A consignment agreement is entered into where one party (the “consignor”) supplies goods to another party (the “consignee”) for the purpose of selling those goods. The consignor retains ownership of the goods until they are sold.

In a consignment arrangement, the consignee acts as an agent for the consignor for the purpose of selling the goods that are the subject of the consignment arrangement to third parties (i.e. consumers). Even though the goods have been supplied to the consignee, the consignee does not become the owner of the goods. The consignor remains the owner of the goods until they are sold when the consumer becomes the owner of the goods. The consignor may request that the goods be returned at any time, subject to the terms and conditions of the consignment agreement.

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About this Document

LegalVision’s LVDox™ Free Consignment Agreement sets out:

  • how consignment stock will be delivered and returned;
  • how consignment stock will be paid for;
  • the consignor’s obligations and warranties;
  • the consignee’s obligations and warranties; and
  • how the consignment agreement can be terminated.

The LVDox™ Free Consignment Agreement is a very basic consignment agreement.

If your consignment relationship is more complex, it’s important that you have a lawyer assist you to draft the following clauses:

  • a sophisticated personal property securities register (PPSR) clause which will protect the rights of the consignor and ensure you can register your interest with the PPSR;
  • a clause setting out stock take requirements;
  • a sophisticated dispute resolution clause;
  • a clause setting out insurance requirements; and
  • additional provisions in related to the rights, responsibilities and obligations of the consignor and consignee, particularly if an agreement has been reached on particular issues.

Pro Document Benefits

You can choose to upgrade your LVDox to a LVDox Pro document. Upgrading your legal document has the following benefits:

  • Consultation with a lawyer specialising in your industry
  • Review of the legal requirements for your business
  • Drafted specifically for your business and industry
  • Document reviewed and signed off by a lawyer
  • Covered by LegalVision’s professional indemnity insurance
  • We provide a fixed-fee service so there are no surprises

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