Should I use a long-form or short-form sale of goods agreement?

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Table of Contents

• Sale Contract – Assets – Short Form (Sale of Goods Agreement)
• Sale Contract – Assets – Long Form (Asset Buy/Sell Agreement)

LegalVision provides two separate documents for documenting the sale of an asset or assets. These documents are a short form (or simple) agreement and a long form (or more complex) agreement. A business solicitor can help you decide which is best suited to your business.

Sale Contract – Assets – Short Form (Sale of Goods Agreement)

A Sale of Goods Agreement is a simple agreement between the existing owner of an asset (usually referred to as the “seller” or “vendor”) and a third party that wishes to buy or purchase the asset (usually referred to as the “buyer” or “purchaser”).  The asset may be tangible (e.g. equipment or stock) or intangible (e.g. intellectual property (IP) or goodwill of a business).

The LegalVision Sale of Goods Agreement is designed to be used for relatively simple transactions where all the elements of a transaction happen simultaneously. This means that the asset is transferred and payment is made for the asset at the same time. If payment is to be made by instalments, ownership of the asset is to be transferred at a later date or the agreement of the parties is otherwise complex then this document is unlikely to be appropriate.

Sale Contract – Assets – Long Form (Asset Buy/Sell Agreement)

An Asset Buy/Sell Agreement is a more complex agreement between the existing owner of an asset (usually referred to as the “seller” or “vendor”) and a third party that wishes to buy or purchase the asset (usually referred to as the “buyer” or “purchaser”).  The asset may be tangible (e.g. equipment or stock) or intangible (e.g. intellectual property (IP) or goodwill of a business).

If all the elements of a transaction will not happen simultaneously and therefore the asset will not be transferred and payment made for the asset at the same time then  you should use the Asset Buy/Sell Agreement. This document allows for payments by installments, enables ownership of the asset to be transferred at a later date, contemplates the document being signed before completion and is in general more flexible than the Sale of Goods Agreement.