Gordon Russell (UK) Ltd v Warwick

LORD JUSTICE MOSES: This is yet another round in a most unfortunate dispute between Mr Warwick, who was buying bespoke furniture from Gordon Russell UK Ltd. The judge made certain findings as to the formation of the contract and it is those findings which are challenged in this appeal, given with the leave of Laws LJ, by Mr Warwick.

The case was primarily concerned with a number of defects which Mr Warwick contended were present in the furniture delivered and installed at his house, Honiley Hall, by Gordon Russell. But the dispute which is of relevance in the instant appeal concerns a term of the contract as to payment. Gordon Russell contends that the term of the contract for payment is that which is contained in its conditions of sale, 8.2:

Mr Warwick, the appellant in this appeal, on the other hand contends that in terms the standard conditions were varied and that the term which applied in the instant case was that which is shown at the bottom of a quotation, namely: “balance due on completion-/sign off by client”.

There also arises in the appeal as dispute as to what those words mean, but that dispute is of no relevance if it was not a term of the contract. The judge made various findings as to the formation of the contract and concluded that the terms of the contract were those contained in the standard conditions of sale and thus the term in relation to payment was that payment should be at the end of the calendar month following the calendar month of the company’s invoice.

He reached that conclusion for the reasons he set out in paragraphs 2.2 and following. A number of quotations had been sent by Gordon Russell, three in all. One was dated 10 September and two were dated 23 September 2002. The quotation dated 23 September 2002 was the quotation -- which, to use as neutral a word as I may, the client, Mr Warwick, accepted. He signified his acceptance by signing that quotation. That quotation included the terms that the balance was due “on completion/sign-off by client”, although the earlier two quotations contained no such words and had been accompanied by the standard conditions of sale which I have already identified in relation to the terms of payment. That quotation was followed by what was referred to as an acknowledgment of 25 October 2002 which referred to payment terms in the terms already indicated in the standard conditions, namely by the 31^st of the next month.

It is, therefore, not surprising that the judge concluded as follows: that the quotation sent by Gordon Russell was an invitation to treat; that the signature which Mr Warwick placed on that quotation transmogrified the quotation from an invitation to treat into an offer; and that that offer was accepted by the acknowledgment dated 25 October 2002. In those circumstances it was a term of the contract that payment should be on 31^st of the next month following the delivery of the invoice. He was further supported in that conclusion by the terms of the standard conditions of sale, which he had found to be incorporated into the contract. Clause 2 provides:

There was thus ample material upon which the judge was entitled to conclude that there was no contract until the acknowledgment of order was sent, and that it was a term of the contract that payment would be on 31 of the month following the delivery and thus the contract price was due and payment on 31 December 2002 (see paragraph 2.11(e)).

Mr Jones, who did not appear below, and also has the task of deconstructing those clear conclusions, has referred firstly to the fact, as is plain, that at some stage the standard terms were at least augmented and someone contemplated their variation. The quotation itself, which was accepted by Mr Warwick, referred to a deposit received of £10,000 and there are other documents showing that before the acknowledgment of order that that deposit was sent. There is no provision for the payment of deposit in the standard conditions of sale, although there is nothing to prohibit them. Further, someone had clearly thought it right to add to the quotation “balance due on completion/sign-off by client”.

He also drew attention to passages within the transcript, particularly at page 119, where the judge took over the cross-examination and asked questions of Mr Summerley, who was the senior official of Gordon Russell, I think he is one of the managing directors or a director, about the terms of the contract, and it is plain from those answers that Mr Summerley took the view that it was a term of the contract that payment would be on completion/sign-off. Indeed, Mr Summerley was at pains, with perhaps little success, explaining precisely what that phrase meant.

Finally, Mr Jones drew attention to the pleadings, which clearly seemed to accept that it was a term of the contract that payment should be on completion/sign-off, although that stance was varied by the time Miss Rowlands came to make submissions to the judge. The pleadings, as it seems to me, were an important feature of Gordon Russell’s case. It was for the claimant, Gordon Russell, to make its case as to the terms of the contract, not for the claimant to put forward a number of variations, throw them up in the air and to hope that the judge will catch the appropriate answer as those variations float towards the ground.

However, the question of fact as it emerged before the judge was one as to whether the quotation was an offer accepted by Mr Warwick or whether it was an invitation to treat. That was a question of fact for the judge and, provided he did not err in law or did not misconstrue some part of the evidence, it was a conclusion of fact with which, in my view, this court ought not to interfere. In my view the judge was, as it seems to me on all the evidence, wholly entitled to reach that conclusion and indeed was correct.

In those circumstances the somewhat more perplexing question of precisely what “completion/sign off” means and whether they are an oxymoron or tautology or neither, does not fall for consideration today. I would only urge Gordon Russell in future, if it were prepared to listen to my advice, not to allow such ambiguities to appear on its contracts because it will only lay up a whole store of trouble for itself in the future.

For the reasons I have given, in my view this appeal should be dismissed. Mr Warwick has failed to persuade me that there was any other term for payment than that which the judge found.