Whose Contract Terms Apply?

by Kidd Rapinet on September 9, 2010

Do you have terms and conditions of sale and purchase for your business? If so, have you successfully incorporated them into your contracts? If the answer to either of these questions is no, your legal position may not be properly protected.

Philip Wild, a partner in the Company & Commercial Dept. at Kidd Rapinet’s London office says:

“As soon as we are instructed in a legal dispute, the first question we ask is what are the written terms and conditions between the two parties. Often there are none. There will then be much less protection for the party without terms which favour its legal position.

“Sometimes it is not clear whose terms apply either. In a recent decision the courts had to look at whose terms applied, the so-called “Battle of the Forms” issue. GHSP makes electronic control systems for vehicles. It agreed to buy sensors from AB Electronic. The finished product was to be supplied to Ford to use in trucks. Some of the sensors failed with substantial losses, and big consequential loss claims followed. Each side’s terms favoured their own position. The court said neither set of terms applied, so that the Sale of Goods Act 1979 was the applicable law. The parties had negotiated about terms but had not agreed them. They had realised liability would be a difficult issue and just parked it.”

We can advise on how to make your terms apply and draft terms for you. If you have legal disputes later, we can help you resolve these.

Call Philip Wild on 020 7024 8029 for more information.

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