Contract Formation and Additional Terms: A Case Study, Slides of Contract Law

Download Contract Formation and Additional Terms: A Case Study and more Slides Contract Law in PDF only on Docsity! Livingston v. Evans • What is the question presented? Docsity.com Livingston v. Evans • What is the question presented? • Was P‟s counteroffer at a lower price a rejection precluding a later acceptance? Docsity.com Problem 29 • Gandalf offers to perform magic tricks for $3000 for Frodo‟s extravaganza • Frodo replies: „„I accept, but I plan to videotape your performance and show it monthly thereafter at park concerts.‟‟ • Is there a contract? Docsity.com Problem 29 • If Gandalf says nothing, but does perform and is videotaped, can he later object to the monthly showings? Docsity.com Problem 29 • What if, instead of the above, Frodo had replied, „„I agree to pay you $3,000, but you must be sober during the performance.‟‟ Is this a counteroffer?? Docsity.com § 2-207. Additional Terms in Acceptance or Confirmation. (1) A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms. Docsity.com § 2-207. Additional Terms in Acceptance or Confirmation. (2) The additional terms are to be construed as proposals for addition to the contract. Between merchants such terms become part of the contract unless: (a) the offer expressly limits acceptance to the terms of the offer; (b) they materially alter it; or (c) notification of objection to them has already been given or is given within a reasonable time after notice of them is received. Docsity.com COMMERCE & INDUSTRY INS. CO. v. BAYER CORP. • Malden P.O. says: • This purchase order represents the entire agreement between both parties, not withstanding any Seller‟s order form, whether sent before or after the sending of this purchase order, and this document cannot be modified except in writing and signed by an authorized representative of the buyer. Docsity.com COMMERCE & INDUSTRY INS. CO. v. BAYER CORP. • Malden Mills P.O. has an agreed arbitration clause. Docsity.com COMMERCE & INDUSTRY INS. CO. v. BAYER CORP. • Three ways to form a contract: 1. „„if the parties exchange forms with divergent terms, yet the seller‟s invoice does not state that its acceptance is made „expressly conditional‟ on the buyer‟s assent to any additional or different terms in the invoice, a contract is formed [under subsection (1) of §2- 207].‟‟ Docsity.com COMMERCE & INDUSTRY INS. CO. v. BAYER CORP. • Three ways to form a contract: 2. „„if the seller does make its acceptance „expressly conditional‟ on the buyer‟s assent to any additional or divergent terms in the seller‟s invoice, the invoice is merely a counteroffer, and a contract is formed [under subsection • (1) of §2-207] only when the buyer expresses its affirmative acceptance of the seller‟s counteroffer.‟‟ Docsity.com Problem 31 • Galsway and Forsyte reach agreement on the phone for sale fo tugboat and explicitly say a deal has been reached. • Galsway sends a P.O. • Forsyte sends an order acknowledgment containing warranty disclaimer and a use of the proviso of 2-207(1) What result? Docsity.com § 2-207. Additional Terms in Acceptance or Confirmation. (1) A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms. Docsity.com § 2-207. Additional Terms in Acceptance or Confirmation. (2) The additional terms are to be construed as proposals for addition to the contract. Between merchants such terms become part of the contract unless: (a) the offer expressly limits acceptance to the terms of the offer; (b) they materially alter it; or (c) notification of objection to them has already been given or is given within a reasonable time after notice of them is received. Docsity.com Problem 32 • Knock out rule (majority) both cancel each other out so neither are in the contract. Fall back on other law to determine law. No other law would insert the clause so there is no agreed arbitration. Docsity.com Problem 32 • Treat additional and differen the same way under 2-207 (minority view). Thus offer (arbitration) stands if no arbitration is a material alteration of the contract. Docsity.com § 2-207. Additional Terms in Acceptance or Confirmation. (1) A definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional or different terms. (2) The additional terms are to be construed as proposals for addition to the contract. Between merchants such terms become part of the contract unless: (a) the offer expressly limits acceptance to the terms of the offer; (b) they materially alter it; or (c) notification of objection to them has already been given or is given within a reasonable time after notice of them is received. Docsity.com