Which of the following is a requirement for a Sale and Purchase agreement?

• A. Written form
• B. Oral form allowed
• C. No agreement needed for small vessels
• D. Only unsigned copy

Answer: (A)

The requirement being tested is that a Sale and Purchase agreement for a vessel must be in writing to be enforceable. In ship transactions, a written contract is typically required by law (often under the Statute of Frauds) to create binding rights and obligations. A written agreement clearly records essential terms such as vessel identity, agreed price, payment terms, delivery date, and any conditions like surveys or encumbrances, and it provides solid evidence of the parties’ intentions, which is crucial for transferring title and handling registrations or mortgage releases.

Relying on an oral agreement is risky and often not enforceable for a vessel sale, because the essential terms may be disputed or omitted, leading to disputes over what was agreed. The idea that small vessels can be sold without a contract is also not generally correct in formal practice, as even smaller transactions benefit from a written record. An unsigned copy wouldn’t bind the parties either; signatures (or authorized equivalents) are typically required to validate a contract.

So, the best answer is that a Sale and Purchase agreement must be in written form.