You're about to hand your car to a garage so it can sell it for you. Before you give up the keys, you sign a document: the consignment agreement. It often runs to just two or three pages. Yet it's the document that will answer the questions you'll be asking a few weeks from now. Who insures the car? What happens if your brother-in-law wants to buy it? When does the money reach your account? Here are the clauses to read, one by one, before you sign.
A mandate between you and the garage, not a sales contract
The consignment agreement binds two parties: you, the owner, and the garage. The buyer isn't part of it. At this stage, there is no buyer yet.
The contract with the buyer is a separate document. It's signed later, on the day of the sale. For that second document, see what the sales contract with the buyer should contain.
If the whole idea is new to you, start with how consignment selling works. This article assumes you've already decided and have a mandate in front of you.
The logic here is simple. Each clause answers a question you'll ask yourself one day. It's better to have the answer in writing beforehand than to argue about it afterwards.
The check-in report: dated photos, mileage, keys
On the day you hand over the car, the agreement or its appendix should record exactly what you're leaving. In practice:
- the odometer reading, with the date;
- the number of keys handed over;
- the service book and invoices;
- the other season's wheels, if you leave them;
- charging cables, the emergency kit and accessories;
- visible defects, listed one by one: scratch on the rear left wing, scuffed rim, marked seat;
- dated photos of all four sides and the interior.
Why so much detail? Because it's the only basis for settling a dispute when the mandate ends. A scratch nobody noted becomes a disagreement. A second key nobody counted goes missing.
Keep your own copy of the photos. A phone is enough, as long as the date is readable.
The agreed amount, written in francs, and who can change it
The agreement should state the agreed amount. In Swiss francs, not as a range.
It should also say exactly which amount this is. Is it the net amount you'll receive? Or the price shown in the advert? They're not the same thing, and people mix them up all the time.
Next, you need to know who can change that amount, and how. The sound rule: only with your written consent. An email is enough if the agreement says so.
One last point: offers below the agreed amount. Does the agreement say they'll be passed on to you? Within what time? A serious buyer won't wait a week.
To set a realistic amount from the start, look at what determines your car's price. An amount set too high doesn't protect you. It just makes the mandate last longer.
Duration, renewal and ending the mandate
Four points should be set out in black and white:
- the initial length of the mandate;
- renewal, automatic or not;
- the notice period for ending it;
- any fees linked to ending it.
A vague clause on how the mandate ends is a common source of friction. "Until the car is sold" is not a duration.
Depending on the situation, the law may also have a say in how a mandate ends. If a clause seems restrictive, ask the garage to explain it before you sign and, if needed, get advice from a legal professional.
Exclusivity: if you find a buyer yourself
These are the questions to settle in writing:
- Can the car stay advertised elsewhere during the mandate?
- What happens if a neighbour or colleague buys it directly from you?
- Is any amount owed to the garage in that case? How much?
Some mandates are exclusive, others aren't. Both make sense. With an exclusive mandate, the garage works on the advert without competing against you. A non-exclusive mandate leaves you free to sell on your side.
Which option you choose matters less than having the answer in writing beforehand, rather than negotiating it on the day the buyer turns up.
Taking your car back early
You change your mind. You need the car. Another solution comes along. It happens.
The agreement should state:
- how quickly you can collect it;
- which costs remain yours, for example preparation, photos or an advert already done;
- how the check-out report is made, compared with the check-in report.
Also have the agreement say how you give notice of withdrawal: in writing, and to whom. A phone call to whichever salesperson is on duty on a Saturday leaves no record.
In the showroom: who is liable for theft, hail or damage
With the showroom option, the car is in the garage's care. The agreement should state:
- who insures the car while it's there;
- against which risks: theft, fire, hail, damage while it's being moved;
- with what excess, and who pays it.
Ask to see the insurance certificate, or at least a written clause in the agreement. When something goes wrong, a verbal promise counts for nothing.
With the online option, the car stays with you. Your own insurance continues to cover it. Don't cancel it while the car is on consignment.
With the showroom option too, don't cancel anything until the agreement says who insures the car and what happens to the plates.
Test drives: who drives, and how far
These are the useful clauses:
- a member of the garage's staff on board during the test drive;
- a mileage limit, per test drive or over the whole mandate;
- the odometer reading before and after;
- the buyer's driving licence checked before setting off.
One question remains: who pays the excess if damage occurs during a test drive organised by the garage? The answer should be written down, not assumed.
To understand what third-party liability and comprehensive cover include, and how they affect your no-claims bonus, read who pays if the car is damaged during a test drive.
Payment and payout: a written deadline and a statement
The agreement should set three things:
- the payout deadline, counted from when the buyer's payment is received;
- the payout account: an IBAN in the name of the owner or owners, or the accounts the owners have agreed on;
- the statement provided at the sale: sale price, amount paid out and any fees.
It's the written statement that lets you check. Not trust, not a voice message.
Lease or loan still running: who settles what
If the car is still financed, the agreement should answer four questions. Who requests the settlement figure from the lender? Who pays the balance? In what order, relative to the buyer's payment? And what do you receive once the balance is paid?
These steps are explained in selling a car with an outstanding loan. For a lease, see also what it costs to end a lease early.
Who will sign the sale with the buyer
The mandate should say who will appear as the seller on the sales contract: you, or the garage. This isn't a mere formality. It determines who is liable for defects after the sale.
Ask for the agreement before you sign
A reputable garage will give you its agreement to read before you leave the car with it. Take it home and read it calmly.
The clauses to tick off:
- check-in report, with photos and inventory;
- agreed amount, in francs, and who can change it;
- duration, renewal and ending the mandate;
- exclusivity and direct sale on your side;
- early withdrawal and any fees;
- custody and insurance in the showroom;
- test drives: staff on board, mileage, excess;
- payout deadline and statement;
- lease or loan still running;
- seller named on the sales contract.
If a box stays empty, ask the question. The answer can be added to the agreement.
To see what the end result looks like, browse the cars the garage has already sold. Before you hand over yours, get in touch to ask for the agreement before you sign: you'll know exactly what you're committing to.
