Inevitably, businesses will have different priorities from one another in terms of income generation and business development. These range from product and brand development to increasing market share and/or revenue or growing client lists. Whilst the precise way in which any given business would give priority to the above will vary, most would agree that all are important to the business’s success.
Conversely, something that is often overlooked, or pushed to the bottom of the pile, is ensuring that the business has a fully tailored set of terms and conditions for use with clients.
Are your terms and conditions suitable?
Many businesses have some form of terms and conditions in place, although surprisingly for some, in many cases these have merely been copied from somewhere on the internet. Very often, they are not suitable for how they conduct their business, or for the market in which they operate. Relevant terms and conditions are important for a wide variety of reasons, some of which are legal and some of which are practical and commercial.
An effective set of terms and conditions can be utilised as a marketing tool to sell goods or services in a professional manner and provide a solid foundation from which the business can grow and flourish.
What should terms and conditions include?
A good set of terms and conditions will provide clear provisions in an understandable way as to:
- the goods or services to be provided;
- delivery terms; when and how payment is to be made;
- the allocation of risk; and
- the liability that each party is willing to accept.
By documenting these points, the scope for misunderstanding is reduced between the parties to the transaction.
Potential pitfalls
The relatively recent case of Trebor Bassett v ADT Fire illustrates how even well established businesses can encounter problems with their terms and conditions. In this case, ADT was found liable for £110 million in damages because of a poorly drafted limitation clause.
Businesses are often somewhat unenthusiastic about implementing a bespoke set of terms and conditions, typically due to a concern that their customers, and they themselves, will be confronted by legal jargon which may not reflect their brand or feel particularly engaging. However, terms and conditions need not be drafted in a complicated way. Simple and effective drafting will benefit all parties in understanding and delivering on the commercial relationship.
Unfortunately, many businesses will only review their terms and conditions when something has gone wrong, at which point it may be too late.
If you would like to discuss the use of a bespoke set of terms and conditions for your business, please contact Simon Porter in BakerLaw’s Company and Commercial Department at simon.porter@baker-law.co.uk or call 01252 730754 to discuss further.
Case Referenced:
Trebor Bassett v ADT Fire Security [2012] EWCA Civ 1158
This article is not a substitute for legal advice on specific facts and circumstances. It is designed as a free update on the law at the time of publishing. BakerLaw LLP and/or the writer accepts no responsibility for reliance on this article and recommends that you seek independent legal advice on your specific circumstances prior to taking any steps.
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