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ConstructionPro Week, Volume: Construction Advisor Today - Issue: 101 - 03/31/2011

Coping With the “Battle of the Forms” With Suppliers

Dealings between a constructor and a material or equipment supplier can be tricky. A multitude of documents go back and forth. Each contains its own terms, sometimes conflicting with others. But there is agreement regarding price, quantity and delivery. The product is purchased and incorporated into the project. What happens, however, if there is a problem, a dispute? At what point was a binding agreement formed? Which terms and conditions governed the transaction?

In a recent Texas case, a subcontractor’s purchase order included precise specifications for the material it was buying. The supplier responded “as per your purchase order.” The material didn’t comply with the specifications. The supplier said it never agreed to the specifications. Under industry custom, contended the supplier, acknowledgment of a purchase order establishes price and quantity, but does not acquiesce to the terms and conditions of that purchase order.

This case illustrates the seriousness of the “battle of the forms.” The competing forms contain provisions addressing everything from the definition of the product to warranties and warranty disclaimers. How do you handle this situation? Is there a way to assure that your terms, not the “standard” terms and conditions of the other party, govern the transaction? I welcome your comments.

 

Featured in Next Week’s Construction Claims Advisor:

  • Government Specification Conflicted with Manufacturer Warranty
  • Payment Bond Rights Trump Arbitration Clause
  • Contractor Was LLC Despite Lack of Mention in Contract

 

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