Bayway Refining and Oxygenated Marketing and Trading A.G. (OMT) were both in the business of buying and selling petroleum products. Bayway agreed to sell OMT 60,000 barrels of gasoline, and OMT faxed a confirmation letter stating that it represented the full understanding of the parties. The next day, Bayway faxed its own confirmation letter, which stated that the document canceled and superseded any other correspondence. Bayway’s fax incorporated by reference Bayway’s own “General Terms and Conditions.” Those general terms were not sent with the fax, but were available for OMT to examine if it wished. One of those terms stated that the buyer would be responsible for any federal taxes. OMT, which never objected to the “general terms,” received the gasoline but refused to reimburse Bayway for the federal taxes, which amounted to $464,035. Bayway sued. OMT claimed that the tax clause materially altered the contract and, under section 2-207, never became part of the agreement. The District Court gave summary judgment for Bayway, and OMT appealed Issue: Was the tax clause a material alteration of the contract? Holding: Judgment for Bayway affirmed. Under UCC §2-207(2)(b) the party opposing the inclusion of additional terms shoulders the burden of proving they were a material alteration of the contract, which is an alteration that would result in surprise or hardship if incorporated without express awareness by the other party. To carry the burden of showing surprise, a party must establish that under the circumstances, it cannot be presumed that a reasonable merchant would have consented to the additional term. OMT’s executives testified they were amazed by the “contract by ambush” and “sleight-of-hand proposal,” but OMT introduced no evidence to show that a reasonable petroleum merchant would be surprised by the Tax Clause. Two industry experts offered unchallenged testimony that it is customary for the buyer to pay all the taxes resulting from a petroleum transaction. An additional term creates hardship when it creates or allocates an open-ended and prolonged liability. That is not the case here. Required: a. What is the disputed clause? b. Which party proposed this term? c. When did OMT first see the tax clause? d. But Bay way sent a fax confirming the agreement. Didn’t that fax contain the tax clause? e. What does “incorporate by reference” mean? f. You mean that OMT can supposedly agree to terms it never saw? g. Isn’t that crazy? h. Doesn’t the mirror image rule preclude a contract here?
> Ibrahim Boumelhem, aged four, began playing with a Bic disposable lighter that his parents had purchased. He started a fire that burned his legs and severely burned his six-month-old brother over 85 percent of his body. Ibrahim’s father sued Bic, claimin
> The Alden Leeds company packages, stores, and ships swimming pool chemicals. The firm does most of its work at its facility in Kearns, New Jersey. At any given time, about 21 different hazardous chemicals are present. The day before Easter, a fire of unk
> On a warm California day, there were about 30 personal water craft (jet skis) operating on Coyote Lake. The weather was fair and visibility good. Anthony Nguyen and Rachael Truong went for a ride on Anthony’s Polaris watercraft. Cu Van Nguyen and Chuong
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> At the University of Arizona, the Epsilon Epsilon chapter of Delta Tau Delta fraternity gave a welcoming party for new members. The fraternity’s officers knew that the majority of its members were under the legal drinking age, but they permitted everyone
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> J. Sanders, Inc. had a contract with the federal government to install the heating system at a federal prison camp. The company negotiated with Superior Boiler Works to purchase three large commercial units. On March 27, Superior sent a proposal to Sande
> Ivan Tepper, the CEO of Delta Star, met with the sales manager at Michael’s, a flooring company. In a verbal agreement, he hired Michael’s to install carpet in the entryway of his office suite, and tile in his personal office and the office of Nash, his
> Sarah Jones, a high school teacher and Cincinnati Bengals cheerleader, was the subject of several posts on TheDirty.com, a gossip website run by Nik Richie. Anonymous submissions accused Jones, among other things, of being promiscuous with many football
> ProCD sold SelectPhone, a database containing information from 3,000 telephone directories. It sold the software to consumers for $150; business paid a much higher price. Every box containing the consumer version of SelectPhone was wrapped in plastic shr
