How to Write a Retail Contract

A contract is an agreement that the law will enforce. Most retail contracts must be in writing. What determines whether a retail contract must be reduced to writing depends on the price of the goods the parties have contracted for. The exact dollar amount depends on the law of state in which in contract is entered into. Some states require that only contracts for the sale of good in excess of $5,000 be reduced to writing, while other states require that any contract for the sale of goods valued at over $500 must be in writing. Even if the contract is not required to be in writing, doing so is always prudent for evidentiary purposes should litigation arise concerning the enforcement of the agreement.

Difficulty: Easy

Instructions

1. Specify the quantity of goods to be sold. A "good" is a tangible, movable object at the time the contract is entered into. For example, if the contract is for the sale of 200 typewriters, the writing should specify this amount.

2. Identify the contracting parties. The writing should specify who the buyer and the seller is. The identification of the parties should be clear enough so that a court can determine who the parties are. For example, "my best friend" is likely to be too vague.

3. Indicate the price of the goods. A retail contract that does not specify the price can still be enforced, but the value of the goods will be determined by the fair market value of the goods, rather than the price the parties agreed to. The fair market value could be higher or lower than the price the parties had agreed to. For this reason, the price the parties have agreed to should always be specified in the writing.

4. Sign the contract. Although the general rule is that only the party against whom the contract is sought to be enforced is required to sign the contract, both parties should sign the contract. This is because it cannot be determined who will breach the contract when the contract is formed. If both parties sign the contract, both parties are protected.

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