England and Wales Court of Appeals (Civil Division)
England and Wales Court of Appeals (Civil Division)
1. Battle Of Forms
2. Counter Offer
3. Price Variation Clause
“AN OFFER MADE AGAINST THE ORIGINAL OFFER.”
“THE COUNTER-OFFER KILLS THE ORIGINAL OFFER”
“Price Variation Clause (PVC) are
used in settling claims between
purchaser and supplier for
variation in the basic price of raw
materials from the period of
tendering till the date of
delivery.”
FACTS OF THE CASE
THE BUTLER MACHINE TOOL COMPANY
LTD EX-CELL-O CORPORATION (ENGLAND) LTD
(APPELLANT: SELLER) (RESPONDENT: BUYER)
ACCEPTANCE
• On the 5th June,1969 the Seller wrote this letter to the buyers: “We have
pleasure in acknowledging receipt of your official order dated 27 th May
covering the supply of one Butler Double Column Plane-Miller. This being
delivered in accordance with our revised quotation on 23 rd may for delivery
in 10/11 months, i.e. March/April 1970. We return herewith duly completed
your acknowledgement of order form”.
• No doubt a contract was then concluded.
• Note:The machine tool was not delivered until November 1970. By that time
costs had increased so much that the seller’s claimed an additional sum
of 💷2,892 as due to them under the price variation clause.
• The buyers,Ex-Cell-O Corporation, rejected to pay the excess charge.
ISSUES OF THE CASE
4. LAST SHORT DOCTRINE: The ‘last shot’ was fired by the buyers by attaching T&C to their
order which were materially different from those of sellers. Since, that order was received
and acknowledged without any objection to any of the T&C attached therewith, hence,
buyers’ terms will prevail.
5. Further, according to him,the document comprised in ‘battle of forms’ were to be
considered as a whole. Therefore,the acknowledgement made by the sellers was a final
document which makes it clear that the contract was on the buyers’ terms and not on the
sellers’ terms: and the buyers’ terms did not include a Price Variation Clause.
JUDGEMENT
Lord Justice
Bridge
1. Article 7 of the Schedule 2 of the Uniform Laws on the Formation of Contracts under
International Sales Act 1967 would not be applicable as this Contract does not fall under
international sales of goods.
2. He followed the Classical Doctrine Approach i.e. A counter offer amounts to rejection of an
original offer.
3. He observed that the buyers’ order was a counter offer which destroyed the offer made in
the sellers’ quotation.The sellers accepted “terms and conditions stated thereon” by
signing the tear-off slip and by delivering the machine, accepted that offer.
4. Therefore,the sellers could not claim the increase in price under the price variation clause.
• Hence, he too allowed the appeal and enter judgement for the defendants(buyers).
JUDGEMENT
Lord Justice
Lawton