8 December 2011 | Oliver Jackson

1. Sellers should seek to 
ensure their standard terms are brought to the attention of buyers at the earliest opportunity. It is preferable that the offer is made by the buyer as the supplier will then know whether, and when, a contract has been entered into. The vendor can, for example, supply buyers with a standard order form incorporating the seller’s terms.

2. A party will make its 
‘offer’ by providing its standard terms to the other. These terms are ‘accepted’ by the other party signing them. Terms can also be incorporated into a contract by conduct (by performance of the contract) or as a result of a “course of dealing” (considered below).

3. Remember, in contract 
for the supply of goods, a seller, believing it is contracting on its own standard terms, can be at risk up to the time of the delivery of goods.

4. While the basic 
contractual principles of ‘offer’, ‘acceptance’ and ‘performance’ seem straightforward enough, the case law in this area shows the actions of the parties can easily create a confusing picture.

5. If you wish your standard terms to be the terms which prevail in a contract, you should ensure that reasonable steps are taken to bring them to the attention of the person with whom you are contracting prior to the performance of the contract.

6. You then need to be vigilant in ensuring that your terms are not subsequently trumped by any competing terms that your opposite number may wish to introduce (sometimes starting what is called a ‘battle of the forms’.

7. If you are in a 
longstanding trading relationship with another party then you may be able to argue that a course of dealing has been established on a given set of terms. This, however, cannot be relied upon and it is always safer to consider entering into a master agreement.

8. Suppliers should be 
careful to ensure that any proposals put forward for a contract are phrased so as not to constitute an offer, otherwise a buyer’s acceptance could form a contract before the vendor’s standard terms have been incorporated.

9. A supplier’s standard 
terms will often contain a clause providing that any purported acceptance by a buyer will only take effect as an offer on the seller’s standard terms and that no contract will be created until the seller issues its confirmation of the order.

10. If your standard terms are on the back of any contractual document, you should ensure you make reference to them, or to your trade association terms, on the face of the document.

☛ Oliver Jackson is a solicitor at Mundays.