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General Terms & Conditions - How can you make sure that yours apply?, 30th August 2011

It is common practice for most businesses to have a set of general terms and conditions of sale and/or a set of general terms and conditions of purchase (T&Cs) in place.

By nature, these contain detailed and carefully drafted provisions to protect the business. However, in many cases, these are never properly incorporated into contracts with customers or suppliers and therefore will not apply in the event of any dispute over payment or delivery etc

So, how do can you ensure that your T&Cs are incorporated into your contracts? The general rule is that those which are the last set intimated between the parties prior to performance of the contract govern the contract. Performance can mean different things depending on the type of contract - for example, if a customer orders the manufacture of bespoke goods, then performance will take place when those goods are manufactured. Most commonly however, delivery will signal performance. Regardless of the type of contract, you should always aim to have "the last word" in all negotiations with customers/suppliers to ensure that your T&Cs apply.

Terms and conditions of sale

1. Issue T&Cs with all quotes. If a quote is provided by telephone, also follow up in writing with an order confirmation and a copy of the T&Cs. You should consider seeking return of a copy of the T&Cs signed by the customer at this stage to hold on file;

2. If a purchase order (or similar) is received from your customer in response to a quote, always follow-up with an order confirmation and a copy of your T&Cs otherwise any T&Cs attached to the purchase order from the customer will apply instead of yours, regardless of any statement to the contrary contained in your T&Cs. You should also make it clear in any correspondence thereafter that the customer's T&Cs are expressly rejected;

3. Always attach your T&Cs to invoices; and

4. Upload a copy of your T&Cs to your website and you can refer customers there on your paperwork instead of supplying a copy of the T&Cs as outlined at steps 1,2 and 3 above.

Terms & conditions of purchase

The opposite procedure to that outlined above should be followed in "purchase" transactions with suppliers.

If you would like any further information on this topic, please contact us.

Last updated: 2.54pm, Tuesday 1st May 2012

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