Battle of forms can be defined generally as two persons intending to contract but tender different form contracts, making it difficult to ascertain the terms of contract or determine as to whether there exist a contract. When each party seeks to impose its terms upon the other and seeks to avoid being bound by the other’s terms, the court's task is to decide what each party to an alleged contract would reasonably conclude from the utterances, writings or conduct of the other.
In the context of construction law, battle of forms exists when a there exist conflict in the terms of a contract or supply agreement between contractor and subcontractor. When a subcontractor edits and signs a form and the contractor refuse to sign the revised form battle of forms arises. According to New York law, a defective acceptance can only amount to a counteroffer, and the only way a contract can be formed is by acceptance of the counteroffer in the same way as if it were an original offer. Bridge v. O'Callahan, 118 N.Y.S.2d 837, 838 (N.Y. City Ct. 1953).
In Northrop Corp. v. Litronic Indus., 29 F.3d 1173 (7th Cir. Ill. 1994), it was observed by Posner, Chief Judge, "Battle of the forms" refers to the not uncommon situation in which one business firm makes an offer in the form of a preprinted form contract and the offeree responds with its own form contract. At common law, any discrepancy between the forms would prevent the offeree's response from operating as an acceptance. So there would be no contract in such a case. This was the "mirror image" rule, which Article 2 of the Uniform Commercial Code jettisoned by providing that "a definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is made conditional on assent to the additional or different terms."
Where both parties’ forms insist on their own terms, and no other terms, they have invoked the “mirror image rule.” Then, no contract is formed because neither form exactly matches the other. If the parties’ conduct however impliedly recognizes the existence of a contract, then the terms of the contract include those terms on which the forms do agree, plus the “gap fillers” provided by the UCC.
There is another rule called the last shot doctrine adopted while construing the terms of a contract in a battle of forms. It was observed in Butler Machine Tool Co. v. Ex-Cell-O Corp. 1 WLR 401 (1979) that, "... where there is a battle of the forms, there is a contract as soon as the last of the forms is sent and received without taking objection to it. In some cases, the battle is won by the person who fires the last shot. He is the person who puts forward the latest term and conditions; and, if they are not objected to by the other party, he may be taken to have agreed with them."
In supply contracts of significant value, in order to avoid battle of forms, buyers and sellers are well advised to compare forms to understand what they are, or are not, getting. It is more preferable to negotiate a contract by the parties on a supply contract of consequence rather than simply relying on forms that may not get the job done and end up in battle of forms.
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