Legal Guide: Essential Contracts for Professional Car Sellers

In the world of used vehicle trading, professional sellers must comply with a series of legal obligations to protect consumers' rights and avoid potential conflicts.

This detailed guide will help you understand the essential contracts you should use as a professional car seller, as well as the key clauses and responsibilities involved.

Content

1. Importance of contracts in car sales

2. Vehicle sale contract with warranty

3. Legal obligations of the professional seller

4. Essential clauses in sales contracts

5. Legal and commercial warranty: differences and application

6. Seller's liability for hidden defects

7. Documentation required to formalize the sale

8. Importance of offering digital signature

9. Recommendations for a safe and transparent transaction

Importance of contracts in car sales

The sale of vehicles is a complex activity that involves risks and responsibilities for both parties involved. This is why contracts play a fundamental role, as they establish the rights and obligations of each party, protecting their interests and avoiding potential future conflicts. A well-drafted and detailed contract is essential to ensure a safe and transparent transaction.

Moreover, in the case of professional sellers, contracts are an indispensable tool to comply with legal obligations and avoid penalties or claims from buyers. An appropriate contract protects both the seller and the buyer by clearly establishing the terms and conditions of the sale.

Vehicle sale contract with warranty

The vehicle sale contract with warranty is the main document that should be used in the sale of second-hand cars by a professional seller. This contract must include detailed information about the vehicle, the parties involved, and most importantly, the conditions of the legal warranty that the seller is obliged to offer.

Some key elements that must be present in this contract are:

• Seller and buyer information

• Complete description of the vehicle (make, model, year, license plate, VIN, etc.)

• Sale price and payment method

• Legal warranty period (minimum of one year, according to law)

• Conditions and limitations of the warranty

• Date of delivery of the vehicle

It is important to highlight that, according to the General Law for the Defense of Consumers and Users, the professional seller must offer a two-year legal warranty. However, this warranty may be reduced to one year if both parties agree in writing in the contract.

Legal obligations of the professional seller

Professional car sellers have a series of legal obligations that they must comply with to protect consumers' rights. Some of these obligations are:

1. Offer a minimum legal warranty of one year: As mentioned earlier, the law states that the professional seller must offer a two-year legal warranty, but this may be reduced to one year if agreed upon in writing in the contract.

2. Answer for hidden defects: The seller is responsible for any hidden defects that may exist in the vehicle and were not evident at the time of purchase. This will be addressed in more detail in a later section.

3. Provide truthful information: The seller must provide accurate and complete information about the state of the vehicle, its maintenance history, and any other relevant information that may influence the buyer's purchasing decision.

4. Comply with consumer protection regulations: Professional sellers must comply with all regulations established for the protection of consumers' rights, including the provision of invoices, warranties, and other required documentation.

Failure to comply with these obligations can lead to administrative penalties, claims from buyers, and even legal actions.

Essential clauses in sales contracts

In addition to the basic elements mentioned earlier, vehicle sales contracts must include a series of essential clauses that protect both parties' interests. Some of these clauses are:

1. Warranty clause: This clause must detail the duration of the legal warranty, the coverage conditions, and any exclusions if applicable.

2. Dispute resolution clause: This clause establishes the procedure to follow in case of disputes or disagreements between the seller and the buyer, including the possibility of resorting to arbitration or the courts.

3. Property transfer clause: This clause indicates the moment when the ownership of the vehicle is transferred to the buyer, as well as the responsibilities of each party in the transfer process.

4. Limitation of liability clause: This clause limits the seller's liability in the event of damages arising from the use of the vehicle after the sale.

5. Confidentiality clause: This clause protects the confidential information of both parties, such as personal or financial data.

It is important that these clauses are drafted clearly and precisely, avoiding ambiguities or misinterpretations that may lead to future conflicts.

Legal and commercial warranty: differences and application

In the field of vehicle sales, it is important to distinguish between legal warranty and commercial warranty, as both have different characteristics and applications.

