British Crane Hire Corporation Ltd v Ipswich Plant Hire Ltd [1973]
Court: Court of Appeal
Facts: British Crane Hire Corporation Ltd (Claimant) and Ipswich Plant Hire Ltd (Defendant) had a history of using printed forms in their transactions. In June 1970, Ipswich Plant needed a crane urgently, and an agreement was made over the phone for the hire and transport charges. British Crane delivered the crane and provided a form specifying that the hirers would be responsible for recovery costs if the crane was stuck. Ipswich Plant did not sign the form. The crane got stuck in marshland, incurring high recovery costs. British Crane sought to enforce the recovery cost clause included in the unsigned form.
Issue: Were the terms in the unsigned form, specifically the recovery cost clause, incorporated into the oral contract based on trade practice?
Held: Ipswich Plant was liable to indemnify British Crane for the recovery costs. The Court of Appeal found that the indemnity terms were incorporated into the contract through accepted trade practice, not solely through a course of dealing.
Key Judicial Statements - Lord Denning MR: Highlighted the key issue with a dramatic opening: "In June 1970, a big earth-moving machine got stuck in the mud. It sank so far as to be out of sight. It cost much money to get it out. Who is to pay the cost?" He ruled that the indemnity clause was part of the contract due to the parties' common understanding of industry practices, even though the form was not signed. He emphasized that while a limited course of dealing alone might not imply terms, the established trade practices and the parties' awareness of such conditions justified incorporating the terms.
💡 Leveluplaw: This case demonstrates that in commercial transactions, terms reflecting accepted trade practices can be deemed incorporated into a contract even without explicit agreement or signature. The ruling emphasizes the significance of industry norms and the mutual understanding of such practices between parties, illustrating that established trade customs can shape contractual obligations.