I’ve long thought that the “battle of the forms” is easy to lose but impossible to win. That’s the perspective of a commercial attorney who approaches the issue from the front end—where the battlefield consists solely of varied hypothetical future situations. A litigator on one side or the other, of course, wins each battle that goes to trial.
The battle of the forms refers to the common practice of doing business via purchase and sale documents containing “small print” boilerplate and the interaction of each party’s boilerplate in determining the actual contract terms. Historically, small print terms were printed on the reverse side of the purchase/sale documents, but it is increasingly common for them to be located on the Internet. The key business terms, such as product, price, quantity, and delivery terms, are usually explicitly agreed upon, but the others, such as warranty, limitations of liability, and arbitration, are left un-negotiated.
Even though the value of business being transacted can be quite high, the parties rely on their boilerplate terms, statutory commercial law, and common law (plus, a belief that all will be well) for the remaining contract terms. At the time of contracting, no one knows the terms of the contract—other than those that are explicitly negotiated. If a dispute arises in a transaction involving the sale of goods, section 2-207 of the Uniform Commercial Code and the courts that interpret it are the arbiters of the conflict.
Although from a strictly legal perspective, it is risky to enter into a contract without knowing many of the terms, the ubiquity of the practice of relying on the battle of the forms indicates that the efficiencies gained are well worth the risk in many business situations. Thus, faith that all will be well with respect to the un-negotiated terms may be the most rational approach.
In future posts I’ll consider various aspects of the battle of the forms and UCC section 2-207, but for now I ask, can the battle of the forms be won, or can it merely be lost?