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Textile v. BMH
From wikilawschool.net. Wiki Law School does not provide legal advice. For educational purposes only.
| Textile v. BMH | |
| Court | 9th Circuit |
|---|---|
| Citation | 240 F.3d 781 |
| Date decided | February 14, 2001 |
Facts
- Textile Unlimited, Inc. = "Textile" = plaintiff = yarn buyer
- A..BMH and Company, Inc. = "BMH" = defendant = yarn seller
- Over a 10-month period, Textile bought yarn from BMH in 38 transactions
- Textile would send purchase orders to BMH which would send back invoices
- The invoices of BMH would include contract terms differing from the purchase orders of Textile
- The invoices of BMH stipulated that the acceptance of its yarn product would mean that Textile was accepting the terms of the sale (which contradicted the purchase orders of Textile)
- Additionally, BMH invoices specified that disputes of the sales would have to be arbitrated in Atlanta, Georgia
- When 1 shipment contained defective yarns, Textile refused to remunerate BMH
Procedural History
- BMH submitted its dispute to arbitration because Textile hadn't paid for its yarn shipment
- Textile sued BMH in a federal district court in the Central District of California to prohibit ("enjoin") the arbitration
- BMH lost in the district court in California
- BMH appealed to the 9th Circuit
Issues
In a contract implied by conduct under the UCC, will additional terms on which the parties don't agree drop out of the contract?
Holding
- Yes. In a contract implied by conduct under the UCC, additional terms on which the parties don't agree will drop out of the contract.
- The district court in California didn't abuse its discretion in enjoining the arbitration.
Judgment
Affirmed
Reasons
Judge Thomas: The BMH invoice = counter-offer != acceptance
Rule
- UCC § 2-207 governs contract interpretation when the contracting parties have exchange conflicting forms.
- The UCC doesn't have any arbitration provisions.
- In contrast, the last-shot rule of the common law is in contradiction of the UCC when it comes to the "battle of the forms."
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