Case No: A3/2015/1099
Neutral Citation Number: [2016] EWCA Civ 443
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE QUEEN’S BENCH DIVISION, COMMERCIAL COURT
HIS HONOUR JUDGE MACKIE QC
[2015] EWHC 726 (Comm)
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 06/05/2016
Before:

LORD JUSTICE ELIAS
LORD JUSTICE UNDERHILL
and
MR. JUSTICE CRANSTON

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Between:

	Reveille Independent LLC	Respondent	
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	Anotech International (UK) Limited	Appellant 	

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Mr Matthew Cook (instructed by Goodman Derrick LLP) for the Appellant
Mr Turlough Stone (instructed by Bryan Cave) for the Respondent

Hearing date: 13/04/2016
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Judgment
Mr Justice Cranston: 
Introduction
1.	In what circumstances will a contract result when a written offer document states that it is not binding until signed by the offeree and the offeree does not sign but performs in the manner contemplated by its terms?  The question arises in this appeal in the context of a dispute between the appellant, Anotech International (UK) Limited (“Anotech”), part of a corporate group manufacturing and marketing home cookware utensils under the name “The Cookware Company”, and the respondent, Reveille Independent LLC (“Reveille”), a United States corporation producing television programmes, including the cooking programme, MasterChef US.  At the time the dispute arose Reveille was owned by the Shine Group (“Shine”).  Shine was closely linked through the Murdoch family to the Fox Network, which broadcast MasterChef in the United States and Canada.  The main presenter of the MasterChef programmes was the celebrity chef, Gordon Ramsay.
2.	The dispute concerns whether a binding contract came into existence between the parties in 2011 by which Reveille agreed to integrate and promote The Cookware Company’s products in three episodes of Season 2 of MasterChef US, as well as license Anotech the right to use the MasterChef brand on its products for sale in the United States and Canada. Long form agreements negotiated between the parties were never completed. However, following a five day hearing in the Commercial Court, HHJ Mackie QC (“the judge”) held in March 2015 that there had been a binding contract between the parties, formed by Reveille accepting through conduct a relatively short written agreement (“the Deal Memo”) which had been signed by Anotech but not Reveille.
3.	In this appeal, Anotech contends that the judge was wrong to conclude that there was a contract reached in circumstances in which the Deal Memo expressly stated that it would not be binding on Reveille until Reveille signed.  Given that the standard wording was designed to ensure certainty and that Reveille would not be bound informally, Anotech contends that the judge should not have concluded that there were clear and unequivocal acts on Reveille’s part leading to a binding contract.
4.	There were other issues before the judge which do not arise on appeal but are worth mentioning.  One was whether there was a condition precedent to the contract coming into existence concerning a brand conflict with Gordon Ramsay, in that he was marketing his own brand of cookware in the United States.  The judge held that there was no brand conflict and that both sides realised they could not prevent Gordon Ramsay from selling his own products so long as he did not infringe Reveille’s intellectual property rights in the MasterChef brand.  Another issue was whether Reveille was entitled to payment for what it did in a claim in unjust enrichment if, as Anotech had contended, there was no contract.  Although the judge discussed the issue he did not find it necessary to reach a final conclusion. Nor, as will become evident, do I.  
5.	On the issues which do arise for decision in this appeal there is no need to recount in detail the evidence the judge discussed.  The judge’s findings of fact, about which there is no dispute, means that that would be redundant.  Consequently, the only person I have found it convenient to identify by name in this judgment is that of the managing director and sole director of Anotech, Mr Stevens.  He was the principal point of contact for Reveille at Anotech and the negotiator of the Deal Memo and the long form agreements.  By the time of the trial he had left the company.  He did not give evidence to the judge.
Facts
6.	The parties began negotiations in early January 2011 regarding the terms under which Reveille would license Anotech to use its intellectual property rights in the brand MasterChef in marketing its products in North America, and would integrate Anotech’s products into three episodes of the television series, MasterChef, for broadcast there on the Fox Network (“Fox”).  On 16 February 2011 Reveille sent a Deal Memo to Mr Stevens of Anotech containing relevant terms. It was envisaged that eventually its terms would be replaced by detailed, long form agreements, which the parties were to negotiate.
