What You'll Learn

  • Section 2-207(1): formation by writings
  • Section 2-207(2): additional terms
  • Different terms
  • Section 2-207(3): formation by conduct
  • Exam flowchart

Educational information only; not legal advice. This article is a general study aid and should be checked against current authority and course materials.

1. Subsection (1): Did the Response Operate as Acceptance?

A definite and seasonable expression of acceptance or written confirmation can operate as acceptance even though it states additional or different terms. The major exception is a response that makes acceptance expressly conditional on the offeror’s assent to the new terms.

● Definite: the response shows a willingness to commit to the transaction. ● Seasonable: it arrives within the agreed time or a reasonable time. ● Dickered terms: a purported acceptance that departs from an expressly negotiated core term may not be a genuine acceptance. ● Expressly conditional: the response must clearly say no contract exists unless the offeror assents to the new terms; language merely stating “our terms control” may be insufficient.

2. Subsection (2): What Happens to Additional Terms?

An additional term addresses an issue the offer did not address. If one or both parties is not a merchant, the term is ordinarily a proposal that becomes part of the contract only through affirmative agreement. Between merchants, the term ordinarily enters automatically unless an exception applies.

Between merchants: additional term does not enter if... Why

The offer expressly limits acceptance to its own terms. The offeror used a clear “my terms only” limitation.

The term materially alters the proposed contract. It would create unfair surprise or significant hardship.

The offeror already objected or objects within a reasonable time. Timely objection prevents incorporation.

Key Takeaway

The outlines emphasize surprise and economic significance. A clause that changes a major risk allocation, remedy, warranty, arbitration obligation, or payment exposure is more likely material than a commercially routine clarification.

3. Different Terms: Flag the Split

A different term conflicts with a term already in the offer. The materials describe two approaches. The majority knock-out rule removes both conflicting terms and allows a UCC gap-filler to govern. A minority first-shot approach keeps the offeror’s original term and drops the conflicting response term. State the split when the jurisdiction is not specified.

4. Subsection (3): The Parties Perform Anyway

Even if the writings do not establish a contract, conduct by both parties recognizing a sale can create one. Shipment, delivery, payment, use, and acceptance of goods may show agreement. The resulting contract consists of terms on which the writings agree, together with UCC supplementary terms. Conflicting boilerplate usually drops out.

5. Exam Flowchart

1 Identify the offer and the responsive form. 2 Under §2-207(1), ask whether the response is definite, seasonable, and not expressly conditional. 3 If acceptance occurred, classify each nonmatching term as additional or different. 4 For additional terms, determine merchant status and apply the three exceptions. 5 For different terms, state the knock-out/first-shot split. 6 If the writings did not form a contract, ask whether conduct did under §2-207(3). 7 State the resulting terms: agreed writings plus applicable UCC gap-fillers.

Key Takeaway

Buyer’s purchase order is silent on arbitration. Seller’s timely acknowledgment accepts the order and adds arbitration. Both are merchants. The term enters unless the offer limited acceptance, arbitration materially alters the deal, or Buyer objects in time. If Seller instead says, “We accept only if you assent to arbitration,” subsection (1) may not form a contract without Buyer’s assent.

Common Mistake

Do not assume every new term enters between merchants. Do not call a conflicting term “additional.” Do not use subsection (3) unless the writings fail or leave formation unresolved. And do not forget the expressly-conditional language.

Primary Authorities

  • ● U.C.C. § 2-207(1)-(3).

  • ● U.C.C. §§ 1-303 and 2-204.

Exam-ready conclusion

Section 2-207 is manageable when separated into formation, classification, merchant rules, conflicting-term rules, and conduct. Move in that order every time.