Contract Of Sale And Agreement To Sell Template for Canada

The Contract of Sale and Agreement to Sell is a sophisticated commercial document used in Canadian business transactions where parties wish to combine an immediate sale with commitments for future transactions. This hybrid agreement is particularly valuable in ongoing supply relationships, allowing parties to establish both immediate and future obligations within a single framework. The document must comply with provincial/territorial Sale of Goods Acts and consider both common law principles (applicable in most provinces) and civil law requirements (in Quebec). It typically includes detailed provisions for current and future pricing, delivery schedules, quality standards, risk allocation, and remedy procedures. This type of agreement is commonly used in manufacturing, wholesale, and retail sectors where businesses need to secure both immediate supply and future commitments while maintaining flexibility for evolving commercial relationships.

1. Parties: Identifies and provides full details of the seller and buyer, including legal names, addresses, and registration details if companies

2. Background: Explains the context of the transaction and the parties' intention to enter into both immediate sale and agreement to sell arrangements

3. Definitions: Defines key terms used throughout the agreement, including specific descriptions of goods, delivery terms, and payment conditions

4. Sale of Current Goods: Details of the immediate sale transaction, including description of goods, price, and transfer of title

5. Agreement to Sell: Terms of the future sale arrangement, including conditions precedent and timing

6. Purchase Price and Payment Terms: Specifies the price, payment schedule, method of payment, and any conditions for both current and future sales

7. Delivery and Transfer of Risk: Specifies delivery terms, locations, timelines, and the point at which risk transfers to the buyer

8. Warranties and Representations: Details seller's warranties regarding the goods' quality, condition, and title

9. Inspection and Acceptance: Procedures for inspection of goods and criteria for acceptance or rejection

10. Title and Risk: Specifies when title passes and how risk is allocated between parties

11. Default and Remedies: Consequences of default and available remedies for both parties

12. Force Majeure: Circumstances excusing performance and procedures for handling such situations

13. Governing Law: Specifies that Canadian law governs the agreement and jurisdiction for disputes

14. General Provisions: Standard boilerplate clauses including notices, amendments, and severability