7.	The Deal Memo appeared to be Reveille’s standard form.  It contained a series of boxes.  It named Anotech as the licensee company.  The licensed articles were identified as including cookware, metal bakeware, and metal kitchen utensils for cooking and serving, but excluding products designed primarily for or directed primarily at children and teenagers up to 18 years in age.  The licence territory was the United States and Canada and the licence term was five years, from 24 February 2011 to 23 February 2016.
8.	There were several boxes in the form covering payment.  Box 20 provided for payments of $1,410,000 over 5 years, with an advance of $52,500 due on signing.  The schedule of payments was contained in Box 21, including $157,500 due on 1 May 2011 and then an increasing schedule of payments from 1 March 2012 to 1 March 2015.  The royalty rate, in Box 22, was 7%, escalating to 8% in the fourth and fifth years.  Box 27 stated: “Marketing Commitment 2% advance on signature unless approved.”
9.	A Comments/Special Instructions section in the Deal Memo had a subheading “License term requirements”.  It included provision for the agreement to terminate early if the show was not recommissioned after the summer 2011 season, allowed sub-branding and set out how products were to be integrated into Season 2, including a $300,000 integration fee in addition to the advance fee for the licence.
10.	An Additional/Special Provisions box at the bottom of page 2 stated: “Non-refundable Advance is due upon signature of this Merchandising Deal Memo.”  That box continued that unless otherwise agreed by Reveille, the parties had 45 days from the date of the Deal Memo to conclude the long form agreement.  If the parties were unable to conclude and execute the long form agreement within that period, all negotiations would terminate if Reveille so notified the licensee.
11.	On page 3 of the Deal Memo the text above the signature box stated: “This Merchandising Deal Memo shall not be binding on Reveille until executed by both Licensee and Reveille”.
12.	On 23 February 2011, Reveille emailed Mr Stevens on a number of matters.  One was to explain that the Deal Memo would need to be sent to Fox for approval, but that there were “[n]o concerns on the approval” from them.  Later the same day Mr Stevens returned an amended version of the Deal Memo.  After internal discussions within Reveille, a revised version was sent to him the following day, 24 February 2011.
13.	Over two days, 24 and 25 February 2011, there were discussions between the parties about the use of the MasterChef brand for Anotech’s stand (using the name ‘The Cookware Company’) at the Chicago International Homes + Housewares Show.  Reveille told Mr Stevens that it could not approve its use unless Anotech signed the Deal Memo.  Mr Stevens also had discussions about images of MasterChef presenters that could be used.  Reveille made clear that it was not possible to use the name or likeness of Gordon Ramsay but it did approve use of the MasterChef brand at the Chicago show.
14.	A few days later, on 28 February, Mr Stevens raised his concern about Gordon Ramsay’s description on the website of QVC, the online and television shopping company.  Gordon Ramsay was promoting other cookware on the website and was described there as “The Master Chef”.  Reveille accepted that this was impermissible and Mr Stevens was copied into Reveille’s emails, sent to Gordon Ramsay’s representatives.  Meanwhile, 120 boxes of Anotech’s products were delivered to the MasterChef set for use in the television programmes.  They weighed 2340lbs.  Reveille made clear that it could not integrate these into production unless the Deal Memo was signed.
15.	Mr Stevens returned a signed version of the Deal Memo to Reveille, with amendments, on 28 February 2011.  In Box 27, Mr Stevens wrote “Approved no marketing advance”.  Mr Stevens also made a handwritten addition in the Comments/Special Instructions section which stated “Branding Conflict with Gordon Ramsay to be concluded.”  The version Mr Stevens returned, as received by Reveille, no longer included the Additional/Special Provisions box.  The judge accepted that this was because in transmission this section had been cut off by mistake.
16.	In very early March, Reveille swapped Anotech’s products into the production of the television episodes of MasterChef US, which were shortly to be recorded.  Anotech also sent Reveille the final, approved “talking points” to be incorporated into the episodes, alongside its products.  Episode 213 was filmed on 10-11 March 2011, and episodes 215 and 217 on 15 and 18 March 2011.
