CBS claimed that the contract did not provide for a withdrawal charge. Who will prevail? Why?
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In September, Auburn Plastics (defendant) submitted price quotations to CBS (plaintiff) for the manufacture of eight cavity molds to be used in making parts for CBS’s toys. Each quotation specified that the offer would not be binding unless accepted within fifteen days. Furthermore, CBS would be subject to an additional 30 percent charge for engineering services upon delivery of the molds. In December, CBS sent detailed purchase orders to Auburn Plastics for cavity molds. The purchase order forms stated that CBS reserved the right to remove the molds from Auburn Plastics without an additional or “withdrawal” charge. Auburn Plastics acknowledged the purchase order and stated that the sale would be subject to all conditions contained in the price quotation. CBS paid Auburn for the molds, and Auburn began to fabricate toy parts from the molds for CBS. Later, Auburn announced a price increase, and CBS demanded delivery of the molds. Auburn refused to deliver the molds unless CBS paid the additional charge for engineering services. CBS claimed that the contract did not provide for a withdrawal charge. Who will prevail? Why? |
Explanation
Here, C. will prevail because of the terms decided during the time of acceptance of the contract by C. In this scenario, plaintiff has made the offer to purchase the molds and defendants had accepted the offer by making acknowledgement for the decided terms. The defendant’s acceptance here includes the 30% additional charges in the contract. Hence, the acceptance of the contract terms will add the terms decided in the contract, but any other charge will not be applicable on the contract.
Verified Answer
C. will prevail.
Here, C. offers to buy the molds and A. accepted that order by acknowledging the offer and accepting the price discussed. Sudden implication of charges applicable by A. on the contract does not bound C. to pay it, as it will not become a part of the contract.
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