UCC Battle of the Forms: Resolving Conflicting Terms in Orders, Invoices, and Related Documents

Description

The "battle of the forms" arises when there is a conflict between the terms and conditions in the form documents exchanged by contracting parties in a commercial sale of goods transaction. It is a complex and complicated area of contract law for attorneys due in part to the inconsistent application of UCC 2-207 by various jurisdictions as well as the increase in e-commerce transactions and the resulting increase in transaction documents. Losing the "battle of the forms" can cost a party hundreds of thousands of dollars.

The two key questions at the center of the "battle of the forms" are whether a contract exists and which party's terms govern the performance of the contract. Courts typically apply the "knock-out rule" when resolving a "battle of the forms" dispute. The rule allows conflicting terms to be "knocked out," or rejected, and replaced by UCC Article 2 gap-filler provisions if specific criteria are met.

Drafting comprehensive sales invoices, order forms, and related documents that specifically outline the intent of both parties and are signed by both parties is key to protecting the interests of both parties to the transaction.

Listen as our authoritative panel discusses recent case law trends involving the "battle of the forms" and best practices for counsel to minimize disputes over the formation of a sales contract and its governing terms.