17.	The Chicago International Home + Housewares Show took place in the second week of March.  The Cookware Company’s stand at the show had a tower with the sign “MasterChef, as seen on the television series MasterChef”.  Mr Stevens had amended and approved a press release after the show in which the Shine Group and Reveille announced that they continued to build on the success of the MasterChef series with a new partner, The Cookware Company.  It referred to the Chicago show and the use in season 2 of MasterChef of The Cookware Company’s cookware.
18.	On 7 March 2011 Reveille received a short email from Fox approving Anotech’s role in the MasterChef programmes.  That day there were internal communications within Reveille to the effect that the branding issue had also been resolved and the description of Gordon Ramsay on the QVC website as “The Master Chef” removed.  When the following month, on 12 April 2011, Mr Stevens was asked whether he was willing to sign a new version of the Deal Memo, without his amendment regarding Gordon Ramsay, since it was understood the issue had been resolved, he responded: “Not been resolved to my knowledge.”  After this, Mr Stevens did not raise the matter again.  There was nothing about it in the long form draft agreements, and on this basis the judge concluded that the issue “had gone away”.
19.	After the Chicago show, Anotech’s sale representatives began to use the MasterChef name in their email footers, when corresponding with third party retailers.  Its sales literature and press releases referred to the fact that it had the licence for MasterChef US.  Further, Anotech was brought into contact with other MasterChef US licensees, first with an email on 11 March 2011.  The first round-table weekly conference call between Reveille and MasterChef licensees, in which Anotech participated, occurred on 21 March 2011.  In the accompanying emails, which it saw, it was referred to as a licensee.  In response to a question from Reveille on 1 July 2011 as to the property for which it already held a licence Mr Stevens replied, “MasterChef UK and US”.
20.	Work on long form integration and merchandising agreements had begun with Reveille sending drafts to Mr Stevens on 9 and 14 March 2011.  On 11 April 2011, Mr Stevens returned a revised, long form merchandising agreement, with the name of The Cookware Company Ltd substituted as the party responsible for paying promotional consideration.  By late March Anotech’s parent company had merged with another company, GreenPan Ltd, with which it had been closely associated, under the name “The Cookware Company”.  Over the following months there were further negotiations regarding the long form agreements but they were never completed, negotiations breaking down at a late stage.
21.	The television programmes recorded earlier in 2011 were to be broadcast mid-year.  On 9 May 2011 Anotech provided imagery of its products for use in editing into the shows, and in June 2011 it approved the content of the three episodes.  The programmes were broadcast late July – early August 2011 on the Fox network.
22.	Reveille sent an invoice in late August 2011 for “MasterChef Product Integration – Advance” in the sum of $300,000.  On 6 September 2011, Mr Stevens sent an email to Reveille which stated that he would arrange for the invoices for the “first payments” to be paid by return, namely the $52,500 advance, $152,500 minimum guarantee payment and $300,000 integration fee.  He requested that the invoices be addressed to The Cookware Company (HK) Limited, which was to be the party to the long form agreements.  Payment was never made.  
23.	Finally, on 24 July 2012 Reveille wrote to Anotech treating the contract as repudiated. 
The judge’s findings
24.	The judge identified the real dispute between the parties as being whether a binding agreement on the terms of the Deal Memo was entered into, given that negotiations over the long form agreements ultimately broke down.  If the parties had contracted on the basis of the Deal Memo it was a legally binding commitment.  The judge considered whether Reveille had properly signed the Deal Memo but held that it had not.  There is no challenge to that finding in the appeal.