> LAN Systems, Inc. (“i.LAN”), helps companies monitor their computer networks. NetScout Service Level Corp., formerly known as NextPoint Networks, Inc. (“NextPoint”), sells sophisticated software that monitors networks. In 1998, i.LAN and NextPoint signed
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> Christopher Rottner’s computer began malfunctioning – its performance decreased, and the Internet speed was sluggish. Searching for a solution, he found a free trial of PC TuneUp online from AVG. AVG claimed that the software would boost Internet speed,
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> Legends are Forever, Inc. (Legends) trademarked the slogan “Legends are Forever.” When Nike used the slogan in an ad campaign featuring basketball player Kobe Bryant, Legends sued Nike. But, during discovery, Legends repeatedly failed to comply with Nik
> Michael Brooks desperately needed financing for his company, BrooksAmerica, so he agreed to a sale-leaseback agreement with Terminal Marketing Co. Terminal would pay BrooksAmerica $250,000, and in exchange would obtain title to BrooksAmerica's computers
> MSC owned a shopping center and leased space to Tenet for use as an outpatient surgery and general medical practice. According to the lease, Tenet could assign with the consent of the lessor, and said consent would not be unreasonably withheld. MSC sold
> The California Department of Parks and Recreation (DPR) and Delaware North Companies (DNC) entered into a contract giving DNC the right to operate a concession stand at a state park in San Diego for 10 years. Four years into the contract, DNC assigned it
> Miller listed her home for sale. On August 4th, Norman made an offer, specifying that it must be accepted by 5:00 p.m. on August 5th. Miller received the offer, made several changes, signed it, and returned it to Norman. Norman did not respond. On August
> The state of Alaska entered into a contract with Corrections Corporation of America (CCA), a private company, to house Alaska’s inmates. The contract required CCA to abide by the terms of a settlement agreement between the state and its inmates known as
> Juzwiak was a tenured teacher at Hightstown High School in New Jersey. He received three emails from someone who signed himself “Josh,” with the address, “Josh Hartnett “. The teacher did not know anyone of that name. These emails said: 1. Subject line:
> After his wife left him, Anthony Elonis changed his Facebook name to “Tone Dougie” and began posting self-styled rap lyrics containing violent language and imagery about his friends and family. Elonis always posted disclaimers stating that the lyrics wer
> Donna and Alan Smith wanted to raise emus, which are flightless Australian birds that look like ostriches. The creatures reproduce rapidly in almost any terrain and are sold for their meat, which is high in protein and low in fat, and for their oil, leat
> For years, Hai Yun, a Chinese instrument manufacturer, made high-quality drums for Armadillo, which was a major distributor of musical instruments in the United States. Armadillo put great time and effort into developing a new line of drum kits called “D
> Byblos sold off price designer clothing manufactured by an Italian parent company. Morris & Sons was a Chicago retailer that had been selling men’s and women’s clothing for 40 years. Aaron Krichevsky, the president of Morris, contacted Patricia Saracini,
> Edward and Kelly Kiesel bought a trailer from James Lile, the owner of Lile’s Trailer Sales. That same day, the Kiesels used the trailer. The next morning, after an all-night rain, the Kiesels noticed water inside the trailer, near the door. The next tim
> Zion Temple First Pentecostal Church ordered new choir robes from Brighter Day Bookstore, a retailer that sold robes manufactured by Murphy Cap & Gown. When Brighter Day delivered the robes to the Zion Temple, the church members found many faults. They
> Burton is a Vermont-based designer, manufacturer, and seller of snowboards. ViQuest is a manufacturer of injection-molded products based in Shanghai, China. Burton and ViQuest contracted for ViQuest to manufacture Burton’s snowboard bindings. The agreem
> In setting rules for Internet infrastructure, the FCC ruled that broadband ISPs are not common carriers and, therefore, not subject to rules that require equal treatment for all their customers. However, the Commission later became concerned that ISPs mi
> Machado Ford published the following newspaper ad: “Buy a New Ford and Get $3,000 Minimum Trade-In Allowance.” Izadi attempted to purchase a new Ford Ranger valued at $6,595 for $3,595 in cash plus his trade=in (assuming the minimum trade=in allowance).
