2-207 Question: Minneapolis & St. Louis Railway Co.

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canes
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2-207 Question: Minneapolis & St. Louis Railway Co.

Postby canes » Mon Jun 04, 2012 1:54 am

Way too late not to know this, but... In Minneapolis & St. Louis Railway Co. v. Columbus Rolling-Mill Co, how would 2-207 handle this?

The Plaintiff, Minneapolis & St. Louis Railway Co. (Plaintiff), approached the Defendant, Columbus Rolling-Mill Co. (Defendant), for a quote on iron rails to be delivered in March of 1880.

Defendant replied with an offer to sell 2000 to 5000 tons of 50 lb rails, which was to be accepted by December 20, 1879, to be valid.

On December 16, 1879 plaintiff wrote defendant ordering 1200 tons of rails.

Defendant responded that the order could not be taken at the agreed upon price and Plaintiff sued for performance.

When Plaintiff failed to accept Defendant’s offer on its face, Plaintiff later tried to accept under the original terms of 2000 to 5000 tons.

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I.P. Daly
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Re: 2-207 Question: Minneapolis & St. Louis Railway Co.

Postby I.P. Daly » Mon Jun 04, 2012 10:40 am

canes wrote:Way too late not to know this, but... In Minneapolis & St. Louis Railway Co. v. Columbus Rolling-Mill Co, how would 2-207 handle this?

The Plaintiff, Minneapolis & St. Louis Railway Co. (Plaintiff), approached the Defendant, Columbus Rolling-Mill Co. (Defendant), for a quote on iron rails to be delivered in March of 1880.

Defendant replied with an offer to sell 2000 to 5000 tons of 50 lb rails, which was to be accepted by December 20, 1879, to be valid.

On December 16, 1879 plaintiff wrote defendant ordering 1200 tons of rails.

Defendant responded that the order could not be taken at the agreed upon price and Plaintiff sued for performance.

When Plaintiff failed to accept Defendant’s offer on its face, Plaintiff later tried to accept under the original terms of 2000 to 5000 tons.


The above mentioned case dealt with the common law mirror image rule. Nonetheless, I'll take a crack at it, but no guarantees as to my accuracy.

C: Under the UCC, Minneapolis & St. Louis Railway Co. arguably did not validly accept Columbus Rolling-Mill Co.'s offer.

The issue is whether Minneapolis' December 16th telegram constituted a valid acceptance under the UCC.

First, the UCC would apply to this situation b/c it's a contract for the sale of goods. Next, it's a contact between merchants b/c both parties deal in goods of the kind.

Under 2-207, acceptance is defined as a definite and seasonable expression of acceptance or a written confirmation which is sent within a reasonable time operates as an acceptance, even though it states terms additional to or different from those offered or agreed upon, unless acceptance is expressly made conditional on assent to the additional terms.

There is a split in situations where an acceptance in a contract between merchants includes terms that are different than the offer. The majority of courts apply the "knockout" rule to differing terms, and both the offeror's original provision and the offeree's differing provision are omitted, and courts substitute the provision with "gap fillers." A minority of decisions treat a different term appearing in the acceptance as a mere proposal for alteration of the contract, which the offeror is free to accept or reject.

Applying the minority rule to this situation (don't have enough info to apply gap fillers), because Minneapolis' telegram provided differing terms from Columbus' offer, the differing terms are mere proposals for alteration that Minneapolis could freely reject. Thus, the parties did not form a valid contract under the UCC.




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