Email contracts

In Immingham Storage Company Ltd v Clear plc

Clear enquired about the use of storage space at Immingham's terminal. Immingham sent Clear, by email, a quote for a 12 month storage period, with its general conditions attached. The quote provided for a formal contract to follow in due course. Clear confirmed that it wished to proceed and faxed back a signed copy of the quote. Upon receipt, Immingham sent a "contract confirmation" email, stating that it accepted Clear's offer and that a full contract would be sent to Clear for signature. Immingham sent through a contract, but Clear never returned a signed copy. In the event, Clear did not deliver any fuel for storage; Immingham nevertheless claimed its fee.

Judgement was given for Immingham. The Court of Appeal held that, although the documents in question contemplated the signing of a "full" or "formal" contract between the parties, it was not sufficiently clear that the signing of the contract was a condition of the bargain, rather than an expression of how the parties desired to document the agreed transaction.

The Court of Appeal has clearly underlined the fact that a party wishing to agree key terms up front, whilst retaining the ability to conclude a contract containing the full terms and conditions at a later date, must expressly reserve the right to do so by using the phrase "subject to contract" or words to that effect.

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