(Czech Supreme Court Ruling No. 23 Cdo 1098/2012 dated 27 February 2013)

A situation that has become routine is when part of the content of a contract is designated as “other” commercial terms (i.e. terms not established by professional or interest organisations) known to the parties or attached to a proposal to execute the respective contract in compliance with the provision of § 273 of the Commercial Code. However, in the course of a contractual relationship the need often arises to respond to an ever-changing market environment by altering commercial terms.

In its ruling, the Supreme Court opined on the manner of changing commercial terms where the parties have neither explicitly addressed this question in a contract nor resolved the question in separate commercial terms. In this case, the parties only agreed that the contract could be amended or supplemented exclusively in the form of written addenda.

The court disagreed with the appellant’s opinion that the terms, and indeed the contract, were amended when the defendant signed an addendum to the commercial terms. In the absence of an explicit treatment of changes to commercial terms (in both the Commercial and Civil Codes), it is necessary in the opinion of the Supreme Court to infer that such changes are subject to the same set of rules as are changes to the contract itself.

Therefore, a change cannot be made unilaterally to commercial terms that are part of a contract by the mere delivery of an addendum to the commercial terms.

Nothing changes the foregoing, even a caution that if the second party does not express disapproval within a certain time limit, the change is deemed approved.

It is therefore advisable that a mechanism for changing commercial terms be established directly in the contract or in the commercial terms themselves, which form a part thereof.

We would like in this context to note the provision of § 1752 of the new Civil Code, which in the case of a change in commercial terms confers on the second party the right to withdraw from a long-term contract binding it to recurring performance (this provision applies not only to longterm contracts for the supply of goods or provision of services, but also, inter alia, to mortgages).