25.	Reveille had argued that it could waive the signature provision within the Deal Memo since it was for its benefit alone.  The rules relating to prescribed modes of acceptance are based on the assumption, said the judge, that the offer was drawn by the offeror and that the stipulations as to the mode of acceptance were for its benefit.  But here the offeror was Anotech, because its Mr Stevens had amended Reveille’s draft Deal Memo, and that amended version was the offer.  Although the judge accepted the description of the rules as formalistic, he said that the substance of the matter, focusing solely upon the terms of the contract, was that Anotech would not be bound by the Deal Memo until Reveille’s acceptance of it was communicated to it.  That, he said, was not a mere formality given, in particular, that it contained Mr Stevens’s term about the brand conflict with Gordon Ramsay.  The judge continued:
“[26]…[Reveille] did not communicate acceptance by signing and returning the document designed for the purpose. There is force in the submission that one reason for having such a requirement is to remove the uncertainty which otherwise might arise and has done so in this case. As I see it those factors may make it more difficult to show that acceptance has been validly communicated by conduct but they do not affect the principle. The evidence must be clear and, when considered as a whole and in context, unequivocal.”
26.	In the absence of Reveille’s signature, the judge considered whether its acceptance of the offer had occurred other than in the prescribed manner.  He said that involved what Reveille actually did, mainly as regards carrying out the alleged contract with Anotech.  The judge addressed what had been done concerning integration and licensing.  As to the integration of Anotech’s products into the MasterChef US episodes, the judge held that the lengthy and well documented evidence made extremely clear that there was nothing in the complaints Anotech was now making that its products had not been properly integrated: these complaints were not made at the time and were unsupported by the documents.  Moreover, on Anotech’s behalf, Mr Stevens had acknowledged in September 2011, both externally and internally, that the company was liable to pay for the integration of its products.
27.	With regard to licensing, the judge recalled the evidence on matters such as Anotech’s employment of the MasterChef brand at the Chicago show, Anotech’s use of MasterChef branded products in the US for marketing purposes, Anotech’s own response to Reveille on 1 July that it held a licence for MasterChef UK and MasterChef US, Anotech’s participation in conference calls between Reveille and its other licensees, and Anotech’s representations to third parties. On this basis the judge concluded that Reveille had indeed conferred a licence on Anotech to use its intellectual property in the MasterChef brand, as the Deal Memo contemplated.
28.	While it was overwhelmingly clear that the parties had carried out the work envisaged by the Deal Memo, the judge continued, that did not of itself mean that there was acceptance by conduct but, he added, “it goes a long way”.  He then considered Anotech’s argument that the long form agreements were in different terms from the Deal Memo and therefore amounted to a counter-offer.  The judge swiftly disposed of this: the drafts of the long form agreements presupposed the existence of the Deal Memo as a binding contract and were part of the chain of negotiation intended to lead to a contract superseding it.
29.	The judge gave more lengthy treatment to Anotech’s contention that the early work undertaken was pre-contractual performance, not work pursuant to any contract in the Deal Memo.  Anotech’s case was that what was done before at least 7 March 2011, when Fox gave its approval, could not be seen as unequivocal acceptance of the Deal Memo.  The judge’s conclusion was that there was a change in nature between what was done in February and what was done in March.  By March, Reveille was performing its obligations under the Deal Memo, and Anotech knew this.  Further, Reveille had made it clear to Anotech that the release of its intellectual property rights was on the basis that the Deal Memo would be signed.
30.	Approval from Fox was necessary but, said the judge, refusal was unlikely given the Murdoch family links between Reveille and Fox.  Reveille was content to take a risk that it would not be forthcoming and thus it could accept by conduct before Fox’s consent arrived on 7 March 2011.  The judge commented: “Unsurprisingly, to anyone who had not studied the document closely, what mattered was not [Reveille’s] signature on the Deal Memo but that of [Anotech]”.
31.	The judge added that Anotech readily acknowledged later that the parties had worked together on the project and that it had to pay the sums provided for in the Deal Memo: see in particular Mr Stevens’s 6 September 2011 email.  Negotiation of the long form agreements was envisaged by the Deal Memo, he held, and was not inconsistent with acceptance of it by conduct.  The judge summed up on the point as follows: 
“[35]… As I see it the acts from early March onwards were much more significant and consistent only with the parties recognising that they were contractually bound…
[40] This is a familiar situation in which parties act commercially but in a way which sits uneasily with established principles of the law of contract. The parties did preparatory work before any contract could have come into effect because they judged that terms would in time be reached. A starting point therefore is the recognition that at least some work might be done without the parties entering into a contract. Once [Anotech] had signed and sent in the Deal Memo [on 28 February] it must have recognised that the deal was there or almost so. Work continued and intensified. [Anotech] worked and communicated with others on the basis that a deal was in place...
