Butler Machine Tool Co Ltd v Ex-Cell-O Corp (England) Ltd [1977] EWCA Civ 9 is the leading English case on the battle of forms. Below is a short and clear summary of the case along with its key details.
Citation: Butler Machine Tool Co Ltd v Ex-Cell-O Corp (England) Ltd [1977] EWCA Civ 9 (reported [1979] 1 WLR 401)
- Court: Court of Appeal (Civil Division)
- Judges: Lord Denning MR, Lawton LJ, Bridge LJ
- Date of Judgment: 25th April 1977
- Area: Contract Law — Battle of Forms, Offer & Acceptance
Facts: Butler Machine Tool Co Ltd v Ex-Cell-O Corp (England) Ltd
On 23 May 1969, Butler (seller) sent a quotation for a machine worth £75,535. On the back were standard terms including a price variation clause (price could increase if costs went up). It also said: the seller’s terms “shall prevail over any terms and conditions in the buyer’s order.”
On 27 May 1969, Ex-Cell-O (buyer) sent back an order for the same machine but on its own terms which did not contain a price variation clause and included different delivery terms, carriage and cancellation rights etc. It also included a tear-off slip (acknowledgment) which the seller had to sign: “We accept your order on the terms and conditions stated thereon.”
On 5 June 1969, Butler signed and returned the tear-off slip.
Later, delivery was delayed. Butler invoked the price increase clause and demanded an extra £2,892.
Ex-Cell-O refused to pay, saying the contract was on their terms, not Butler’s.
High Court judge ruled for Butler. Ex-Cell-O appealed.
Legal Issue
Whose standard terms governed the contract?
Butler’s terms (including price variation clause)
OR
Ex-Cell-O’s terms (fixed price, no price variation)
Decision & Reasoning
Appeal allowed. Contract was on the buyer’s terms. No price variation clause applied.
The Court of Appeal (especially Lawton LJ and Bridge LJ) applied classical contract principles:
- Butler’s quotation = offer
- Ex-Cell-O’s order = counter-offer (it materially altered the key terms). A counter-offer kills the original offer (Hyde v Wrench).
- Butler signing the tear-off slip = acceptance of the buyer’s counteroffer.
Thus, the contract was concluded on Ex-Cell-O’s terms.
Denning MR discussed a more flexible approach. Instead of rigid offer/counteroffer analysis, courts should look at all documents and conduct to identify consensus. Sometimes the “last shot” wins; sometimes the “first shot.” But in this case, he agreed the buyer’s form prevailed because Butler accepted the exact wording on the tear-off slip: “We accept your order on the terms and conditions stated thereon.”
As usual, Denning tried to modernise the law, but the other two judges stuck strictly to classical doctrine. Denning still arrived at the same result.
Outcome:
Contract was on Ex-Cell-O’s terms.
No price rise clause.
Butler not entitled to extra £2,892.
Rule/Legal Principle [Butler Machine Tool Co Ltd v Ex-Cell-O Corp (England) Ltd]
In a battle of forms, where each party insists on its own standard terms:
A purported acceptance that introduces materially different terms is a counter-offer (Hyde v Wrench).
When the other party signs or otherwise unequivocally accepts that counter-offer, the counter-offer’s terms govern.
The “last shot” generally wins when it is accepted without objection.
Takeaway:
When companies exchange conflicting standard forms, the contract usually contains the terms of the last definite acceptance — here, the buyer’s signed acknowledgement — so Butler’s price-variation clause did not apply.
References:
https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWCA/Civ/1977/9.html
YOU MIGHT ALSO LIKE:
MORE FROM CONTRACT LAW:
- What Did Wakeling v Ripley [1951] Decide on Legal Intent?
- Lens v Devonshire Club (1914): A Quick Legal Summary
- Roufos v Brewster (1971) 2 SASR 218: A Legal Case Summary
Ruchi is a legal research writer with an academic background in CA, MBA (Finance), and M.Com. She specializes in digesting and summarizing complex judicial decisions into clear and structured case notes for students and legal professionals.