In circumstances where different, usually form contracts are exchanged upon offer and acceptance, leaving the court, in the event of a dispute as to the terms of the contract, to resolve a battle of the forms.
In Northrop, Justice Posner of the United States of Appeals wrote:
"Battle of the forms refers to the not uncommon situation in which one business firm makes an offer in the form of a pre-printed form contract and the offeree responds with its own form contract. At common law, any discrepancy between the forms would prevent the offeree's response from operating as an acceptance. There would be no contract in such a case."
In Butler, Lord Denning wrote:
"... where there is a battle of the forms, there is a contract as soon as the last of the forms is sent and received without taking objection to it. In some cases, the battle is won by the person who fires the last shot. He is the person who puts forward the latest term and conditions; and, if they are not objected to by the other party, he may be taken to have agreed with them."
In other words, the final document, sent prior to fulfilling the contract, is the contract, also known as the last shot doctrine.
Note that in Butler, the battle of forms was resolved in favour of the original document because it stipulated that its terms would "prevail over any terms and conditions in the buyer's order."
In Tywood, a battle of forms played itself out and then a purchase order came in which called for arbitration in case of dispute. The purchase order was never signed by the plaintiff. Justice Grange decided that the reference to arbitration had never formed part of the contract between the two parties. The court noted that the defendant did not draw the attention of the plaintiff to the arbitration clause nor did it complain when the plaintiff did not sign the purchase order.
Justice Grange adopted these words:
"... the battle of the forms ... each party seeking to impose its terms upon the other and seeking to avoid being bound by that other. The court's task is to decide what each party to an alleged contract would reasonably conclude from the utterances, writings or conduct of the other."
REFERENCES:
- Butler Machine Tool Co. v. Ex-Cell-O Corp. 1 WLR 401 (1979)
- Duhaime, Lloyd, Offer & Acceptance
- Northrop Corporation v Litronic Industries 29 F. 3d 1173, at page 1174 (1994)
- Tywood Industries Ltd. v. St. Anne-Nackawic Pulp & Paper Co. Ltd. 100 D.L.R. (3d) 374 (1979)