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Terms and Conditions of Trading
Whatever the nature of your business, you will be involved in buying and/or selling goods or services at some time.
Every time you do this you enter into a contract, but you may not always know the exact terms of those contracts, since many businesses simply rely on orders or quotations without considering the implications.
It is only when a problem arises about quality or delivery dates or specifications that it becomes obvious that more is needed to set out each party’s rights. You can't just rely on the Sale of Goods Act; its terms don’t offer much comfort to the supplier who doesn’t get paid when he thinks he should or who thinks that he has an automatic right to get the goods back if the buyer goes bust!
We know of one company that had to buy back it's own unpaid- for goods from the receiver of a customer company, at a significant proportion of the original invoice value to avoid the market being flooded in competition with its own sales. That loss of original price plus the cost of buying back (not to mention the humiliation of it all) only arose because they did not have a valid retention of title clause, which would have at least guaranteed return of their goods by the receiver. They had copied another company's terms, which unfortunately were drawn under English Law.
Standard terms and conditions of trading should be the cornerstone of your business contracts and could save you a lot of time and trouble.
Terms and conditions need to be tailored for each and every business. It is not unusual to find a company using standard terms, which have been copied from another company without any thought to whether they really apply. We have even seen standard terms 'adapted' by companies from terms used by competitors, which were almost complete gibberish to begin with. Don't assume that others, even if they are bigger than you, will have got it right, even for them. Concentrate on getting it right for you.
Under the Unfair Contract Terms Act 1977, there are limits on how far a business can go in stipulating its own terms and there are real dangers in simply stating what you want the position to be. After all, there’s no point in having terms and conditions which are unenforceable.
Purchase Conditions
Although not commonplace, it can be very important to certain types of business to make sure that you are able to control your purchases. For example, if deadlines are vital to you, then you’ll want something in place to say so. This is particularly true if you will be selling on to a third party who could sue you for late delivery. On the other hand, you may be more concerned that the goods or services meet your own high specification. Again, it is good to set this out in black and white and to at least have a starting point for any disputes.
Consumers
Specific regulations govern consumer contracts such as The Unfair Terms in Consumer Contracts Regulations 1994 and the General Product Safety Regulations 1994 so care has to be taken in drafting conditions in contracts with consumers.
Summary
It is in your interests to have terms and conditions in place. You’ll only miss them when there’s a problem and, as all businesses are aware, problems can be an enormous drain on resources, which could be better put to use in running a successful enterprise.
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