The Concept and Essence of a Sales Contract
An international contract of sale, viewed through Georgian law, rests on the general model established by the Civil Code: under a contract of sale the seller must transfer to the buyer the right of ownership in property, hand over the documents associated with it and deliver the goods, while the buyer must pay the agreed price and accept the property purchased. This bilateral structure forms the essence of the contract and frames the parties' expectations on both sides of the transaction.
The question of price is particularly important in international trade: if the contract does not directly indicate the price, the parties may agree on the means of determining it. This implies that a price calculation mechanism — an exchange quotation, an index or another objective criterion — becomes a full-fledged part of the contract and ceases to be contested at the moment of performance. Well-drafted price clauses are therefore the first line of defence against cross-border disputes.
Freedom of Contract and Its Limits
The foundation of international commerce is the principle of freedom of contract: subjects of private law may, within the limits of the law, freely conclude contracts and determine their content. They may also conclude contracts that are not envisaged by law but do not contradict it — which allows commercial forms developed in business practice to enjoy legal protection rather than remain outside the system.
Freedom, however, is not absolute. Where one party to a contract occupies a dominant position on the market, it bears an obligation to conclude contracts and may not unjustifiably offer a counterparty unequal terms. In addition, persons who acquire or use property and services for non-commercial purposes or to satisfy essential needs may not be unduly refused the conclusion of a contract where the other party acts within its entrepreneurial activity — a protection of the weaker side that matters in mixed commercial-consumer supply chains.
Offer and Acceptance
A contract is concluded through the mechanism of offer and acceptance. A proposal to conclude a contract is considered an offer where it is addressed to one or more specific persons and the offeror, in the event of consent, is prepared to perform its proposal. A proposal addressed to an indefinite circle of persons constitutes merely an invitation to make offers, unless something else is directly indicated in it — therefore the publication of a public price does not yet create a contract by itself.
The time limit for acceptance is critical: where the offeror has fixed a period for acceptance, acceptance may be effected only within that period. In international transactions, where the parties sit in different time zones, the precise fixation of the period protects both sides from misunderstanding — once the period has expired, a reply no longer creates a contract, and the parties' subsequent conduct must be assessed accordingly.
Delivering Goods Free of Defects
The seller must deliver to the buyer goods free from material and legal defects — a requirement central to international supply contracts. Freedom from material defects means that the goods correspond to the agreed quality and purpose; freedom from legal defects means that no rights of third parties encumber them. Together these two dimensions define what the buyer may legitimately expect from an international delivery.
If the goods sold are defective, the seller must either remedy the defect or, in the case of generic goods, replace the item within the period necessary for that purpose. The seller bears the reimbursement of expenses necessary to remedy the defect, including the costs of transport, travel, work and materials. The seller may nevertheless refuse both cure and replacement where this would require disproportionately large expenses. Where the seller delivers defect-free goods in place of the defective ones, it may demand the return of the defective item.
The Buyer's Rights in Case of Defects
The buyer may, because of a defect in the goods, demand termination of the contract in the manner established by the Civil Code, and the seller must reimburse the expenses incurred by the buyer. This set of guarantees creates the balance that allows a buyer in international sale to expect the agreed quality of goods and, where quality falls short, to deploy different remedies — from cure to termination of the contract.
Frequently Asked Questions
What obligations do the parties bear?
The seller transfers ownership and documents and delivers the goods; the buyer pays the price and accepts the property. Where the price is not directly stated, the parties may agree on the means of its determination.
When is a proposal an offer?
When it is addressed to specific persons and the offeror is prepared to perform it upon consent. A proposal directed at an indefinite circle is merely an invitation to make offers.
What can the buyer demand for defective goods?
Cure of the defect, replacement of a generic item within the necessary period, reimbursement of expenses, or termination of the contract in the manner established by the Civil Code, together with reimbursement of expenses incurred.
Can the seller decline to cure a defect?
Yes — the seller may refuse both cure and replacement where this would require disproportionately large expenses. Where defect-free goods are delivered instead, the seller may demand the return of the defective item.
How We Help on Legal.ge
An international sales contract demands precise drafting — from the price determination mechanism to the rules for notifying defects. The specialists of Legal.ge assist in drafting and reviewing contracts, analysing offer-acceptance correspondence, and resolving disputes arising from defective goods. Contact us — we will review your situation and help protect your interests.