Forming Contracts – The Battle of the Forms
Published February 2010
At the end of 2009, the Court of Appeal considered whether a seller’s or buyer’s contract terms apply – commonly known as the ‘battle of the forms’.
The court upheld the traditional view that the terms of whoever is last to send theirs before the contract is made apply.
In practice, this means that businesses should ensure they have terms of sale and purchase in place. These should be sent out, and also included on new order forms, customer letters, brochures and websites. Firms should also consider sending them out once a year to all existing customers as a reminder and, in some cases, have customers or suppliers sign the terms.
In addition, businesses should always reject the other party’s terms, as well as order acknowledgement forms or have a stock response to order acknowledgements, as appropriate.
Many commercial disputes before the courts could have been avoided if the parties had had clear written terms in place.
