customer, whether the parties know it or not, they are entering into a contract. In entering into a contract each party is afforded rights and assuming liabilities, responsibilities and obligations.
Terms of trade are designed to set out what these rights, liabilities, responsibilities and obligations are.
Terms of trade are drafted for the benefit of the supplier. Essentially the aim is to place the supplier of the goods and/or services in a more preferable position by drafting terms and conditions which benefit and protect the supplier.
Primarily, terms of trade are used to minimise any inherent risks or liabilities that may be involved with the supply of the goods and/or services. Key matters that are commonly dealt with in terms of trade include:
- Payment terms, such as when payment must be made and the consequences of a default;
- The provision of a guarantee or charge as security for payment due;
- Disclaimer of liability for damage, loss or injury associated with the supply;
- Assignment of the risk associated with the supply to the customer;
- Limitation of liability in the event that the goods and/or services supplied are defective.
- Saves and return policies.
- Consumer protection.
As a supplier it is important to have terms of trade that suit you and that are tailored to your particular business or industry class. It is also crucial that you understand the benefits and limitations of your terms of trade and understand the impact of the Trade Practices Act and similar legislation on your business dealings.
How We Can Help
We can assist by:
- Highlighting potential concerns and issues for your business;
- Drafting and tailoring your terms of trade to address your individual circumstances;
- Identifying your obligations under legislation.
For further information please contact: