{"id":8955,"date":"2026-03-23T11:16:02","date_gmt":"2026-03-23T11:16:02","guid":{"rendered":"https:\/\/rfblegal.co.uk\/?post_type=insight&#038;p=8955"},"modified":"2026-04-07T11:02:45","modified_gmt":"2026-04-07T11:02:45","slug":"qa-business-contracts","status":"publish","type":"insight","link":"https:\/\/rfblegal.co.uk\/tr\/icgoruler\/qa-business-contracts\/","title":{"rendered":"Q&amp;A: Business Contracts\u00a0"},"content":{"rendered":"<h2 class=\"wp-block-heading\"><strong>Q. What\u00a0makes a commercial contract legally enforceable in England and Wales?<\/strong>\u00a0<\/h2>\n\n\n\n<p>For a contract to be legally enforceable in England and Wales, it must&nbsp;contain&nbsp;four essential elements:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Offer \u2014 one party must make a clear offer to contract on specified terms.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Acceptance \u2014 the other party must accept that offer, without material qualification (a qualified acceptance is a\u00a0counter-offer, not an acceptance).\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Consideration \u2014 each party must provide something of value in exchange for the other&#8217;s promise. In a commercial contract this is typically the payment of money in exchange for goods or services.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Intention to create legal relations \u2014 the parties must have intended to be legally bound. Commercial agreements are presumed to have this intention; social or domestic arrangements are not.\u00a0<\/li>\n<\/ul>\n\n\n\n<p>In addition to these basic requirements, the parties must have legal capacity to contract (companies must act through authorised individuals), the subject matter must be legal, and the contract must not have been induced by misrepresentation,&nbsp;duress&nbsp;or undue influence.&nbsp;<\/p>\n\n\n\n<p>Most commercial contracts are valid even if not made in writing \u2014 English law does not&nbsp;generally require&nbsp;commercial contracts to be written or signed. However, certain contracts must be in writing (such as contracts for the sale of land, consumer credit agreements and guarantees), and it is&nbsp;almost always&nbsp;advisable to document commercial agreements in writing to avoid disputes about what was agreed.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Q. What\u00a0is a limitation of liability clause, and is it enforceable?<\/strong>\u00a0<\/h2>\n\n\n\n<p>A limitation of liability clause is a contractual provision that caps the amount one party can recover from the other&nbsp;in the event of&nbsp;a breach of contract or&nbsp;other&nbsp;claim. It may limit liability to a fixed monetary sum (for example, the value of the contract), exclude specific types of loss (such as consequential loss, loss of profits or loss of data), or both.&nbsp;<\/p>\n\n\n\n<p>In English law, limitation of liability clauses&nbsp;are&nbsp;subject to the requirements of the Unfair Contract Terms Act 1977 (UCTA) and, for consumer contracts, the Consumer Rights Act 2015. For business-to-business contracts, UCTA provides that:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A clause excluding or limiting liability for death or personal injury caused by negligence is void and unenforceable.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A clause excluding or limiting liability for other loss caused by negligence, or for breach of contract, is only enforceable to the extent that it is reasonable.\u00a0<\/li>\n<\/ul>\n\n\n\n<p>The reasonableness test under UCTA considers factors including the relative bargaining strength of the parties, whether the clause was drawn to the attention of the other party, whether the limited party could have obtained insurance, and the nature and value of the contract.&nbsp;<\/p>\n\n\n\n<p>Well-drafted limitation clauses that reflect the commercial realities of the contract \u2014 capping liability at an amount that reflects the contract&nbsp;value, or&nbsp;excluding consequential losses in an industry where such losses are typically uninsured \u2014 will&nbsp;generally satisfy&nbsp;the reasonableness test. Limitation clauses that&nbsp;seek&nbsp;to exclude all liability entirely, or that are buried in small print, are more vulnerable to challenge.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Q. What\u00a0is a force majeure clause and when does it apply?<\/strong>\u00a0<\/h2>\n\n\n\n<p>A force majeure clause is a contractual provision that excuses one or both parties from performance of their obligations&nbsp;in the event of&nbsp;exceptional circumstances beyond their control \u2014 circumstances that were not foreseeable at the time the contract was made and that make performance impossible or impractical.&nbsp;<\/p>\n\n\n\n<p>English law does not have a general doctrine of force majeure \u2014 unlike many civil law systems. A force majeure clause only&nbsp;operates&nbsp;if it is expressly included in the contract. The scope of the clause, and the events that trigger it, depends entirely on the drafting.&nbsp;<\/p>\n\n\n\n<p>Common events listed as force majeure&nbsp;include:&nbsp;natural disasters, war and civil disturbance, acts of terrorism, pandemic, government action or regulatory change, and infrastructure failure. Whether a specific event triggers a force majeure clause depends on whether it falls within the scope of the listed events, whether it was foreseeable at the date of the contract, and whether it&nbsp;actually caused&nbsp;(rather than merely contributed to) the failure to perform.&nbsp;<\/p>\n\n\n\n<p>The COVID-19 pandemic tested force majeure clauses extensively. Courts were&nbsp;generally reluctant&nbsp;to find that the pandemic triggered standard force majeure provisions, particularly where the affected party had found alternative means of performance or where the clause required physical impossibility rather than mere commercial difficulty.&nbsp;<\/p>\n\n\n\n<p>Separately from force majeure, the doctrine of frustration may apply where supervening events make performance physically impossible or&nbsp;render&nbsp;the contract fundamentally different from what was agreed. The bar for frustration is high \u2014 commercial inconvenience or increased cost is not sufficient.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Q. What\u00a0are standard terms and conditions and how do they interact with the &#8216;battle of the forms&#8217;?<\/strong>\u00a0<\/h2>\n\n\n\n<p>Most businesses contract using standard terms and conditions \u2014 pre-drafted contractual provisions that they&nbsp;seek&nbsp;to apply to all their transactions. The problem arises when both parties have standard terms and each&nbsp;purports&nbsp;to contract on their own terms rather than the other&#8217;s. This is known as the &#8216;battle of the forms&#8217;.&nbsp;<\/p>\n\n\n\n<p>Under English law, the battle of the forms is&nbsp;generally resolved&nbsp;by the &#8216;last shot&#8217; doctrine: the last set of terms that was put forward, and not objected to, before the contract was performed, will&nbsp;generally prevail. In practice, this means the party whose terms are on the last document before performance begins (often a delivery note or order confirmation) may have their terms incorporated.&nbsp;<\/p>\n\n\n\n<p>However, the outcome of a battle of the forms analysis is uncertain \u2014 it depends on the precise sequence of correspondence and the specific provisions in each party&#8217;s terms. Businesses that are serious about their standard terms should:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Ensure their terms are clearly incorporated by reference in all relevant documents \u2014 quotations, order confirmations, invoices.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Include a provision that their terms prevail over the counterparty&#8217;s terms in any conflict.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Train their sales and procurement teams to\u00a0identify\u00a0when the counterparty is\u00a0seeking\u00a0to impose their own terms and to respond appropriately.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>For high-value contracts, negotiate a bespoke agreement rather than relying on standard terms.\u00a0<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Q. What\u00a0should I do if the other party to a contract is in breach?<\/strong>\u00a0<\/h2>\n\n\n\n<p>If you believe the other party is in breach of a commercial contract, the steps to take will depend on the nature and severity of the breach and what you want to achieve.&nbsp;<\/p>\n\n\n\n<p>First, consider whether the breach is a condition (a fundamental term going to the root of the contract, which if breached entitles you to treat the contract as terminated) or a warranty (a less fundamental term that gives rise to a damages claim but does not justify termination). Wrongly treating a breach as a condition \u2014 and purporting to&nbsp;terminate&nbsp;the contract \u2014 can itself amount to a repudiatory breach, exposing you to a claim by the other party.&nbsp;<\/p>\n\n\n\n<p>Practical steps to take:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Document the breach \u2014 preserve evidence of what was promised and what has (or has not) been delivered.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Check the contract for dispute resolution provisions \u2014 many contracts require the parties to\u00a0attempt\u00a0to resolve disputes by escalation or mediation before formal proceedings.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Check notice requirements \u2014 if you intend to\u00a0terminate\u00a0the contract, many contracts require formal notice in writing and a cure period before termination is effective.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Take legal advice promptly \u2014 limitation periods begin to run from the date of breach. For a breach of contract under English law, the limitation period is\u00a0generally six\u00a0years.\u00a0<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Consider whether to continue or stop performance \u2014 continuing to perform while accepting a breach can, in some circumstances, amount to affirmation of the contract, waiving your right to\u00a0terminate.\u00a0<\/li>\n<\/ul>","protected":false},"author":12,"featured_media":8956,"parent":0,"menu_order":0,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[65],"tags":[87],"class_list":["post-8955","insight","type-insight","status-publish","format-standard","has-post-thumbnail","hentry","category-corporate","tag-richmond-office"],"acf":[],"aioseo_notices":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Q&amp;A: Business Contracts\u00a0 - RFB Legal<\/title>\n<meta name=\"description\" content=\"Q. 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