Contractual changes can be agreed despite not meeting contract formalities, says Chris Nillesen
The recent cases of Globe Motors Inc and others v TRW Lucas Varity Electric Steering Ltd [2014] EHWC 3718 (Comm) and Virulite LLC v Virulite Distribution Ltd [2014] EHWC 366 (QB), [2014] All ER (D) 37 (Mar) serve as timely reminders of the importance of understanding how changes to contracts can be agreed and what contracting parties should be aware of.
Forever friends
Long term contractual relationships, whether for the acquisition of goods or services are invariably subject to change. Prices, laws, contracting parties, technology, standards and practices all change over time. Contracts depending on their length, value and scope can address such changes through a variety of measures. However it is advisable for the parties to consider at the outset how changes will be managed and in particular who should bear the cost of change. Simply ignoring the likelihood and the implication of change could instigate a contractual dispute.
The Globe case was a complex dispute regarding the design of electric power steering systems. Part of the dispute centred on
