Car Sale Agreement

Car purchase or sale involves more than just a simple transaction. It requires a legally binding agreement to protect the rights and interests of both parties involved. A car sale agreement serves as a vital document that outlines the terms and conditions of the sale. The following are vital elements of a car sale agreement:

• Parties Involved

Begin the agreement by clearly stating the names and addresses of both the seller and the buyer. Include their contact information, such as phone numbers and email addresses. Ensure that the names are accurately verified using the original National Identity Card or Passport,

• Description of the Vehicle

Provide a detailed description of the vehicle being sold. Include essential information such as the make, model, year of manufacture, car registration number, mileage, chassis number and any unique features or modifications. This description should be extracted from the original logbook to ensure clarity and avoid any confusion regarding the specific vehicle being bought or sold.

• Purchase Price and Payment Terms

Clearly state the agreed-upon purchase price for the vehicle. Specify the currency in which the payment will be made. If the payment is to be made in installments or through financing, outline the payment schedule and any applicable interest rates or penalties for late payments. It is important to emphasize the required percentage of the deposit to be paid, typically 10%, and clarify that the full purchase price will be paid only upon successful transfer of ownership through the National Transport and Safety Authority Portal (TIMS).

Additionally, it is essential to agree on a mutually acceptable payment method, such as bank transfer, MPESA or cheque, and include those details in the agreement.

• Condition of the Vehicle

Describe the condition of the vehicle accurately. Disclose any known defects, damages, or issues with the vehicle’s mechanical, electrical, or structural components. If the sale is “as-is” without any warranties, clearly state that in the agreement. However, if any warranties are provided by the seller, specify their terms, duration, and any limitations or exclusions.

• Transfer of Ownership and Title

Outline the process for transferring the ownership and title of the vehicle from the seller to the buyer. Mention the completion documents, such as the original logbook and transfer forms, which should be provided by the seller. It is crucial to ensure that the seller has clear ownership rights and the authority to transfer the title.

• Delivery and Inspection

Specify the location and method of delivery of the vehicle to the buyer. Determine whether the buyer will inspect the vehicle before finalizing the sale and, if so, outline the timeframe for inspection. Include provisions for any necessary repairs or adjustments to be made before the vehicle is handed over to the buyer.

• Indemnification and Liability

Include provisions for indemnification and liability to protect both parties. Clarify that the seller is not responsible for any damages or accidents that occur after the vehicle has been transferred to the buyer. Likewise, the buyer should agree to hold the seller harmless from any claims, liabilities, or disputes related to the vehicle following the sale.

• Governing Law and Dispute Resolution

Specify the governing law of the agreement, which will determine the legal jurisdiction in case of any disputes. Outline the preferred method of dispute resolution, such as mediation or arbitration, to resolve any conflicts that may arise.

• Execution

Ensure that the agreement includes spaces for the seller and the buyer to sign and date the document. This step signifies their acceptance and agreement to the terms and conditions outlined in the car sale agreement.

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If you require further guidance or have any inquiries regarding car purchases in Kenya, please feel free to contact us. You can reach out to us via email at the following addresses: info@dmklaws.co.ke and dmklaws@gmail.com. Our team is dedicated to assisting you throughout your car acquisition journey!