Complete 7 pages APA formatted article: Business Law Questions. In accepting an offer, if an offeree introduces new terms or varies the terms of the offer, this will not constitute a valid acceptance but will be viewed as a counteroffer. For example, in the case of Hyde v Wrench, the defendant’s offer to sell was not unconditionally accepted, the plaintiff responded with a counteroffer, hence a contract did not come into existence and there was no obligation of any sort between the parties. In this case, Doors Software placed an order on 5 May 2003, with additional items included, such as the installation of the servers at 10,000 pounds, rather than the 15,000 pounds suggested by Hard Water Co and a change in the delivery time frame. This is likely to be viewed as a counteroffer, rather than an acceptance of terms. On this basis, the original offer put forward by Hard Water Co which included the price variation clause will be deemed to have been rejected, applying the precedent of Hyde v Wrench.
According to Lord Denning, no contract will come into existence unless and until the acceptance has been communicated to the offerer. In this case, the counteroffer by Doors Software has been communicated to Hard Water Co as the order form. This order form does not contain a price variation clause, however, Hard Water Co has completed and signed the form and returned it to Doors Software without insisting on the price variation clause. On this basis, Hard Water Co will be held to have accepted the contract on the terms set out in the order form of the Doors Software Company.
The question of contracts that are generated through standard business documents, like the order form, etc was examined in the case of Butler Machine Tool v Excell-O-Corp which is very similar to the instant case. Plaintiffs sent a letter of offer to defendants on their standard form, stating that these terms and conditions were to prevail over buyer’s order form. The defendants, however, returned an order form with different terms and .conditions and with a tear-off slip.