Sales Contracts & Deposits

Sales Contracts

Whether you buy a brand new Gulet or a used Gulet directly from the owner, outlining the terms of the sale in writing is the best way to protect your interests, since oral agreements are good only as long as both parties agree. If you are dealing with a broker, they usually have a sample contract written with international laws.

A written agreement will eliminate or minimize questions and problems that could later turn a sweet deal at the dock into a sour one in court. By spelling out the obligations of buyer and the seller, as well as the time frame in which the sale is to take place, you have a legally binding, written document of the parties’ intentions.

It’s not necessary to have a lawyer write the contract, although this should be considered, especially if you are buying a high-ticket Gulet or are having one custom-built for you.

Most brokers use contracts printed with their name and address, but fill-in-the-blanks contract forms found in stationery stores will suffice. A handwritten agreement will also serve the purpose. Regardless of the form, both parties must sign the contract. If the sales agreement requires the signature of both the salesperson and owner, make sure both spaces are signed.

Basic Contract Terms

Sales agreements or contracts should include the following minimum information:

• Complete names and addresses of buyer and seller.
• Complete description of boat and engine, including make, model, year, and Hull Identification Number and engine serial number(s). A complete equipment list is a must.
• The purchase price, including a description of any deposits paid by buyer and how the balance will be paid. It should also describe the trade-in boat, if any, and its exact value.
• A firm delivery date describing when and where the boat will be delivered and the deal finalized.
• The boat’s condition at the time of delivery, including a complete list of the accessories and items that convey with the boat.
• A full description of any warranty from the dealer or manufacturer. When boats are sold in “as is” condition, recourse may be impossible if problems arise.
• Buyer’s contingencies: Spell out that the sale hinges on a satisfactory survey and sea trial and the ability to obtain acceptable financing and marine insurance.
• A statement that the boat is free of all liens and encumbrances. The seller should also assume all responsibility for debts incurred during his ownership.

Deposit

Most brokers and dealers require a 10% cash payment on a used  Gulet but a nominal deposit is enough to get the dealer to write a contract. Often, the deposit is placed in an escrow account, but this is less common with private party sales.

The seller may have a right to keep all or a portion of the deposit if the buyer backs out of the deal without cause. As a buyer, you should include as many contingencies as necessary to protect your interests, including satisfactory survey and sea trial, clear title, and ability to obtain financing and insurance. On new boats, a written delivery date is crucial.