The contract

As a lawyer you would think that we would have pored over the contract presented to us. There are things that a lawyer looks for: what is the governing law for example. Our contract said Scottish Law, but it contained lots of English law terms.

However, fundamentally, the contract is not really going to protect you before you buy. The two concerns that the seller will have are: do you have the money to pay the price agreed, and are you going to pull out after the survey has taken place. Usually the price will be agreed before the survey is carried out. In that way the purchaser will be able to negotiate a reduction in price if the survey discloses serious defects.

The concerns the buyer will have are how soon can I get the boat (or can I pay you the price later) and are there any hidden defects? The nightmare scenario for a purchaser is to buy a boat which appears sound, only to find that there are serious structural problems with, for example the rigging or the hull. A boat is difficult enough to sell without having a structural defect to deal with.

So what should you do when presented with a contract. A bit of advice from a lawyer never hurt, but you might have to pay for it, especially if you seek advice from a marine lawyer. The contract we were presented with was very poorly written, and difficult to follow. It was plainly a standard form of contract, and from our perspective some of it was nonsense. The law involved in buying a boat is not rocket science. Its not so much admiralty law, just plain old contract law. So, should we blindly sign the contract or try and change it?

At the end of the day we decided that we would not sign it until we got our survey report. Happily the report gave the boat the all clear. We were happy with the price, so instead of handing over a deposit, which was set out in the contract, we handed over the full price in exchange for the boat and its papers. We then signed the contract. As we had dealt with all the requirements in the contract already in terms of timescales we were happy that the contract, together with the survey report and the existing law, was the best we could do to minimise the risk.

That kind of approach is probably fine when you are buying from a private individual through a broker, and the amount paid is not huge. We were also in the lucky position of not having a great deal of competition, so there was no real time pressure. We were also happy that the boat was only suffering from wear and tear. If you were buying a new boat, which had not been put through its paces, and was fresh out of the mould you would probably spend a little more time on the contract.

It also works where, as we were, you are buying from a local individual with a local broker. There is nothing like a face to face discussion with a person you understand to iron out problems. If you were thinking about buying a boat in (say) France or Spain, then you should definitely seek local advice who will be able to guide you through any local practices.

November 2004