[41]… As I see it the [Reveille] communicated its acceptance by conduct in early March and thereafter as [Anotech] recognised when acknowledging its obligation to pay…”
32.	The judge’s overall conclusion was that Reveille had accepted by conduct Anotech’s offer contained in the amended and signed Deal Memo returned on 28 February 2011.  Accordingly he ordered Anotech to pay $1,010,000, being the unpaid integration fees of $300,000 and guaranteed minimum royalties of $710,000, plus interest and costs.
The appellant’s case
33.	For Anotech, Mr Cook contended that the judge could not properly have concluded that Reveille had clearly and unequivocally represented that it was bound by the Deal Memo and had waived the requirement to sign.  Nothing could be clearer, he submitted, than the express provision in the Deal Memo about signature, designed to avoid the risk of Reveille being bound as a result of informal steps before its internal approval processes had been completed and to remove the very uncertainty which had arisen in this case.  Because Reveille had expressly said only a signature would be good enough, its conduct was seen as potentially explicable as conduct in anticipation of a contract being subsequently entered, either the Deal Memo itself or the long form agreements.
34.	Indeed, Mr Cook submitted, even though Anotech’s products were used in the filming of the three programmes of MasterChef in March 2011, they were really only pots and pans until the imagery was later incorporated identifying them as The Cookware Company’s products.  Even if, as the judge said, a contract was nearly agreed, that does not alter the fact that steps such as these were preparatory only.
35.	In advancing this argument, Mr Cook disclaimed any suggestion that his submissions would exclude in practice any possibility of acceptance by conduct in circumstances like the present.  In this case, he submitted, the judge’s principal error was that he accepted that the communication of acceptance by Reveille was not a mere formality given the modifications made by Mr Stevens when he returned the Deal Memo, yet then contradicted this with his comment, quoted earlier in the judgment, that what mattered was not Reveille’s signature but Anotech’s.
36.	Mr Cook underlined the importance of the exchanges between the parties on 12 April 2011, which the judge had crucially ignored.  In Mr Cook’s submission Reveille’s request to sign the original Deal Memo on 12 April was a counter-offer, and so a termination of Mr Stevens’s offer of 28 February (the original Deal Memo with his amendments).  Consequently, there was no longer an offer open for acceptance after 12 April 2011.  The parties were obviously not ad idem given Mr Stevens’s response that, to his knowledge, the brand conflict had not been resolved.  Once this was the relevant cut-off date, the judge could only examine conduct prior to 12 April 2011 as constituting acceptance.  In fact the judge had examined Reveille’s conduct throughout 2011, thus taking account of facts which were legally irrelevant.
37.	With respect to approval by Fox, Mr Cook described it as a question mark hanging over matters.  Viewed objectively, approval from Fox was stated to be a necessary step before Anotech could enter into the agreement but Anotech was never told that this approval had been obtained.  Fox approval was not included in the Deal Memo as a pre-condition but, in Mr Cook’s submission, there was no need to do that in circumstances in which the Deal Memo expressly stated it would not be binding until signed by Reveille.  What happened was consistent with the process of gaining Fox’s approval still being ongoing and hence the Deal Memo not having been accepted by Reveille.
38.	In Mr Cook’s submission, the judge had ignored the significance of payment in his analysis of whether a contract was formed.  Under the terms of the Deal Memo an advance payment of $52,500 was payable upon signing the Deal Memo, and a further payment of $157,500 was due on 1 May 2011, yet Reveille failed to demand these payments at any point prior to September 2011.  That was the best evidence that neither party believed a contract had been formed in March 2011 or subsequent months.  When Mr Stevens stated in September that he would get the invoices paid by return, that was in the context of the long form agreements being ready for signature.  The fact that Mr Stevens asked for the invoices to be reissued to the intended contracting party to the long form agreement supported the interpretation that he was looking at payment being made pursuant to them.
