Diamond Fruit Growers, Inc. V. Krack Corp. Case Brief

666 words - 3 pages

Diamond Fruit Growers, Inc. v. Krack Corp.
794 F.2d 1440
C.A.9 (Or.), 1986.
Facts: Krack Corp. manufactures cooling units that have metal tubing. Metal-Matic is one of Krack’s suppliers of tubing. During the last ten years the parties have had the same course of dealing. At the beginning of the year Krack would send a blanket purchase order to Metal-Matic. They followed this by sending release purchase orders as tubing was needed. Metal-Matic responded by sending an acknowledgement form and shipping the tubing. Metal-Matic’s acknowledgment form disclaimed all consequential damages and limited liability to refund, repair or replacement. Metal-Matic expressly made its assent ...view middle of the document...

UCC §2-207 modifies the common law’s mirror image rule. At common law an acceptance that varies the terms is a counteroffer. If the offeror goes ahead after receiving the counteroffer, his performance is an acceptance of the terms of the counteroffer. An underlying principle of UCC §2-207 is neutrality. It aims to not give one party over another an advantage by simply sending the first or in some cases the last form. It accomplishes this by doing away with the common law’s last shot rule. It gives neither party the terms it attempted to impose unilaterally. This requires a specific and unequivocal expression of assent on the part of the offeror when the offeree conditions its acceptance on assent to additional or different terms. Since Krack did not unequivocally express its assent then UCC §2-207(3) would apply to fill in the terms of the contract. Metal-Matic’s disclaimer of liability did not become part of the contract. Court affirms lower court ruling.
Effect on Business and Society: This case demonstrates the importance of knowing...

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