Battle of the Forms

Refers to the situation where each party to a commercial transaction has its own forms, e.g., order forms, acceptance or acknowledgement forms, invoices, shipping documents, etc. The problem that then arises is when the forms contain conflicting terms (and since each party writes the form to suit its interests and not the potential counter-party, this is likely.) Most people have seen versions of this this on say a delivery acceptance form, where above the signature-space there is a large amount of small print. In common law, this is dealt with using the so-called mirror image rule, where an acceptance must match the offer in every detail to be a valid acceptance. If there is a difference, the responsive document is considered a counter-offer.

The result can be what is known as the ‘last-shot rule,’ i.e., the governing terms are the last set out before acceptance, i.e., a clear ‘yes.’ In the United States this has largely been modified by UCC 2-207, which provides that an acceptance is a valid one unless it specifically conditions the acceptance on the earlier offeror’s acceptance of additional terms. However, the CISG explicitly includes a last shot rule in Article 19(2), so one should be wary in international commercial contracts.

One reason for entering into long-term commericial supply agreements is, by incorporating clauses excluding such ‘forms,’ to avoid the battle of the forms and achieve contractual clarity.