39.	In any event, Mr Cook submitted, there was no proper basis on which the judge could have concluded that any steps taken by Reveille during the period March to 12 April 2011 were unequivocally acts representing an acceptance of the Deal Memo rather than acts being taken in anticipation of an agreement being reached.  If, as the judge put it, once Anotech had signed and sent the Deal Memo it must have recognised that the deal was almost there, it would not be illogical for it to start to perform, particularly when, as here, there were commercial and time pressures.  While Reveille performed its expected obligations, it did so in the clear knowledge that it had not signed the Deal Memo and in the expectation that there would be long form agreements.  It chose to take the risk.  If Reveille had been the one who had pulled out of the deal and it was Anotech which was arguing that there was a binding contract on the terms of the Deal Memo, submitted Mr Cook, Reveille would be asserting that it was not bound because there was an express requirement stating that it had to sign and had not done so.
Discussion
40.	There are a number of rules of English contract law which, in combination, bear on the resolution of this appeal.  First, classical analysis finds the parties’ consent to a contract in the acceptance of an offer, and it is well accepted that acceptance can be by the conduct of the offeree so long as that conduct, as a matter of objective analysis, is intended to constitute acceptance: Brogden v. Metropolitan Railway Co (1877) 2 App Cas 666.  Secondly, as in Brogden, acceptance can be of an offer on the terms set out in a draft agreement drawn up between the parties but never signed.  Thirdly, if a party has a right to sign a contract before being bound, it is open to it by clear and unequivocal words or conduct to waive the requirement and to conclude the contract without insisting on its signature: Oceanografia SA de CV v. DSND Subsea AS (The Botnica) [2006] EWHC 1360 (Comm); [2007] 1 All E.R. (Comm) 28 at [94], per Aikens J.
41.	Fourthly, if signature is the prescribed mode of acceptance an offeror will be bound by the contract if it waives that requirement and acquiesces in a different mode of acceptance.  In my view it follows that where signature as the prescribed mode of acceptance is intended for the benefit of the offeree, and the offeree accepts in some other way, that should be treated as effective unless it can be shown that the failure to sign has prejudiced the offeror: see Chitty on Contracts, 32nd ed, 2015, §§2-066, 2-067; MSM Consulting Ltd v. United Republic of Tanzania [2009] EWHC 121 (QB), at [119] per Christopher Clarke J. Fifthly, a draft agreement can have contractual force, although the parties do not comply with a requirement that to be binding it must be signed, if essentially all the terms have been agreed and their subsequent conduct indicates this, albeit a court will not reach this conclusion lightly: RTS Flexible Systems v. Molkeroi Alois Muller GmbH [2010] UKSC 14, [2010] 1 WLR 753, at [54]-[56]. Finally, the subsequent conduct of the parties is admissible to prove the existence of a contract, and its terms, although not as an aid to its interpretation: Chitty on Contracts, 32nd ed, 2015, §13-129.
42.	These rules take effect against the background of legal policies recognised in the case law.  One such policy is the need for certainty in commercial contracts, a policy which since Lord Mansfield’s time has run as a thread through the jurisprudence.  That need for certainty applies as well in commercial negotiations and to the question of whether a contract has come into existence: see Cobbe v. Yeoman’s Row Management Ltd [2008] UKHL 55; [2008] 1 WLR 1752, at [91] per Lord Walker.  A second policy is that in commercial dealings the reasonable expectations of honest, sensible business persons must be protected.  In giving the judgment of the Supreme Court in RTS Flexible Systems Ltd v. Molkerei Alois Muller GmbH, Lord Clarke, at [50], approved dicta of Steyn LJ in G. Percy Trentham Ltd v. Archital Luxfer Ltd [1993] 1 Lloyd’s Rep 25, that when considering whether a contract has come into existence, “the governing criterion is the reasonable expectations of honest sensible businessmen.  Contracts may come into existence, not as a result of offer and acceptance, but during and as a result of performance” (see also First Energy (UK) Ltd v. Hungarian National Bank Ltd [1993] BCC 533, 533, per Steyn J).  In a further passage in Percy Trentham, also approved by Lord Clarke, Steyn LJ said that a matter of importance to be considered in contract formation was
“the impact of the fact that the transaction is executed rather than executory…  The fact that the transaction was performed on both sides will often make it unrealistic to argue that there was no intention to enter into legal relations.  It will often make it difficult to submit that the contract is void for vagueness or uncertainty.  Specifically, the fact that the transaction is executed makes it easier to imply a term resolving any uncertainty, or, alternatively, it may make it possible to treat a matter not finalised in negotiations as inessential.” at page 27.
