Buying and selling privately
Overview
What to know before you buy goods privately
If you buy goods privately (rather than from a shop or other business), you’re not protected by the Consumer Guarantees Act 1993 or the Fair Trading Act 1986. For example, if you buy something from a garage sale, or from a private person on Trade Me or Facebook Marketplace, you’re not covered by the guarantees and protections under those Acts.
However, if you’re not covered by the Consumer Guarantees Act or the Fair Trading Act, you’re still covered under:
- the Contract and Commercial Law Act 2017, and
- the rules about contracts that have been established by past cases (“common law”).
What to know before you sell goods privately
If you are selling goods privately (i.e., not through a business) the Consumer Guarantees Act and Fair Trading Act do not apply. You’ll still have obligations to the buyer under the Contract and Commercial Law Act 2017 and the common law.
To avoid issues, you should make sure that you do everything you told the buyer you would (whether in writing or verbally). This includes making sure that:
- you have a right to sell the goods, meaning that you own them and don’t owe anyone any money for them,
- everything you told the purchaser about the goods is true,
- the goods aren’t faulty – or if they are, you’ve told the buyer about the faults before they buy it, and
- you deliver the goods to the person in the time agreed or in a reasonable time period.
What laws apply?
Contract and Commercial Law Act 2017, ss 135, 136
- The common law – the established a set of rules saying what happens when a contract is broken. If a seller of goods or a supplier of services has not done what they said they would in your contract with them (which may be written or verbal), you might be able to sue them for breach of contract and get compensation.
- The Contract and Commercial Law Act – the Act will automatically make the following things part of your contract with the seller (unless the contract explicitly says otherwise):
- the seller has the right to sell you the goods,
- no-one else (for example, a finance company) holds a security interest in the goods that the seller hasn’t told you about, and
- the goods are the same as any samples the seller showed you, and they match any description you were given.
Can a private buyer and seller agree to contract out of the Contract and Commercial Law Act?
Yes. Unlike the Fair Trading Act and the Consumer Guarantees Act, you can agree with the seller that these protections don’t apply to your contract.
