Well, yes you can, as Superdrug found to their considerable cost in a recent case (Athena Brands Limited -v- Superdrug Stores PLC 2019 EWHC 3503)
What was the case about?
There were negotiations between a brand manager at Athena and a buyer at Superdrug about a new product line. These resulted in the relevant exchange of emails.
The Athena brand manager sent an email including: “…Just to confirm, you are placing orders and committing to the yearly quantity against all lines detailed below……We have agreed that you will call off stock….. on an ad hoc basis within a 12-month period. If you could drop me a note to confirm all of the above ASAP that would be great. I shall then be in a position to push the button at this end.” The email included a table of nine products with quantities and prices.
The Superdrug buyer sent an email in response, linked to the Athena email: “Please go ahead with the below…..”
When Superdrug refused to honour the terms, Athena brought a claim alleging that the exchange of emails amounted to an agreement. Their case was that there was a commitment from Superdrug to purchase agreed minimum quantities of stated products at specific prices. The claim was significant – £980,000 for the shortfall in anticipated orders, as well as storage charges, interest and costs.
Superdrug sought to defend the claim on a variety of grounds – the emails were not sufficiently precise to create a contract, there was no intention to create legal relations and the buyer did not have authority to commit to the minimum order quantities.
What did the Court say?
All of these grounds failed. The court entered judgment for Athena.
This raises the question whether Superdrug could have done anything to avoid this conclusion?
What should you do to avoid a similar problem?
Assuming Superdrug’s standard terms applied, they could have included express terms limiting the purchasing authority of different grades of buyer. They could have required all emails sent during negotiations to be marked “subject to contract”. Finally, they could have trained their buyers about how easy it is to make a contract, by email (or word of mouth).