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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Tekdata Interconnections Ltd v Amphenol Ltd [2009] EWCA Civ 1209 (19 November 2009) URL: https://www.bailii.org/ew/cases/EWCA/Civ/2009/1209.html Cite as: [2009] EWCA Civ 1209, [2009] 2 CLC 866, [2010] 1 Lloyd's Rep 357 |
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COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM BIRMINGHAM MERCANTILE COURT
HH JUDGE SIMON BROWN QC
Strand, London, WC2A 2LL |
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B e f o r e :
LORD JUSTICE DYSON
and
LORD JUSTICE LONGMORE
____________________
TEKDATA INTERCONNECTIONS LTD |
Respondents |
|
- and - |
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AMPHENOL LTD |
Appellants |
____________________
WordWave International Limited
A Merrill Communications Company
165 Fleet Street, London EC4A 2DY
Tel No: 020 7404 1400, Fax No: 020 7404 1424
Official Shorthand Writers to the Court)
Mr Malcolm Chapple (instructed by Nelsons) for the Respondents
Hearing date : 22 October 2009
____________________
Crown Copyright ©
Lord Justice Longmore:
Introduction
The Facts
When I gave permission to appeal, I was troubled by this question because there was no sign in the pleadings that Tekdata wished to rely not on the traditional offer and acceptance analysis but rather on the conduct of the parties not only over their long-term relationship over 20 years but also after the conclusion of the relevant contracts. But I am now satisfied that Tekdata's skeleton argument made it sufficiently clear that (right or wrong) Tekdata wished to rely on the parties' overall relationship and that they would say that it was always their intention that Tekdata's terms were to apply. Any objection to this approach could and should have been taken at the time but was not and the Judge was therefore right to have proceeded to determine the second question.
Mr Tomson for Amphenol said the Judge was not so entitled and the traditional offer and acceptance analysis should be applied. The Judge relied on Butler Machine Tool Company v Excell-O Corporation [1979] 1WLR 401 in which Thesiger J had not applied that traditional analysis and said that the seller's quotation terms should prevail over the terms incorporated by the buyer's order because the seller's terms expressly said that they should prevail over any other terms. Lord Denning MR said (404 F-G):
"I have much sympathy with the judge's approach to this case. In many of these cases our traditional analysis of offer, counter-offer, rejection, acceptance and so forth is out of date. This was observed by Lord Wilberforce in New Zealand Shipping Co. Ltd. V A. M. Satterthwaite & Co Ltd [1975] AC 154, 167. The better way is to look at all the documents passing between the parties – and glean from them, or from the conduct of the parties, whether they have reached agreement on all material points – even though there may be differences between the forms and conditions printed on the back of them."
Applying that guidance he concluded that the contract was made when the seller returned a slip attached to the buyer's purchase order accepting the order on the buyer's terms. Mr Tomson pointed out that:
(1) in the end the traditional offer of acceptance analysis was applied even by Lord Denning.
(2) the other members of the court applied the traditional analysis, Lawton LJ saying expressly (405G) that the battle of forms had to be conducted in accordance with set rules;
(3) Butler's case was, therefore, no precedent for abandoning the traditional analysis.
i) The fact that the connectors were items of considerable sophistication which were to be fitted into engine control systems destined for use in Rolls-Royce aero engines. Any departure from agreed times of delivery or, even more importantly, the quality of degree of materials and workmanship as specified in the purchase order could have catastrophic consequences not only for Rolls-Royce business arrangements, but also for the general travelling public. (Para 23 of the Judgment);
ii) The connected fact that there had, a short time before the purchase orders were concluded, been in existence contractual commitments by Amphenol to the party beyond Tekdata in the chain of purchases (Goodrich in their previous incarnation of TRW Limited). They were the instigators not only of the specification for the connectors but also of the requirement that Tekdata had to obtain the connectors from Amphenol. The contractual commitment assumed by Amphenol to TRW/Goodrich was contained in what was called a Long Term Purchase Agreement dated 8th August 2001 which had expired on 30 June 2004, two months before the first relevant revisions to the relevant purchase orders had been made. That agreement committed Amphenol to make their supplies on terms which largely corresponded to those of Tekdata even if they were not identical. (paras 24-27 of Judgment);
iii) The fact that at no time before Amphenol served their Defence did they mention their own terms. (paras 36-48 of the judgment).
"31. I am satisfied that there was never any suggestion put forward to either of [the parties] that the terms and conditions of Amphenol were extant between the parties. Indeed, it would defy common sense in this particular commercial arrangement for the Amphenol terms and conditions to be part of any of these supplies. It would not be acceptable with everybody depending upon each other for time not to be of the essence, you can deliver the goods more or less when you like, or when it was imposed upon you by your own supplier, and also it would defy common sense for there to be no requirements for conformity to certain standards. Indeed, in one of the documents there is quite clearly identified that the Defendants signed up to and signed off something as conforming with one of the appropriate standards.
53……and it was well known between the parties, and certainly well known to those in the Defendant's office, Mrs Hagan and Mr Dolton, that those particular [Tekdata] conditions would be applied. Any attempt to say otherwise, in my judgment is wrong. I do not accept their evidence on that. "
"But such an outright rejection of the traditional analysis is open to the objection that it provides too little guidance for the courts (or their parties or their legal advisers) in determining whether an agreement has been reached"
and I might add 'on what terms'. The fact that Gibson was reversed by the House of Lords [1979] 1 WLR 294 adds considerable force to this comment of that very distinguished author.
Lord Justice Dyson:
Lord Justice Pill:
"Did the Defendants actually believe that by their conduct their own terms and conditions were appropriate, were extant in this case? Did they in fact rely upon them? This is a question where we can look at the conduct of the parties in some detail"
"And it was well known between the parties, and certainly well known to those in the [appellant's] office, Mrs Hagan and Mr Dolton, that those particular conditions [Tekdata's] would be applied. Any attempt to say otherwise, in my judgment, is wrong."
These findings of fact were not justified for the reasons given by Longmore LJ at paragraph 15. There was no basis for them.