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Conditional Sale Agreement for Canada

Conditional Sale Agreement Template for Canada

A Conditional Sale Agreement under Canadian law is a specialized contract where the seller retains title to goods until the buyer completes all payments, while allowing the buyer to take possession and use of the goods immediately. The agreement must comply with provincial Personal Property Security Act (PPSA) requirements and applicable consumer protection legislation. It typically includes detailed payment terms, security provisions, maintenance requirements, and default remedies. This type of agreement is commonly used in both commercial and consumer contexts where immediate possession of goods is desired but full payment is made over time.

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What is a Conditional Sale Agreement?

A Conditional Sale Agreement is a crucial document in Canadian commercial transactions where businesses or individuals wish to purchase goods while spreading payments over time. This agreement type is particularly useful when the seller wants to maintain security over the goods until full payment is received. The document must comply with provincial PPSA requirements and may also need to address consumer protection laws if the buyer is a consumer. It includes essential details about the goods, payment schedule, title retention, security interests, maintenance obligations, and default provisions. Commonly used in equipment sales, vehicle purchases, and other high-value transactions, the Conditional Sale Agreement provides protection for sellers while giving buyers immediate access to needed goods.

What sections should be included in a Conditional Sale Agreement?

1. Parties: Identification of the seller and buyer with full legal names and addresses

2. Background: Context of the transaction and brief description of the arrangement

3. Definitions: Definitions of key terms used throughout the agreement

4. Sale and Purchase: Description of goods being sold and basic terms of the sale

5. Purchase Price and Payment: Details of the price, payment schedule, and interest charges

6. Title and Security Interest: Retention of title provisions and security interest details

7. Delivery and Acceptance: Terms regarding delivery of goods and acceptance procedures

8. Representations and Warranties: Warranties regarding the goods and representations by both parties

9. Insurance and Risk: Requirements for insurance and allocation of risk

10. Default and Remedies: Events of default and available remedies

11. Maintenance and Use: Obligations regarding maintenance and permitted use of goods

12. General Provisions: Standard boilerplate clauses including notices, amendments, governing law

What sections are optional to include in a Conditional Sale Agreement?

1. Guarantee: Required when there is a guarantor for the buyer's obligations

2. Special Delivery Requirements: Used when specific delivery arrangements or installations are needed

3. Trade-In: Include when there is a trade-in component to the transaction

4. Assignment: Detailed assignment provisions if assignment rights are important

5. Import/Export Requirements: Required for cross-border sales

6. Software/Intellectual Property: Include when the goods include software or IP components

7. Training and Support: Required when seller must provide training or ongoing support

8. Return/Exchange Rights: Include for consumer transactions or when specific return rights are granted

What schedules should be included in a Conditional Sale Agreement?

1. Schedule A - Description of Goods: Detailed description of goods including serial numbers, specifications

2. Schedule B - Payment Schedule: Detailed payment terms including dates, amounts, and interest calculations

3. Schedule C - Delivery Schedule: Specific delivery dates and locations if multiple deliveries

4. Schedule D - Maintenance Requirements: Detailed maintenance and servicing requirements

5. Schedule E - Insurance Requirements: Specific insurance requirements and minimum coverage

6. Appendix 1 - PPSA Financing Statement: Copy of or reference to PPSA financing statement

7. Appendix 2 - Certificate of Acceptance: Form for buyer to acknowledge receipt and acceptance of goods

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Canada

Publisher

Ƶ

Document Type

Contract to Sell

Cost

Free to use
Relevant legal definitions







































Clauses






























Relevant Industries

Manufacturing

Automotive

Industrial Equipment

Construction

Technology

Agriculture

Medical Equipment

Transportation

Heavy Machinery

Office Equipment

Retail

Relevant Teams

Legal

Finance

Sales

Procurement

Risk Management

Operations

Compliance

Credit Management

Contract Administration

Relevant Roles

Sales Manager

Commercial Director

Legal Counsel

Finance Manager

Credit Manager

Procurement Manager

Contract Administrator

Risk Manager

Business Development Manager

Operations Manager

Chief Financial Officer

Compliance Officer

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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