> James Huff was the chairman of the Kenton County Airport Board, which manages the Cincinnati/Northern Kentucky International Airport (CVG). While at a conference in Italy with his wife Bertha and a colleague named Larry Savage, Huff used his iPhone to ca
> Deborah Ehling, a registered nurse and paramedic who worked at the Monmouth-Ocean Hospital Service Corporation (MONOC) reacted on her Facebook page to a shooting. Her Facebook privacy settings limited access to just “friends.” Management members were not
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> While attempting to pass several cars on a two-lane road, Campbell drove into oncoming traffic. An innocent driver swerved to avoid Campbell and died in a collision with a third driver. The family of the deceased driver and the surviving third driver bot
> Late one night, an anti-abortion protestor named Robert Thomas climbed into a dumpster located behind the Women's Advisory Center, an abortion clinic. He found documents indicating that the plaintiffs were soon to have abortions at the clinic. Thomas gav
> Organon fired John Soldau, then sent him a letter offering to pay him double the normal severance pay, provided Soldau would sign a full release for any claims he might have against the company. Soldau signed the release and deposited it in the nearest p
> The plaintiffs sued Netscape, claiming that its SmartDownload software illegally captured private information about files they downloaded from the Internet. Plaintiffs downloaded the SmartDownload software from a page on Netscape’s web that promoted the
> Matthew Gabriel was a student in Professor Pumo’s immunology class. Professor Pumo’s syllabus outlined course requirements and stated that “plagiarism will not be tolerated.” After grading the first assignment, Professor Pumo realized that many papers ha
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> When a Tom Cat Bakery delivery van struck Elizabeth Nadel, she suffered significant injuries, Nadel filed suit. Before the trial, Tom Cat’s attorney offered a $100,000 settlement, which Nadel refused. While the jury was deliberating, the bakery’s lawyer
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> An offer is an act or statement that proposes definite terms and permits the other party to create a contract by accepting those terms. Sometimes we forget that by making a valid offer, we give that power to the other person. Sometimes corporate officers
> Attorney James Mason represented Nelson Serrano, who was accused of killing four people in Central Florida. But Serrano had an alibi: On the day of the crime, hotel surveillance in Atlanta had captured him on video – both before and after the murders. Th
> Elijah Turley was a steelworker at the Lackawanna company’s plant near buffalo, New York. For over a decade, he was the only African-American in his department. For the last three years of his employment, Lackawanna employees tormented and degraded Turle
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> Citizens Publishing was a family-owned corporation that published the Ellwood City Ledger and another local newspaper. Bud Dimeo had been the company’s sole photographer for over 35 years. When the needs for daytime photography declined, Citizens began r
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> For 12 years, David Brune taught theater and drama at the Dalton School, an elite private school in New York City. Like other Dalton faculty, he worked on a renewable one-year contract. The school chose Thoroughly Modern Millie as the middle school’s an
> Exide Technologies issued repeated warnings to Robert Peterson for driving forklifts too fast and violating other safety rules. After he was injured in a forklift crash, Exide granted him FMLA leave for 10 days while he recovered. Peterson’s manager fire
> The voters of Washington State passed the Medical Use of Marijuana Act (MUMA) which stated that: Humanitarian compassion necessitates that the decision to authorize the medical use of marijuana by patients with terminal or debilitating illnesses is a pe
> The Tufte family leased a 260-acre farm from the Travelers Insurance Co. Toward the end of the lease, Travelers mailed the Tuftes an option to renew the lease. The option arrived at the Tuftes’ house on March 30, and gave them until April 14 to accept. O
> The Rosenbergs owned a Dairy Queen in Grand Forks, North Dakota. They agreed in writing to sell the Dairy Queen to Mary Pratt. The contract required her to pay $10,000 down and $52,000 over 15 years, at 10 percent interest. Two years later, Pratt assigne
> Mary Johnson signed a contract with Mayflower to perform repair work on her home for a fee of $25,900. Mayflower arranged for Johnson to pay for this work by borrowing money from Sterling Resources. The note she signed with Sterling had an unconscionably
> Steven Vlohotis was a salesman for NESCOR, a home improvement company. He convinced the Antunas to sign a consumer credit contract with NESCOR to install vinyl siding and windows. The contract provided that the Antunas would pay for the improvements in i
> Creative Ventures, LLC (Creative) borrowed nearly $3 million from defendant Jim Ward & Associates (JWA) to buy property in California. Creative signed promissory notes, payable to JWA. Thereafter, JWA sold this entire loan to 54 individual investors (Inv
> Maude Rosenbaum wanted to post bail to get out of prison. Harvey Bowen agreed to post bail of $7,500 in return for a $7,500 promissory note signed by Rosenbaum and secured by her house. Bowen was not a licensed bondsman and therefore, under state law, wa
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> Brican LLC was running a scam. The victims were dentists who wanted to lease multimedia systems (called Exhibeos”) for use in their waiting rooms. Each Exhibeo consisted of a computer and a television which could, say, demonstrate proper flossing techniq
