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39. Assuming that all appropriate defenses are timely raised, will the bottling company likely succeed in recovering $40,000 in consequential damages from the wholesaler?
A bottling company sent a purchase order to a wholesaler that stated, «Ship 100,000 empty plastic bottles at the posted price.» Two days after receipt of this purchase order, the wholesaler shipped the bottles and the bottling company accepted delivery of them. A week after the bottles were delivered, the bottling company received the wholesaler's acknowledgment form, which included a provision disclaiming consequential damages. After having used the wholesaler's bottles in its bottling operations for two months, the bottling company discovered a defect in the bottles that caused liquids to leak from them. The bottling company recalled 10,000 of the bottles that had been filled, incurring lost profits of $40,000.
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UCC § 2-207 departs from the «mirror-image» common law rule that requires the acceptance to match the offer. Contracts for the sale of goods may be formed even when the acceptance differs from the offer. Under § 2-207, between merchants, any additional terms proposed in the acceptance can become part of the contract under certain circumstances if the other party remains silent. An additional term will automatically be part of the contract UNLESS the additional term materially alters the contract or the other party objects to its addition. In either case, it will not automatically be added to the final agreement. Whether an additional term «materially alters» the contract is decided on a case by case basis. A disclaimer of warranties will almost always be found to materially alter a contract, and thus not be added.
D is correct. When the wholesaler shipped the requested bottles to the company, this was an acceptance of the company's purchase order of the bottles. The wholesaler sent the acknowledgment form after the shipment was received. That form's provision disclaiming liability, if added, would materially alter the contract. As such, the provision would not be added to the contract and the bottling company has the right to sue for the $40,000 in consequential damages from the leaky bottles.
A is incorrect. This answer misstates the rule concerning consequential damages. Buyers generally are entitled to recover consequential damages, subject to certain specified limitations such as the requirement that damages, to be recoverable, must be foreseeable at the time the contract was made. The contract was created in this case when the wholesaler shipped the bottles. The subsequent acknowledgment form containing the disclaimer never became part of the contract, as stated above. There are no facts that would support an exception to the general rule that buyers are entitled to recover consequential damages and the bottling company will prevail.
B is incorrect. The acknowledgment form did not arrive until a week after the shipment of the bottles. Moreover, by seeking to materially alter the agreement, the acknowledgment form's provision disclaiming liability would not be added to the contract.
C is incorrect. This answer correctly concludes that the bottling company will recover consequential damages, but it misstates the reasoning for this conclusion. While disclaimers of consequential damages might sometimes be found unconscionable, the mere existence of such a disclaimer is not enough to establish unconscionability, and there is no evidence in this case that would otherwise suggest that the contract was unconscionable.