Free sale agreement template
A free sale agreement template for Kenya, for the sale of goods — a vehicle, machinery, stock or furniture — under the Sale of Goods Act. It records the price, when the property in the goods passes, and the conditions and warranties sections 14 to 16 imply into every sale. For a sale of land you need a different document: Law of Contract Act section 3(3) requires writing, every party’s signature, and a witness to each.
What you still need to do
- Check this is the right document. The Sale of Goods Act governs GOODS. For land you need a sale agreement that satisfies Law of Contract Act section 3(3) — in writing, signed by all parties, each signature attested by a witness who was present.
- Disclose any charge, lien, loan or hire-purchase interest over the goods in clause 6(c). Section 14(c) implies a warranty that there is none except what the buyer was told about.
- Describe the goods exactly — for a vehicle, registration, chassis and engine numbers. Section 15 measures the goods against that description.
- Decide and write down the moment the property passes. Section 3(4) distinguishes a sale from an agreement to sell, and that is what decides who bears a loss before delivery.
- Transfer the ownership records separately where the goods have any: a vehicle log book is transferred through NTSA, and this Agreement does not do it for you.
- Each party should keep a signed original, and the seller should issue receipts for every payment.
Why each clause is here
Every clause in this document is drawn from the provision named beside it, and the wording of each provision was read in the Act itself. Where the law fixes something a document cannot change, this is where it says so.
Section 3(1) of the Sale of Goods Act: a contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration, called the price. 🔴 Describe the goods precisely. Section 15 implies a condition that the goods correspond with their description, so the description in clause 1 is not decoration — it is the standard the goods will be measured against if there is a dispute.
A money consideration is what makes this a contract of sale at all under section 3(1) — a swap of goods for other goods is not a sale under the Act. Writing the amount in words as well as figures is ordinary drafting practice against a mistranscribed figure, not a statutory requirement.
Section 3(4) of the Sale of Goods Act draws the line this clause has to fall on one side of: where the property in the goods is transferred to the buyer the contract is a SALE, but where the transfer is to take place at a future time or subject to a condition to be fulfilled it is an AGREEMENT TO SELL. Under section 3(5) the agreement to sell becomes a sale when that time comes or the condition is met. 🔴 Say which moment you mean. It decides who bears the loss if the goods are destroyed before the buyer takes them away.
Section 14 of the Sale of Goods Act implies all three of these into a contract of sale unless the circumstances show a different intention: a condition that the seller has a right to sell, a warranty of quiet possession, and a warranty that the goods are free from any charge or encumbrance in favour of a third party not declared or known to the buyer before or at the time the contract is made. 🔴 Limb (c) is why the disclosure blank exists. A vehicle with a bank charge on it can still be sold, but the charge has to be declared here — undeclared, the warranty is broken the moment the Agreement is signed.
Section 15 implies a condition that goods sold by description correspond with that description. Section 16 starts from the opposite rule — there is NO implied warranty as to quality or fitness — and then makes two exceptions that swallow most sales: under 16(a), where the buyer makes the particular purpose known so as to show reliance on the seller’s skill or judgment and the goods are of a description the seller deals in, there is an implied condition that they are reasonably fit for that purpose; under 16(b), goods bought by description from a seller dealing in such goods carry an implied condition of merchantable quality. 🔴 The proviso to 16(b) is why the "as seen" wording matters: if the buyer HAS examined the goods, there is no implied condition about defects that the examination ought to have revealed.
The Sale of Goods Act does not require a sale of goods to be in writing, witnessed or signed in any particular way — this clause is ordinary practice, so that each party can prove what was agreed. 🔴 It is NOT enough for land. A contract for the disposition of an interest in land must, under Law of Contract Act section 3(3), be in writing, signed by all the parties, and each signature attested by a witness who was present when that party signed.
The provisions, in the Act’s own words
Spacing is normalised for reading. Every word is the Act’s.
A contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a money consideration, called the price.
Where under a contract of sale the property in the goods is transferred from the seller to the buyer the contract is called a sale; but, where the transfer of the property in the goods is to take place at a future time or subject to some condition thereafter to be fulfilled, the contract is called an agreement to sell.
In a contract of sale, unless the circumstances of the contract are such as to show a different intention, there is— (a) an implied condition on the part of the seller that in the case of a sale he has a right to sell the goods, and that in the case of an agreement to sell he will have a right to sell the goods at the time when the property is to pass; (b) an implied warranty that the buyer shall have and enjoy quiet possession of the goods; (c) an implied warranty that the goods shall be free from any charge or encumbrance in favour of any third party, not declared or known to the buyer before or at the time when the contract is made.
Where there is a contract for the sale of goods by description, there is an implied condition that the goods shall correspond with the description; and, if the sale is by sample as well as by description, it is not sufficient that the bulk of the goods corresponds with the sample if the goods do not also correspond with the description.
where the buyer, expressly or by implication, makes known to the seller the particular purpose for which the goods are required, so as to show that the buyer relies on the seller’s skill or judgment, and the goods are of a description which it is in the course of the seller’s business to supply (whether he be the manufacturer or not), there is an implied condition that the goods shall be reasonably fit for that purpose
where goods are bought by description from a seller who deals in goods of that description (whether he be the manufacturer or not), there is an implied condition that the goods shall be of merchantable quality: Provided that if the buyer has examined the goods, there shall be no implied condition as regards defects which that examination ought to have revealed
No suit shall be brought upon a contract for the disposition of an interest in land unless— (a) the contract upon which the suit is founded— (i) is in writing; (ii) is signed by all the parties thereto; and (b) the signature of each party signing has been attested by a witness who is present when the contract was signed by such party