Legal warranty

The legal warranty is one that the professional seller is obliged by law to offer. As mentioned earlier, this warranty has a minimum duration of one year and covers any hidden defects or non-conformities that the vehicle may exhibit at the time of delivery.

The legal warranty is不可退出 and cannot be limited or excluded by the seller. Any clause in the contract that attempts to limit or annul this warranty will be considered null and void.

Commercial warranty

On the other hand, the commercial warranty is an additional warranty that the seller may voluntarily offer to provide greater protection to the buyer. This warranty may cover additional aspects such as maintenance or repair of certain vehicle components.

Unlike the legal warranty, the commercial warranty is optional and can be negotiated between the seller and the buyer. However, it is important to note that the commercial warranty cannot replace or limit the mandatory legal warranty.

In summary, while the legal warranty is a legal requirement that the professional seller must fulfill, the commercial warranty is an additional option that can be offered to provide added value to the buyer.

Seller's liability for hidden defects

One of the most important aspects that must be addressed in vehicle sales contracts is the seller's liability for the presence of hidden defects. According to the Spanish Civil Code, the seller is obliged to guarantee the absence of hidden defects in the sold vehicle that render it unsuitable for its intended use, or that diminish its usefulness to such an extent that, had the buyer known of them, the buyer would not have acquired it or would have paid less for it.

The seller is responsible for these hidden defects, even if they were unaware of them at the time of the sale. This is why it is essential to conduct a thorough inspection of the vehicle before proceeding with the transaction and to document its condition in the contract.

If the buyer discovers hidden defects after the purchase, they have the right to claim from the seller and request a repair, a price reduction, or even the resolution of the contract, depending on the severity of the defect.

Documentation required to formalize the sale

In addition to the sales contract, there are other documents that are necessary to legally and correctly formalize the sale of a vehicle. Some of these documents are:

• Sale contract: As mentioned before, this document is fundamental and must include all details of the transaction and the corresponding clauses.

• Proof of payment of the Transfer Tax (ITP): This tax must be paid in the autonomous community corresponding to the buyers tax domicile.

• Vehicle documentation: The seller must provide the buyer with all documentation related to the vehicle, such as the circulation permit, technical data sheet, maintenance history, among others.

• Notification of sale: It is advisable for the seller to carry out a notification of sale before the DGT to avoid possible future liabilities related to the vehicle.

It is important to know that the process of transferring ownership of the vehicle must be completed within 30 days after signing the sales contract.

Importance of offering digital signature

The incorporation of the digital signature in vehicle sales contracts not only speeds up the signing process but also offers a series of additional benefits. The digital signature allows for rapid and secure validation of documents, guarantees the integrity of the contract, and significantly reduces the possibility of fraud or unauthorized alterations.

Additionally, the use of the digital signature facilitates the management and storage of contracts, eliminating the need for physical spaces and reducing the costs associated with printing and handling paper documents. This not only optimizes administrative processes but also contributes to sustainability and reduces the carbon footprint.

For all these reasons, it is highly recommended for professional sellers to adopt digital signature systems, which will allow for greater efficiency and security in all transactions.

Recommendations for a safe and transparent transaction

To ensure a safe and transparent transaction in the sale of second-hand vehicles, both sellers and buyers should follow certain recommendations:

• Thoroughly inspect the vehicle: Before proceeding with the purchase, it is essential to carry out a complete inspection of the vehicle, including a mechanical review and a history verification.

• Request a detailed vehicle report: The DGT offers the possibility to request a detailed vehicle report that includes administrative, technical, and maintenance information.

• Carefully read the contract: Both the seller and the buyer should read and understand all clauses and conditions of the contract before signing it.

• Make payment securely: It is advisable to use secure payment methods, such as bank transfers or certified checks, and to obtain proof of payment.

• Formalize the property transfer: It is essential to carry out the necessary procedures to legally transfer the ownership of the vehicle to the buyer within the established time frame.

By following these recommendations and fulfilling the corresponding legal obligations, both sellers and buyers can enjoy a safe and satisfactory transaction in the sale of second-hand vehicles.