In my view the same realistic approach must be taken in deciding whether a party has accepted an offer through its conduct.
43.	In the classic analysis of offer and acceptance the Deal Memo sent by Reveille on 16 February 2011 was an offer.  When Mr Stevens returned the amended form on 28 February 2011 that was a counter-offer by Anotech, which required acceptance by Reveille.  The provision that the Deal Memo would not be binding on Reveille, unless it signed, was clearly for its benefit, the explanation for the existence of this provision being that this was almost certainly Reveille’s standard form.  Reveille did not sign which, because of Mr Stevens’s amendments to the Deal Memo, meant that the offeree had not signed.
44.	In not signing, Reveille as offeree was waiving a prescribed mode of acceptance, set out for its benefit. That was effective so long as there was no prejudice to Anotech as offeror.  The only prejudice Mr Cook could point to for Anotech was the commercial uncertainty as to whether it was bound by the Deal Memo.  That pales into insignificance when Anotech was receiving all the benefit of Reveille’s performance of the Deal Memo’s terms.  Indeed objectively Anotech could not have thought that it was prejudiced when from the outset it actively facilitated performance by Reveille of what Reveille was doing under the Deal Memo in integrating The Cookware Company’s products into the recording of the MasterChef episodes and licensing Anotech to use the MasterChef brand in marketing its cookware products in North America.
45.	Thus in my view the judge was right to focus on whether there were clear and unequivocal acts on Reveille’s part, which Anotech knew about, to constitute acceptance by conduct of Mr Stevens’s counter-offer.  To my mind, there is clear evidence of acceptance by conduct on Reveille’s part, conduct in which Anotech was closely involved.  First, in early March, Reveille integrated Anotech’s products into the making of the three episodes of MasterChef: Anotech had sent the 120 boxes of its cookware products for this purpose in late February and then on 10 March sent talking points used by Gordon Ramsay and the other presenters when the episodes of MasterChef were recorded over the period 10-18 March.  Secondly, Reveille approved Anotech’s request to deploy Reveille’s intellectual property in the MasterChef brand at the Chicago show in the second week of March, Reveille having made clear that approval would turn on Anotech’s signature of the Deal Memo.  That was associated with steps such as the Shine/Reveille press release of 11 March 2011, approved by Anotech, announcing to the world that Anotech was one of the new partners in the MasterChef series and had presented its MasterChef branded cookware at the Chicago show.  Thirdly, Reveille treated Anotech as one of its licensees, jointly emailing it and other licensees on 11 March, leading to Anotech participating in Reveille’s weekly conference calls with other licensees, the first such occasion being just over a week later.
46.	The judge did not identify a date when a contract came into effect.  At one point he indicated that acceptance had occurred by early March, in another passage suggesting that it could have occurred before Fox approval was received on 7 March.  But when discussing integration and licensing as conduct constituting acceptance the judge mentioned events which occurred much later than early March.  It can sometimes be difficult where acceptance by conduct involves a series of acts to pinpoint a precise date when a contract is formed.  To my mind the various acts on Reveille’s part, of which Anotech was well aware, led to a binding contract on the terms of the Deal Memo around 12 March 2011.  By then recording of the MasterChef episodes had begun, the Chicago show had just finished and the press had been briefed, and Reveille was treating Anotech as one of its licensees along with its other licensees.
