Robert,

1. I certainly accept your point 1 and I think that most people would.

2. However I am not sure that it must necessarily follow that because
as a matter of law parties cannot foreclose by contract the
possibility that they will reach a later agreement varying their
current contract the law must also preclude parties from agreeing that
if they are to vary their contract, they will do so in a particular
way. Following Globe Motors that is the law in England and Wales, I am
not sure that the law need take that absolutist position.

3. Regarding point 3, I think with respect that More-bick LJ may
under-estimate at paragraph 120 the commercial uncertainty and cost to
which allegations that an agreement has been varied which ultimately
prove ill founded give rise. (I note that I spelled More-Bick LJ's
name incorrectly in my previous email, for which apologies.) At
paragraph 120, More-Bick LJ says, in relevant part:

"Nor do I think this [the ability to vary orally despite a clause
purporting to prevent oral vvariation] need be a
matter of concern, given that nothing can be done without the
agreement of both parties; and if the parties are in agreement, there
is no reason why that agreement should not be effective."

With respect, I think this under-estimates the delay, expense and
uncertainty to which allegations that an agreement has been varied
orally which can only be determined following a full trial (if I am
right regarding summary judgment) give rise. Furthermore, More-Bick
LJ's suggestion that if the parties are in agreement, there is no
reason why that agreement should not be effective is circular. There
is no reason why the agreement to vary should not be effective only
because as the Court concludes the no oral variation clause is
ineffective. That is the result, not a reason justifying that result.

Kind regards

Ger

On 4/20/16, Robert Stevens <robert.stevens@law.ox.ac.uk> wrote:
> 1. Can the parties agree that they cannot vary their agreement? No.
>
>
>
> 2. Given 1, can the parties agree to barriers to variation, such as
> requirements of form? No.
>
>
>
> 3. That said, we should construe the meaning of what the parties
> subsequently do, and whether they do manifest am agreement to vary, in the
> light of this clause. If however they expressly do so, that is that.
> Moore-Bick LJ's points are obviously right.
>
> ------ Original message------
>
> From: Gerard Sadlier
>
> Date: Wed, 20 Apr 2016 5:02 PM
>
> To: obligations@uwo.ca;
>
> Subject:Enforceability of Contractual Clause Specifying way in Which
> Variations of Contract may be made
>
>
>
> Dear all,
>
> In Globe Motors, Inc & Ors v TRW Lucas Varity Electric Steering Ltd &
> Anor [2016] EWCA Civ 396, the Court of Appeal of England and Wales
> gave extended (though as the Court itself acknowledged, non-binding)
> consideration to the question whether a clause in a contract which
> provided that any amendment or variation of that contract had to be in
> writing and in a specific form was effective so as to prevent an oral
> variation of the contract. The Court held that the Clause was not
> effective to prevent oral variation of a contract and that parties
> could not by contract agree that their contract could only be varied
> in writing or that variations of their contract could only be made in
> a particular form.
>
> The main judgment was given by Beatson LJ, who considered this issue
> from paragraph 97 to 115 of his judgment.
>
> Both Underhill and Morbick LJJ give brief concurring judgments,
> addressing this question.
>
> http://www.bailii.org/ew/cases/EWCA/Civ/2016/396.html
>
> I have to say that I think it is very reasonable for commercial
> parties, when entering into contracts involving very significant sums
> of money and/or obligations to provide that the ways in which their
> contract may be varied are to be limited, to means specified in the
> contract itself. It is perhaps regrettable that the law does not
> entitle commercial parties to agree to this because such clauses would
> promote commercial certainty.
>
> I do recognize the force of the counter arguments and should perhaps
> also acknowledge that the Court was clearly alive to this point.
>
> Relevantly, Underhill LJ said this at paragraph 116:
>
> "... It seems to me entirely legitimate that the parties to a formal
> written agreement should wish to insist that any subsequent variation
> should be agreed in writing (and perhaps also, as here, in some
> specific form), as a protection against the raising of subsequent
> ill-founded allegations that its terms have been varied by oral
> agreement or by conduct: even though ill-founded, such allegations
> may make the obligations under the contract more difficult to enforce,
> most obviously by making it more difficult to obtain summary judgment.
> But the arguments in favour of a flexible approach are also strong;
> and in the end, even if it were desirable to treat provisions of this
> kind as entrenched, I cannot see a doctrinally satisfactory way of
> achieving that result. I have considered whether there might be some
> kind of half-way house, which made it formally more difficult for a
> party to establish a "non-conforming" variation; but none was
> suggested in argument and I cannot see any that would be of realistic
> value."
>
> Similarly, Morbick LJ said this:
>
> "120. I can see the force of the suggestion that there might well be
> practical benefits in being able to restrict the manner or form in
> which an agreement can be varied, but like Underhill LJ I do not think
> that there is a principled basis on which that can be achieved. A
> clause such as Article 6.3 in this case may have considerable
> practical utility, if only because it is likely to raise in an acute
> form the question whether parties who are said to have varied the
> contract otherwise than in the prescribed manner really intended to do
> so. As a matter of principle, however, I do not think that they can
> effectively tie their hands so as to remove from themselves the power
> to vary the contract informally, if only because they can agree to
> dispense with the restriction itself. Nor do I think this need be a
> matter of concern, given that nothing can be done without the
> agreement of both parties; and if the parties are in agreement, there
> is no reason why that agreement should not be effective."
>
> The question that arises is whether a clause limiting the way in
> which a contract may be amended or varied is of any use at all, in
> light of this judgment?
>
> At paragraph 117, Underhill LJ suggested that:
>
> "It does not follow that clauses like the second sentence of Article
> 6.3 have no value at all. In many cases parties intending to rely on
> informal communications and/or a course of conduct to modify their
> obligations under a formally agreed contract will encounter
> difficulties in showing that both parties intended that what was said
> or done should alter their legal relations; and there may also be
> problems about authority. Those difficulties may be significantly
> greater if they have agreed to a provision requiring formal
> variation."
>
> Particularly where a contract is in being over a long period (as many
> commercial contracts are) the fact that parties expressed a particular
> intention at the outset (perhaps many years ago) may not be a
> particularly cogent response to a claim that an oral variation was
> agreed - or a clear guide to the intention of the parties at the time
> when the communications said to amount to a variation of the contract
> passed between the parties. Similar points could be made regarding
> authority, since even if the contract provides that X is the only one
> with authority to agree a variation on behalf of one party, it will
> always be open to the other party to plead and try to prove that
> conduct subsequent to the execution of the written contract clothed
> others with authority to vary the contract (whether actual or
> ostensible).
>
> These issues will, to my mind, almost always need to be explored at
> trial where there are communications that could reasonably amount to
> an agreement to vary a contract, so a 'no oral variation clause' will
> rarely if ever be an answer to claims of oral variation which are
> stateable which a Court could accept on an application for summary
> judgment.
>
> I raised a query on this issue on the list some time ago now and
> would like to again express my appreciation to those who replied on
> that occasion.
>
> Kind regards
>
> Ger
>