Battle of the Forms – Lord of the Stranger Things

4 minutes reading time

The expression the “Battle of the Forms” refers to the situation frequently encountered, where businesses seek to contract with each other on the basis of their own and often competing standard terms and conditions.

Whilst, even for the most imaginative, the expression is unlikely ever to conjure images of Vecna or Mordor-like sieges, its significance should not be downplayed, even if the stakes (and the fate of humanity) may not be as high.

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Standard terms and conditions

In many cases, there may only be one set of terms and conditions in operation. If so, questions regarding their application and understanding the parties’ rights obligations under the contract may be easily resolved. But what if both sides have fired off their own standard terms and conditions in communications? What then, whose standard terms will apply (if at all)?

The outcome to that question may have wide-ranging consequences for you and your business and the rights and remedies available to you under the contract. For instance, under your standard terms, you might be entitled to suspend performance under the contract, exercise a lien over goods until your invoices are paid in full, or reasonably limit your liability for any breaches of the contract by you. Conversely, the other side’s terms and conditions might contain punitive provisions regarding performance, which you would otherwise not wish to agree.

Battle of The Forms

“The last shot” in negotiations

When approaching the question, the courts will usually determine whether the parties have reached an agreement on all material points and if that can be evidenced in writing and/or by conduct. Where the position can become blurred is where (in the course of battle or business) the parties fire across purchase orders, order acknowledgements, invoices and other pre-contract documentation, each of which contains the terms and conditions of the party firing the shot which is intended to represent “the last shot” in negotiations.

Unfortunately, there is no simple answer to the question, and cases are typically fact specific. There are, however, certain steps you can look to take which might improve your prospects of success long before a sword is drawn or a telekinetic blow is struck.

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Practical steps

  • Shot-gun– ensure your terms and conditions are included in as many pre-contractual documents as possible in a bid to fire “the last shot”, but be vigilant at all times; the other party may be looking to do the same.
  • Emails - Ensure footers to your emails contain “live” links to your standard terms and conditions online. Importantly, ensure those terms and conditions are maintained and up to date. If that isn’t something you can do, ensure that a complete pdf copy of your terms and conditions is sent with your email.
  • Telephone – If, which is often the case, a sale is negotiated by telephone or in person, make clear those discussions are handled based on your standard terms and conditions or, if necessary, expressly stated subject to the contract. Consider how you then go about documenting that agreement. For example, recording sales calls or sending a follow-up email to your customer setting out the terms of what was discussed and the terms on which you say an agreement has been reached.
  • Negotiate – If there are competing terms and conditions, then deal with the elephant or the Demogorgon in the room. Raise the issue with the other party head-on and look to negotiate. The time and expense may be worth it in the longer run, although there may be times when you are required to take a commercial view (for example, where the contract is low value or the services being provided are one-off and manageable from a risk perspective, or simply the other party is not willing to negotiate).
  • Framework agreement  - If there is likely to be a course of dealing between the parties, consider having a framework agreement in place from the outset, which makes clear the other party’s terms and conditions will not apply, even if they are sent at a later date. But beware, the question of whether the terms of that framework agreement apply may itself fall on whether the framework agreement represented the “last shot”.
  • Proceed with caution  - Ensure you do not inadvertently make any offers without first bringing your terms and conditions and their application to the other party’s attention. Should you not do so, you may give the other party the opportunity to accept that offer, but not before introducing its own terms and conditions.
  • Paperwork – Review and keep under review your pre-contractual documentation and processes.
  • Training – Through training and routine monitoring, ensure that all staff understand the importance of being on their guard, following the plan and winning the battle.

And if you don’t do those things, do not despair. All may not be lost, but it may make running up that hill significantly more difficult.

Battle of the Form Contract Negotiations

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