47.	Conduct after 12 March 2011 does not go to acceptance by Reveille of Anotech’s offer but is evidence that the parties believed that there was a binding contract in place.  For this reason these later events were legally relevant. In my view the judge was correct in concluding that by this conduct the parties were not merely acting in anticipation of a contract which was never made but were acting pursuant to a binding contract, the terms of which were set out in the Deal Memo.  On Reveille’s side it performed its obligations under the Deal Memo.  It continued to involve Anotech in emails and conference calls with other licensees, and Anotech participated.  Importantly, Reveille’s production of the programmes for MasterChef continued and moved to completion, the episodes being broadcast over the summer on Fox.  Indeed Reveille performed all of the work envisaged for it by the Deal Memo.  In passing, it may be noted that at no point during the period when Reveille was doing this did Anotech suggest that there was no contract between them.
48.	As to Anotech, it acted as if it was bound as well.  It represented to Reveille that it was one of its licensees.  It worked and communicated with others on the basis that a deal was in place.  It negotiated over the long form agreements, which the Deal Memo contemplated would replace it.  It facilitated Reveille’s performance of its obligations by providing imagery for editing into the MasterChef programmes. And in September Mr Stevens emailed that Anotech had to pay Reveille, the judge finding as a fact that this acknowledgment of liability was referable to the Deal Memo, not to any debt under the long form agreements which, of course, were never signed. 
49.	There is nothing standing in the way of these conclusions.  Mr Cook argued that there could not be a contract because Fox approval, given on 7 March 2011, was never conveyed to Anotech.  But that comes up against the judge’s findings that Fox approval was not a pre-condition to the formation of any contract, the reality that Fox approval was a formality (as Anotech was told), and the fact that it did not prevent either party from acting as if it was contractually bound.
50.	Mr Cook highlighted that there was a long delay in Reveille invoicing Anotech for payments, which would have been due if the Deal Memo were binding. There are a variety of commercial and practical reasons, however, for creditors not pressing a debtor for payment.  The judge made no finding as to the reason for the delay.  Whatever it was it was more than counterbalanced by the various other factors demonstrating that both parties believed that there was a contract, not least Mr Stevens’s acknowledgment in September that the first payments were owing and would be paid by return.
51.	One issue remains, unfortunately one not addressed by the judge.  It will be recalled that on 12 April 2011 Mr Stevens was asked whether he was willing to sign the Deal Memo, without his amendment regarding Gordon Ramsay, and responded that to his knowledge the matter had not been resolved.  The judge found that it had been resolved, almost six weeks previously, by Reveille having Gordon Ramsay’s description on the QVC website changed.  Reveille’s invitation to Mr Stevens to sign was certainly not a counter-offer since, as I have concluded, there was a binding contract a month before.  As a matter of legal analysis, Mr Stevens was raising a breach of contract, although in fact the matter had already been resolved by Reveille.  
52.	The reality seems to be, as Mr Stone submitted, that Reveille’s invitation to Mr Stevens to sign the Deal Memo in its original form was an attempt to have a document executed reflecting the terms of the contract the parties were performing.  As regards Mr Stevens’s refusal to sign, in the belief that the issue had not been resolved, and the failure of Reveille to pursue the matter, I accept Mr Stone’s submission that there was no pressing need for Reveille to insist on Anotech’s signature, since both parties were performing the terms of the contract between them, and it was anticipated that the long form agreements then in negotiation would supersede it.
53.	In summary, Reveille waived the provision that there would be no binding contract in the absence of its signature on the Deal Memo, and there was no prejudice from this to Anotech.  There was acceptance by conduct on Reveille’s part of the terms of the Deal Memo, leading to a binding contract around 12 March 2011.  Subsequent conduct on both sides was confirmation of the existence of that contract. Reveille’s failure to sign the contract was at the expense of certainty as to the precise date the contract was formed.  However, Reveille performed all its obligations as set out in the Deal Memo with Anotech’s involvement and to Anotech’s benefit.  The upshot of the legal analysis, that the Deal Memo was a binding contract between Reveille and Anotech, accords with what would be the reasonable expectations of Lord Steyn’s honest, sensible business people.
Conclusion
54.	I would dismiss the appeal.
Lord Justice Underhill:
55.	I agree.
Lord Justice Elias:
56.	I also agree.