> Christina Blasco entered into a “payday loan” with Money Services Center (MSC). MSC loaned Blasco $500 and return Blasco left MSC with a signed check for $587.50 which it promised not to cash for two weeks. (Note that Blasco is laying 17.5% interest for
> A court in Nevada entered an award in favor of Mark and Janet Brandell for $435,066.82 against United Productions, Inc. (UP) and Harry R. Jones. When UP and Jones failed to pay the judgment, the court ordered both of them to appear and answer questions c
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> Arthur Andersen audited Enron Corporation’s financial statements. When Enron’s financial and accounting problems began to surface at the beginning of August, a senior accountant at Enron told two Andersen partners that Enron could face severe accounting
> The town of Sanford, Maine, decided to auction off a lot it owned. The town advertised that it would accept bids through the mail, up to a specified date. Arthur and Arline Chevalier mailed in a bid that turned out to be the highest. When the town refuse
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> ABAT was a Delaware corporation operating in China that designed and manufactured lithium batteries for use in consumer products. Because its stock was listed on a U.S. stock exchange, ABAT was required to file financial statements with both the U.S. Sec
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> The First National Bank of Keystone could do nothing right. For five years, it issued risky mortgage loans on which borrowers defaulted. Keystone Management lied about the value of the loans. When the Office of the Comptroller of the Currency (OCC) began
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> In 1960, The New York Times ran a full-page advertisement paid for by civil rights activists. The ad described an “unprecedented wave of terror” by the police of Montgomery, Alabama, against civil rights protesters. It stated that the police had assaulte
> It was late night at the Del Lago hotel bar. Bradley Smith and 40 of his closest fraternity brothers had been partying there for hours. Around midnight, guests from a wedding party made a rowdy entrance. One of Smith’s friends brashly hit on a young woma
> Maria Kerkoulas owned the Pub Zone bar, frequented by many motorcycle gangs, and knew from her own experience and conversations with police that some of the gangs, including the Pagans, were dangerous and prone to attack customers for no reason. Kerkoula
> The defendant, attempting to heal the plaintiff, left him blind in one eye. The plaintiff has sued in trespass, a forerunner of today’s tort action. The defendant made a procedural argument, claiming that the plaintiff should have brought an action of co
> Discovery in civil litigation is rarely the subject matter for legal dramas on television or in the movies, so the discussion of discovery will be unfamiliar to many students. Students should understand its role in our adversary system as defined in the
> Microsoft Libya hired a Libyan citizen, Mahmoud Kedkad, to work as a Marketing Lead in Tripoli. Kedkad signed a one-year employment agreement (2010 Contract) providing that: This contract is subject to the prevailing labor law applicable in Libya. The L
> Oak Ridge FM, Inc. and Dick Broadcasting Company (DBC) entered into a contract that gave DBC a right of first refusal to purchase all the assets of Oak Ridge’s radio station WOKI-FM. The agreement also provided that: No party may assign its rights, inte
> Heritage wanted to buy a substance called TBCC from Phibro but, because of uncertainty in the industry, the two companies could not agree on a price for future years. It turned out, though, that the price of TBCC tended to rise and fall with that of copp
> Scott Minkler alleged that when he was a child, his Little League baseball coach, David Schwartz, had molested him. During the period when these terrible events occurred, David was living at the home of his mother, Betty Schwartz, and some of the episode
> Jones Brothers Construction was the general contractor on a job to expand American Airlines facilities at O’Hare International Airport. Jones Brothers invited Quake Construction to bid on the employee facilities and automotive maintenance shop (“the proj
> Dr. Robert Mayo was a tenured faculty member of the engineering department at North Carolina State University (NCSU). In July, he informed his department chair, Dr. Paul Turinsky, that he was leaving NCSU effective September 1. Turinsky accepted the resi
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> Mr. and Ms. Ahrens wanted to buy a trailer court owned by Charles Dodd. The Ahrenses drafted and signed a contract to buy “Blue Bell Trailer Court” for $305,000. The contract stated that the trailer court included 31 acres. Dodd held the deed to a 33.72-
> From May 1992 through January 1993 plaintiff Bed, Bath & Beyond negotiated with defendant La Jolla Village Square Venture Partners (“La Jolla”) for a lease of retail space in La Jolla Village Square, a shopping center La Jolla was then in the process of
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> As introduced in the chapter opener, Howard Browning and Lynn Poirier were a couple. Early on, they promised to share any lottery winnings equally. Fourteen years after that oral promise, Poirier purchased a winning ticket and collected one million dolla
> Tommy and Eleanor Daves gave their daughter Lisa Baker the deed to a two-acre property with a house on it, keeping for themselves a life interest in the parcel. When they died, the property returned to their daughter. Two years later Tommy and Eleanor di
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