includes a statement that credit is only offered subject to the customer’s acceptance of the BIFA STC applying to all business by you for it. If you refer in a credit application to the application of STC, they may be taken to apply only to the credit agreement and not all business conducted between the two parties. The credit application form should be signed by a suitably


authorised staff member within the customer’s organisation. Further information regarding checking and verifying the information is included in the ‘Guide to Due Diligence Regarding Credit Application Procedures’ published on the BIFA website. It is important to note that the Unfair Contract Terms Act 1977


(UCTA) has a test of reasonableness that includes a number of guiding points, including whether or not the parties have equal bargaining power, which is decided by reference to a number of indicators such as whether each party was free to contract elsewhere or to negotiate the terms, and is not necessarily based only on difference in size of the parties. This reasonableness test applies to standard terms such as the BIFA STC and, generally speaking, UCTA attacks by customers against certain provisions of the BIFA STC have not been successful in the courts. However, do be sure that, when dealing with a private


individual acting as a consumer, you make greater efforts to explain the BIFA STC in detail and ensure customers understand and agree to them, as the Unfair Terms in Consumer Contracts Regulations 1999 prevent reliance on certain terms if they are not individually negotiated beforehand. The regulations do not apply to individuals not acting as


consumers. One area that we urge Members to be careful about is what lawyers commonly refer to as the “battle of the forms”, where


January 2019


the customer submits either its own or modified BIFA terms stating that these will be contract terms, thus superseding the original BIFA STC supplied. There are two distinct but related issues to be considered. Firstly, are Members willing to accept the proposed amendments? And secondly, these must not undermine the fundamental basis of the STC and be appropriate for the business undertaken.


Requests for changes The most common requested changes relate to the limits of liability and lien clauses. After discussion with insurers, a Member may decide it to be appropriate to offer a higher limit of liability. Regarding the lien clause, it is probably not sensible to remove it from contracts dealing with general, and thus often saleable, merchandise. However, some of our Members handle very specialist items that would be either difficult or illegal to sell in the UK. Therefore in these circumstances it would be more appropriate to consider the lien clause. The crucial thing in a battle of the forms is to ensure that there is clear evidence that the counter offer is rejected in writing and a full audit trail maintained of all correspondence. There is a longer guide on the BIFA website concerning the


correct usage of the BIFA STC, and guidance regarding checking credit applications and managing risk. In many ways the STC are a cornerstone of the trading relationship between Members and their customers. By ensuring their correct incorporation at an early stage, the Member can rely on their protection and the customer knows the obligations placed upon their freight forwarder relative to all business undertaken on their behalf.


Do be sure that, when dealing with a private individual acting as a consumer, you make greater efforts to explain the BIFA STC in detail and ensure customers understand and agree to them


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