One article: the inspection period of ordinary sales contracts

Author: Liuyan, legal director of a domestic technology group

Source: House of Justice

The sales contract is the most common type of contract in a transaction, and it is also the most commonly signed contract by enterprises, especially those that provide tangible products, which are directly related to the company's operating income. Signing a sales contract is often a process of strength contest between the two parties, in which there will always be a game about the inspection of goods.

Inspection is a scientific term that refers to the working process of using tools, instruments or other analytical methods to check whether various raw materials, semi-finished products and finished products meet specific technical standards and specifications. [1] "Inspection" under Articles 620 to 623 of the Civil Code is an important part of the buyer's quality control of the goods. As Article 12 of Chapter II of the Product Quality Law of the People's Republic of China stipulates that "product quality shall be inspected and qualified, and substandard products shall not be passed off as qualified products." ”

In the actual sales relationship, the buyer usually regards "completion of acceptance" or "passing of acceptance" as one of the prerequisites for payment regarding the time limit for product inspection, but the seller is worried: When will the buyer complete the inspection? How can the acceptance be considered acceptable? In fact, according to the seller's wishes, it is even more hoped that the goods will be collected as soon as possible after the delivery of the goods or even before the delivery, so as to get rid of the shackles of the inspection link.

In this case, how does the law stipulate the inspection period, and how should it be stipulated in the contract? This article will briefly sort out.

1. If it is not agreed directly, how to determine the inspection period?

If the buyer deliberately does not agree on the inspection period, the buyer shall inspect the goods in a timely manner after receiving the goods, and raise objections to the quantity or quality of the subject matter within a reasonable period of time, for a maximum of two years, and if there is a quality assurance period, it shall not be subject to the time limit of two years.

Article 620 of the Civil Code stipulates that when the buyer receives the subject matter, it shall inspect it within the agreed inspection period. If there is no agreement on the inspection period, the inspection shall be carried out in a timely manner.

Article 621 of the Civil Code stipulates that if the parties have not agreed on the time limit for inspection, the buyer shall notify the seller within a reasonable period of time if it discovers or should find that the quantity or quality of the subject matter does not conform to the agreed agreement. If the buyer fails to notify the seller within a reasonable period of time or within two years from the date of receipt of the subject matter, the quantity or quality of the subject matter shall be deemed to be in accordance with the agreement;

If the seller knows or should know that the subject matter provided does not conform to the agreement, the buyer is not subject to the time limit for notice provided for in the preceding two paragraphs.

Article 623 of the Civil Code stipulates that if the parties have not agreed on the inspection period, and the delivery note or confirmation note signed by the buyer indicates the quantity, model and specification of the subject matter, it is presumed that the buyer has inspected the quantity and appearance defects, unless there is relevant evidence sufficient to overturn it.

2. How to determine the "reasonable period" of inspection?

Inspection is a part of quality management and is subject to the quality assurance period according to Article 621 of the Civil Code. There is no definite standard for the reasonable period of inspection, which needs to be comprehensively judged according to the specific circumstances of the transaction, and belongs to the scope of the judge's discretion.

Article 12 of the Interpretation of the Supreme People's Court on Issues Concerning the Application of Law in the Trial of Cases Involving Disputes over Sales Contracts provides that when a people's court specifically determines the "reasonable period" provided for in paragraph 2 of Article 621 of the Civil Code, it shall take into account the nature of the transaction between the parties, the purpose of the transaction, the method of the transaction, the trading habits, the type, quantity, nature, installation and use of the subject matter, the nature of the defect, the buyer's duty of reasonable care, the method of inspection and the degree of difficulty, the specific environment in which the buyer or the inspector is located, Their own skills and other reasonable factors shall be judged according to the principle of good faith.

In judicial practice, if the acceptance period is not stipulated in the sales contract, the court will also determine the "reasonable acceptance period" in accordance with Article 12 of the Interpretation of the Supreme People's Court on Issues Concerning the Application of Law in the Trial of Cases Involving Disputes over Sales Contracts. For example, in a dispute over a contract for the sale and purchase of system equipment[2], the court determined that the reasonable period for the acceptance of the equipment involved in the case is from the date of completion of the installation of the equipment in question to the date of the end of the first heating period in formal operation, based on the results of the public service platform inquiry submitted, the monitoring results of the system equipment, and the actual use of the system equipment involved in the case. Similarly, in another dispute over a contract for the sale and purchase of a grease dosing machine[3], the court directly determined that the reasonable period of acceptance was six months based on the function, installation and use of the machine involved in the case, and other reasonable factors.

