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What Is Delivery Of Goods?

What Is Delivery Of Goods?

Delivery of goods is an essential component of any business agreement. Read more about what this means and its function here.

20th August 2019

In business, an essential part of any agreement or contract is the delivery of goods. This is the crucial part of a contract between a buyer and seller as it ensures that goods are received in a timely fashion. It might be services or it might be products. Whatever the case may be, the delivery of goods outlines exact terms between the contracting parties. Adhering to these terms is key to keeping successful business rapport. Accordingly, this article outlines a few points to consider regarding delivery of goods.

Key terms

In regards to the delivery of goods, a contract should include a few really vital details in order for it to give a clear understanding of all roles and rights of contracting parties. A basic understanding of contracts goes a long way in business. It is best to have the below points in your agreement. Seek the advice of a contract lawyer if you are unsure about this process.

  • You should list the precise quantity of goods . It may be a number of items, or it may be an amount in time or hours given to a product or service. Sometimes, these may be approximate, but it is good practice to be as exact as possible
  • Terms and method of delivery. This lists the delivery mode. It could be files on a server. Or it might be the physical delivery of packaged goods. This should include the location, the time, and any other requirements which may affect the delivery of goods. For example, if the there is only a small window of opportunity for delivery given opening hours of a business, this must be stipulated
  • It should include contingency arrangements if for whatever reason the delivery of goods is not fulfilled in the manner that was agreed, or cannot be delivered
  • It should include the payment terms of goods. Whether it is agreed that deposits are paid with the full and final balance owing upon delivery. Or if the full and final balance is to be paid prior to delivery. Alternatively, full and final payment may be settled at the completion of delivery
  • A clause for late delivery, and any other costs incurred by problems with delivery
  • The agreement must make reference to any third parties holding goods as bailee for the benefit of the purchaser

Actual delivery

This is physical delivery. This occurs when goods are actually and physically given by a seller to the buyer for possession. For example, when you buy a car from a car showroom. You are gaining possession of the car. Therefore, you have received the actual delivery of goods.

Constructive delivery

Constructive delivery differs to actual delivery in that it is more a recognition of a right than a physical delivery. For example, the person who possesses the product will recognise that he or she has the goods for the benefit of and the disposal for the person who bought it. It can occur when a seller sells the product and agrees to hold it as bailee for the purchaser. It can also occur when a third party holds the products as bailee for a seller and agrees to hold them for a buyer. For example, this might be a carrier. This involves fiduciary duties between bailor and bailee. It is wise to have an understanding of these types of relationships also.

As you can see, it is not as easy as simply delivering goods. It can be a physical a concept as it is an intangible one. In any event, it is vital that you fulfil your delivery of goods agreement. If you are unsure about your situation, it may be worth speaking to a legal practitioner for advice.

Don’t know where to start? Contact us on 1800 529 728 to learn more about customising legal documents and obtaining a fixed-fee quote from Australia’s largest lawyer marketplace.

Paul Taylor

Paul is an intern at Lawpath, and is currently studying a combined Arts/Laws degree with a major in criminology at Macquarie University. Paul has an interest in legal tech, which complements his broader interest in cyber crime/security and the way in which it is changing the world.