McEvoy was hired to build oil rigs in the North Sea. It contacted Axelson about building actuators,

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McEvoy was hired to build oil rigs in the North Sea. It contacted Axelson about building actuators, complex pieces of equipment, for the rigs. Axelson sent a price quote with terms good for 60 days. McEvoy said it needed more time and accepted no deviations from its standard form contract. Axelson granted more time. The parties dickered for months, until McEvoy sent a "letter of intent" that spelled out terms but said it needed to see technical specifications to finalize the deal. Axelson did not want to provide all details without a firm order because the specs included trade secrets, but after being assured the order was a done deal, it sent the specs. Months later, after work started, McEvoy sent a form purchase order that stated it contained all terms of the contract and nothing else applied. One term was that McEvoy had the right to cancel the order at any time and was not liable for losses.

1. The appeals court affirmed that the parties had formed a contract prior to the final form contract sent by McEvoy, so its terms did not control the agreement. Hence, the rules of the UCC would settle the dispute and allow damages to be paid. What is the rationale in the UCC for not allowing the final form, as in this case, to control?
2. How did the court determine when the contract came into being?

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The Legal Environment of Business

ISBN: 978-0538473996

11th Edition

Authors: Roger E Meiners, Al H. Ringleb, Frances L. Edwards

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