Layngross
T: +44(0) 1932 856463
E: derek@layngross.com
W: layngross.com

Dr Derek Ross is the Immediate Past Master of the Worshipful Company of Arbitrators.  He is a Chartered Arbitrator, Accredited Mediator, Conciliator, Adjudicator and Dispute Board Member, who accepts appointments in UK and worldwide as the neutral person in each of these construction dispute resolution procedures.  He is listed on to the FIDIC President’s List of Adjudicators.  Being also a Chartered Civil Engineer, he also accepts appointments as a Civil Engineering Expert Witness. 

If you feel Dr Ross can assist you, please call him for a no obligation discussion on +44 1932 856463, or simply reply to this email with your details.

Below is an article he has written, which he hopes you will find of interest.

 

INCORPORATING TERMS AND CONDITIONS

 

Businessmen could be forgiven for thinking that when two companies in contract with each other are arguing about which of their standard terms and conditions of business ('T&Cs') apply, the one who had the last word before the contract was performed must be right, and the other wrong.  However, the recent case of Transformers & Rectifiers Limited v. Needs Limited [2015] EWHC 269 (TCC) illustrates that this is not necessarily so, as it is possible that neither party has succeeded in incorporating its T&Cs into the contract, if neither has complied with the steps necessary for incorporation, which the judge held neither had in the case just mentioned, despite their lengthy course of dealing.

The first essential step is to bring the T&Cs you wish to incorporate to the attention of the other party before the contract is performed.  The second essential step is to be the last one to do so.  Frequently purchase orders are issued subject to T&Cs printed on the back.  Provided the supplier's attention is drawn to the T&Cs on the back, usually by a note on the front, and the supplier satisfies the order without further comment, the purchaser's T&Cs will apply, as in this scenario the supplier has simply accepted the terms of the purchaser's offer to purchase by its subsequent conduct.  Not infrequently however, the supplier will accept the order subject to its T&Cs.  This amounts to a counter offer to trade on the basis of the supplier's T&Cs.  In such circumstances, so long as the supplier has provided or drawn the purchaser's attention to the supplier's T&Cs by means of its acknowledgement of order, and the purchaser accepts delivery of the relevant goods and/or services without further comment, then the supplier will have successfully made the transaction subject to its own T&Cs.  A common reason for doing so of course is to limit the suppliers liability in the event of the supplies proving substandard.

Depending on the course of dealing between the parties, it may not be necessary to supply the text of the proposed T&Cs every time.  It will, for instance, frequently be sufficient simply to make reference on the face of the order or the acknowledgement of order to T&Cs previously provided, or offered to be provided, whether or not that offer to provide has been taken up.  It is however essential to put the other party on notice every time of the T&Cs applicable to that particular offer to purchase or offer to supply.  The last party to do so before the contract is performed will have successfully incorporated its T&Cs.  However, if neither party does so, despite their previous course of dealings, the T&Cs of neither will apply, and their transaction will be governed by their statutory rights.  If in doubt as to what that may mean within a give set of facts, it is always prudent to seek professional advice before deciding to take, or not to take, action in respect of a specific issue.

Dr Derek Ross

27 March 2015

 

Please Note: The foregoing article has been prepared by Dr Derek Ross for the general interest and benefit of readers.  It is not intended to be a definitive analysis of the law or of other matters discussed.  Neither does it create a client relationship between the recipient and Dr Ross.  Thus no liability is accepted in respect of any reliance placed on any statements made in the foregoing article.  Proper advice ought always to be taken before deciding to take, or not to take, action in respect of a specific issue.

 © 2015 Dr Derek Ross & Layng Ross Construction Disputes Resolution.

VIEW NEWSLETTER ONLINE | COMMENT
The contents of an attachment to this e-mail may contain viruses which could damage your own computer system. Whilst we have taken every reasonable precaution to minimise this risk, we cannot accept liability for any damage which you sustain as a result of software viruses. You should carry out your own virus checks before opening the attachment.