In addition, the court will also infer the true intention of the parties regarding the acceptance period based on the payment terms in the contract. For example, for such a payment agreement - "if the equipment is not installed or accepted on time as stipulated in this contract, Party A shall pay the payment for the equipment within 3 months after the delivery and receipt of the goods", the court held that the 3 months should be regarded as an agreement between the parties on a reasonable period of time for the acceptance of the goods. [4]

3. If a short inspection period is agreed, is it valid?

If the agreed inspection period is too short, it is only regarded as the time limit for raising objections to appearance defects, and quality problems are still limited by the quality assurance period.

Article 622 of the Civil Code stipulates that if the inspection period agreed upon by the parties is too short, and it is difficult for the buyer to complete a comprehensive inspection within the inspection period according to the nature of the subject matter and the trading customs, such time limit shall only be regarded as the time limit for the buyer to raise objections to the appearance defects of the subject matter.

If the agreed inspection period or quality assurance period is shorter than the time limit stipulated by laws and administrative regulations, the time limit provided by laws and administrative regulations shall prevail.

In the first instance civil case of a sales contract dispute (2020) Jin 1022 Min Chu No. 1076, the plaintiff and the defendant signed a special contract for processing and customization, stipulating that the defendant would provide 370,000 square meters of anti-grass cloth to the plaintiff, and after the agreement was signed, the defendant provided the anti-grass cloth, and the plaintiff paid for the goods. The plaintiff and the defendant agreed in the contract that "if Party A discovers a quality problem after the goods arrive at the construction site, it shall inform Party B in writing within five days to resolve it through negotiation, and if it is used, it shall be deemed that Party A has no objection to the quality of the product...... However, the court held that according to the nature of the anti-grass cloth, it is impossible to find the quality problem only by means of a short period of delivery, so it cited the above-mentioned article 622 of the Civil Code to determine that the time limit agreed by the two parties should be regarded as the time limit for raising objections to the appearance defects of the anti-grass cloth involved in the case. In the end, due to the defendant's serious breach of contract, the defendant should bear the liability for breach of contract and compensate the plaintiff for the losses caused thereby. [5]

4. Suggestions on the agreed inspection period

First, determine in writing the inspection period that is acceptable to both parties. For the inspection period of an ordinary sales contract, no matter whether it is too long or too short, it cannot really have the effect of avoiding or delaying acceptance. On the contrary, at the time of entering into a contract, it is more beneficial for both the buyer and the seller to estimate the inspection period and determine it in writing, according to the nature of the subject matter and the usual process time of the transaction.

Second, improve the corresponding acceptance clauses. In addition to determining a reasonable acceptance period, the corresponding acceptance standards, acceptance person, acceptance location, etc., can more comprehensively play the effect of early acceptance, and at the same time, there are also adjudication standards for handling disputes in the event of acceptance issues.

Third, the buyer shall perform its notification obligation in a timely manner. Article 621 of the Civil Code stipulates that "if the parties agree on the inspection period, the buyer shall notify the seller of the non-conformity of the quantity or quality of the subject matter within the inspection period." If the buyer neglects to give notice, it shall be deemed that the quantity or quality of the subject matter conforms to the agreement. "Regardless of whether or not the acceptance period is agreed, the buyer should notify the seller as soon as possible (written notice is preferable) when discovering problems such as the quantity or quality of the subject matter, so as to avoid protracted delays, problems with the acceptance period, obstacles to acceptance, and ultimately the purpose of the transaction between the parties may not be truly achieved.

[1] Baidu Encyclopedia query

[2] (2023) Liao 0291 Min Chu No. 550, Civil Judgment of First Instance of Sales Contract Dispute

[3] (2019) Ji 01 Min Zhong No. 13095, Civil Judgment of Second Instance of Sales Contract Dispute

[4] (2019) Jing 0111 Min Chu No. 26151, Civil Judgment of First Instance of Sales Contract Dispute

[5] (2020) Jin 1022 Min Chu No. 1076, Civil Judgment of First Instance for Sales Contract Disputes

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