As is clause: selling goods in their current condition

Sample clause

a private sale of a 2014 hatchback by Marlo Quint, a fictional owner in Geelong who does not sell cars as a business, to a buyer who inspected it with a mechanic before paying

4. Condition of the Vehicle 4.1 The Buyer acknowledges that the Seller is a private individual and does not sell vehicles in trade or commerce. 4.2 The Vehicle is sold as is, in its condition on the Inspection Date, with all faults, whether or not they are visible or listed in the Mechanic's Report. 4.3 The Seller gives no warranty about the Vehicle's mechanical condition, fitness for any purpose or remaining life. A roadworthy certificate supplied with the Vehicle records its condition on the day of testing only and is not a warranty. 4.4 The Seller has disclosed these known faults: an oil leak from the rocker cover gasket and a cracked rear parcel shelf. 4.5 Clause 4.2 does not limit the Seller's promises in clause 3 that the Seller owns the Vehicle, has the right to sell it and that it is free of any security interest.

Sample wording, not legal advice.

Variants

What to negotiate

• List the known faults

  A seller who names specific faults is in a far stronger position than one relying on general words. A buyer cannot later claim for a fault it was told about, and a written list shows exactly what was disclosed. An as is clause is unlikely to help a seller who hid a known fault or described the goods falsely.

• Inspection before the money moves

  A buyer accepting as is terms should negotiate time for an independent inspection before paying the balance, with the deposit refunded if the report reveals a serious fault. The clause can then record the inspection date and the report, which ties the as is words to the condition the buyer actually saw.

• Keep the title promises

  Condition can be accepted as is, but ownership should not be. The buyer should insist on promises that the seller owns the goods and that no finance company or other secured party has an interest in them, backed by a search of the Personal Property Securities Register before payment.

The risk of leaving it out

Without an as is clause, a private seller still sits largely outside the consumer guarantees, but the parties are left to argue over what was said about condition in an advertisement, a message or a test drive. A business seller gains little from the clause in a consumer sale, because the guarantees apply whatever the contract says.

Who can rely on an as is clause

The ACCC says most consumer guarantees do not apply to one off sales between two people where the seller is not running a business, or to a traditional auction run by an agent of the seller. Three guarantees still apply in both cases: title, undisturbed possession, and no hidden debts or charges. A business that sells to a consumer, including second hand goods, cannot contract out of the guarantees, although the consumer cannot claim for faults it was told about or that its own examination should have revealed.

Used cars in Victoria

Consumer Affairs Victoria states that a licensed motor car trader must give a statutory warranty on a car less than 10 years old that has travelled less than 160,000 kilometres, lasting 3 months or 5,000 kilometres, whichever comes first. Faults listed on the defects notice are not covered. A car bought from a private seller comes with no statutory warranty and no cooling off period, and the warranty does not apply to a car sold at public auction.

Where it sits in a generated document

A generated vehicle sale agreement numbers condition as its own clause, so the as is words, the disclosed faults and the title promises read as separate sub clauses. Documents have no input fields, so each fault is written into the clause as text. The seller and the buyer each become one signer through the signature block, and the generated text does not cite sources.

Documents that carry this clause

Vehicle sale agreement templateA dual cab ute is changing hands between two people on the Central Coast for $28,500. No dealer, so no statutory warranty and no guarantee of clear title. What the buyer gets instead is five written warranties, a register certificate number, and a mechanic's report obtained before the balance moves.Boat sale agreement template with the hull ID, trailer and an as is clauseA private boat sale moves three things at once: a hull, a motor and a trailer, each with its own number and its own way of carrying a debt. This agreement lists all three in a specification table, gives the buyer a sea trial and a search before the balance moves, then sets out exactly what changes hands on the day.Motorcycle sale agreement with the VIN, odometer and roadworthyA private bike sale is usually settled in a driveway with a bank transfer and a handshake, and that is exactly when the roadworthy certificate and the finance search get skipped. This agreement records both before the money moves, along with the two numbers that decide whether the bike is what the advertisement said it was.Bill of sale templateA coffee roaster is selling four pieces of used cafe equipment to a cafe down the road for $34,100. The interesting part is not the price. It is that the buyer searched the register against the serial numbers three days earlier, and the search date is written into the warranty.

Questions people ask