Justice for All

Determining the exact moment of delivery of goods or services has legal implications, including transfer of ownership and the risk of loss. The major differences between Europe and the US here is the use of Terms of delivery and of acceptance.

In Europe terms of delivery are standard terms of a company that apply equally to each buyer. In many countries they are deposited with public registers held by the Chamber of Commerce or the local court. Countries often also require that the terms are made known to the buyer at a given stage prior to the order or conclusion of a contract. A hodgepodge of rules exists. In some countries referring to the terms or reproducing certain clauses in the offer suffices. Elsewhere providing a summary on the back of the offer, invoice or other communication is required. A buyer may even be required to return the papers signed for approval. National rules governing the actual content of the terms differ to the same great extent.

In the US such standard terms do not exist, and therefore neither the depositing with public registers. Using standard terms is nonetheless important, and not just for an efficient sales or purchasing organization. For instance, other than in Europe, in the US no interest may be charged over late payments if this is not specifically allowed by either the contract or the delivery terms.

As a result, each sales offer refers to the specific terms that a seller wishes to maintain. Although streamlined, these conditions can be different per product group, type of customer or even per contract. The terms are usually sent along with the rate quote or offer description, and are attached to the contract so that it forms part of it. As this is a legal document it is lengthy, and the buyer likely needs to return either a signed copy or a statement that he has received and read the document.

Buyers usually also maintain terms of acceptance. When the terms of delivery are not properly conveyed, or where they do not regulate a certain subject, these terms of acceptance apply. When they conflict, complex rules decide which of the conflicting terms governs. This process is known as the ‘battle of the forms’. No attorney can assure winning this battle, at least not in a commercially viable way. The only way to be sure which terms govern is to avoid conflicting terms. This means negotiating all terms that are deemed important before the sale is closed and to include them in a signed writing.