When does ownership pass to the buyer?
When the parties intend it to. A retention of title clause keeps ownership with the seller until the price is paid in full; without one, ownership often passes when the contract is made.
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Sale of goods agreement (England and Wales)
A sale of goods agreement records the sale of physical products: what is sold, the price, delivery, when ownership and risk pass, the quality promised and what happens if the goods are faulty. Between businesses the Sale of Goods Act 1979 fills any gaps; with consumers the Consumer Rights Act 2015 applies.
When you need one
Use one for any significant sale of goods between businesses — a one-off order or an ongoing supply — and whenever you need clear rules on delivery, retention of title and liability for defects.
What it should contain
Goods and specification
What is being sold, in what quantity and to what specification.
Price and payment
The price, whether it includes VAT and delivery, and payment dates.
Delivery
Where, when and how the goods are delivered, and what happens if delivery is late.
Risk and title
When the goods become the buyer's risk, and a retention of title clause so the seller stays the owner until paid.
Quality and defects
Warranties about the goods and the buyer's remedies for faults.
Limitation of liability
A cap on the seller's exposure, subject to the liabilities that cannot be excluded.
Points specific to England and Wales
- The Sale of Goods Act 1979 implies terms that goods match their description, are of satisfactory quality and are fit for purpose; between businesses these can only be limited if reasonable under the Unfair Contract Terms Act 1977.
Different rules can apply elsewhere in the UK: see the Scotland version of this guide.
Common mistakes
- No retention of title clause, leaving an unpaid seller as an unsecured creditor if the buyer becomes insolvent.
- Unclear delivery terms, so nobody knows who bears the risk of damage in transit.
- Trying to exclude the statutory quality terms against a consumer, which is not allowed.
See a specimen sale of goods agreement — a short illustration of the structure and key clauses, laid out as the app produces them.
Quick answers
Can a seller exclude liability for faulty goods?
Against a business buyer, only to the extent that is reasonable. Against a consumer, the statutory rights to goods of satisfactory quality cannot be excluded at all.
Draft your sale of goods agreement now
Be Contract Wise's powerful, carefully prepared drafting tools turn a short set of plain-English questions into a sale of goods agreement under the law of England and Wales, laid out to a professional standard, with an explanation of every clause. Simple or complex, export to Word or PDF.
Start drafting — freeBrowse all guidesReviewed 2026-09-24. General legal information about the law of England and Wales, not legal advice.