A Brief Introduction About the Trailer Bill of Sale
A trailer bill of sale is used whenever any structure which can be towed by a vehicle is being sold. Trailers are used for the transfer of objects like vehicles, boats, or everyday storage items. Every trailer bill of sale will have a vehicle identification number, and this, along with all the relevant information relating to the trailer is provided. The buyer of the trailer would require the documents relating to registration of the trailer as per the laws of the state.
There are different types of trailer bill of sale, depending on the object being transported.
When a boat is being transported, a boat trailer bill of sale is used.
If a horse is being transported by a trailer, then a horse trailer bill of sale is used.
A homemade trailer is made by assembling the parts of two or more used trailers. The owner will have to provide receipts of the two old used trailers. A trailer bill of sale prepared for a homemade trailer is known as a homemade trailer bill of sale.
Who Takes the Trailer Bill of Sale Agreement? – People involved
A trailer bill of sale is exchanged between the buyer and seller of a trailer whenever the sale of a structure that is capable of being towed by another vehicle is involved. There are thus two parties to the trailer agreement, the buyer and the seller.
The agreement has all the details relating to the trailer like the model, the make, the number of wheels, and the vehicle identification number.
If you are interested in buying a trailer for any purpose, a trailer bill of sale is essential. The trailer bill protects the rights of both the buyer and the seller.
Purpose of the Trailer Bill of Sale Agreement –Why Do You Need It?
You need the trailer bill of sale as it serves as proof that the trailer being sold was registered and that the sale is legal. This bill is required whenever anything that is capable of being towed by a vehicle is sold.
The bill contains all the required details relating to the trailer, like the technical specifications and the price.
There are different kinds of trailer bill of sale, which depend on the type of trailers. There are hauling trailers (for boats), flatbed trailers, dry-van trailers, and vehicle carrying trailers. When a travel trailer, like a recreational vehicle, is being sold, then a travel trailer bill of sale would be required.
The agreement is made in accordance with the laws of the state from which the object is being transported. Therefore if there is a violation by either party of any clause in the agreement, the agreement will stand null and void.
The purpose of the agreement is to protect the rights of both the buyer and seller of the trailer.
Since the buyer signs the agreement after inspecting the trailer and its parts, the seller cannot be taken to court for deficiency in service.
If the payment for the trailer is made by the buyer as per the agreement, the seller is bound to deliver the trailer on time or face penal charges.
Contents of the Trailer Bill of Sale Agreement – Inclusions
A trailer bill of sale is an agreement between the buyer and seller of new or old trailers. Trailers are used for transferring various objects like vehicles, equipment, or boats, and they are towed by another vehicle. The agreement protects both the buyer and seller from any liability or fraud.
The following information should be included in a trailer bill of sale:
- Price Agreement and parties: The consideration paid for the trailer needs to be included. The mailing address and name of both the buyer and seller should be stated
- Trailer description: The complete description of the trailer with details such as the make, model, year, vehicle registration number and any other additional description
- Dates and signatures: The respective names, signatures, and dates of both the buyers and sellers along with the signatures of two witnesses are required
- Notary acknowledgment: The signatures of the parties to the agreement, as well as the witnesses, need to be notarized for the document to be official. The notary needs to issue a certificate of acknowledgment, which states all the information is true and correct.
- Laws of the state: The laws of the state which are applicable in case there is any breach of contract by either party
- Date of the agreement: The date of the trailer bill of sale must have the effective date of the agreement
- Date of delivery: The date by which the trailer needs to be delivered to the seller must be mentioned
- Warranty: The agreement must also include the warranty for the trailer being sold and the date of expiry
How to Draft the Trailer Bill of Sale Agreement?
Points to Consider While Preparing the Agreement
While preparing the draft for the trailer bill of sale, the following points need to be kept in mind:
- Names of parties to the agreement: The names of the parties to the agreement and the relationship shared between them need to be stated
- Type of trailer: The type of trailer being sold needs to be mentioned, including all technical specifications, especially the vehicle identification number, the registration details, insurance details if any, and so on.
- Price of the trailer: The price of the trailer including taxes payable on it, if any should be mentioned
- Signatures of the parties to the agreement: The signature of the parties to the agreement including the signatures of the witnesses should be present
- Notary acknowledgment: The bill of sale needs to be notarized for it to be legally binding
- Laws of the state: The applicable laws of the state which apply to such agreements need to be included
- Warranty: There should be a warranty for the product being sold, and this should be mentioned in the agreement
- Due delivery date: The date of delivery must be specifically stated, and the penalty for delayed delivery should be mentioned
- Termination of agreement: The events which lead to termination of the agreement should be included
Negotiation Strategy
When it comes to a trailer bill of sale, the buyer needs to inspect the trailer before buying it and negotiate the price. This is even more important in case the trailer being bought is not brand new. The buyer should engage a professional who has sufficient knowledge of trailers to assess the condition of the trailer and provide an accurate estimation of the value.
Benefits & Drawbacks of the Trailer Bill of Sale Agreement
The benefits of having a trailer bill of sale are:
- Protection of interest: The interest of the buyer and the seller of the trailer are protected with this agreement. The buyer has to pay the agreed price provided the seller has provided the right equipment mentioned in the agreement. The seller is assured of the consideration for the trailer provided there are no quality issues
- Insurance: Since the trailer is insured, should there be any damage the seller can pay the buyer from the insurance claim
- Warranty: The seller provides a warranty for the trailer so that if there are any defects later on the trailer will be replaced free of cost
- Disputes: The chances of disputes at a later date are minimized
The drawbacks of having a trailer bill of sale are:
- Disclaimer: There are certain disclaimers with respect to the warranty. If there are certain circumstances which are beyond the control of the seller, the damages to the trailer will not be covered by the warranty
- Claim for insurance: There are certain exclusions in an insurance policy with regard to goods being transported. The claim for insurance by the seller in the event of damage to the goods may not be entertained under certain circumstances.
What Happens in Case of Violation?
A trailer bill of sale is required when there is a transaction involving a trailer.
This bill is intended to protect the interests of both parties to the agreement, the buyer, and the seller.
The bill contains all the technical specifications with regard to the trailer being sold. Some of the important details that it contains are the vehicle identification number, make, and model.
The delivery details and the price paid by the buyer are also included.
If there is a misrepresentation of facts by the seller with regard to the trailer with regard to the condition of the trailer, then the applicable laws of the state will come into play, and the seller will have to reimburse the buyer for the trailer as well as any legal costs incurred.
The trailer being sold needs to be registered with the state in which the sale is taking place, and all applicable taxes need to be paid by the seller. If the trailer is not registered, then the sale is illegal.
If the seller of the trailer does not replace the trailer for any manufacturing defects during the warranty period, it amounts to a violation of the agreement(1). The buyer can approach the court to recover the amount paid for the trailer.
Whenever a trailer, either new or old, is being sold, a trailer bill of sale is mandatory.
The bill of sale depends on the object being transported. If both a boat and trailer are being transported, then a boat and trailer bill of sale will be required.
This is documentary evidence for the buyer that the consideration has been paid to the seller and the trailer received. It is admissible evidence in a court of law.
The interests of both the buyer and seller are protected due to this agreement. The seller is bound to deliver the trailer if the full payment has been received. If the seller does not honor the contract, then the buyer can realize the amount paid by taking the seller to court.
It is, therefore, always advisable if you are buying a trailer to get a trailer bill of sale.
[Also Read: Boat Bill of Sale]