American Contract Law for a Global Age, 2017a

FLENDER CORPORATION v. TIPPINS INTERNATIONAL, INC.
Superior Court of Pennsylvania
830 A.2d 1279 (Pa. Super. 2003)
JOHNSON, J.
Tippins International, Inc., appeals the trial court’s order denying its motion
to compel arbitration under the terms of a commercial contract. The trial court
determined that the arbitration clause on which Tippins relies was merely a part of
its offer of purchase and never became a part of the parties’ contract. The court
determined, in addition, that the parties formed a contract through course of conduct
pursuant to section 2-207(3) of the Pennsylvania [Uniform] Commercial Code that
did not include an arbitration provision. [W]e affirm the court’s order.
This matter arose out of a “battle of the forms” in which the two contracting
parties attempted to impose differing terms on the purchase of goods. Tippins, a
Pittsburgh company then engaged in the construction of a steel rolling mill in the
Czech Republic, sought to purchase gear drive assemblies from Flender Corporation
for installation at the new facility. In January 1998, Tippins mailed a purchase order
to Flender specifying terms of sale. The order limited the form in which Flender could
acknowledge and accept Tippins’s offer and required that the parties’ disputes under
any resulting contract be submitted to arbitration. The order stated Tippins’s terms
as follows: “Tippins[’s] purchase order is expressly limited to acceptance of ‘Standard
General Conditions Nova Hut Purchase Order’ and special conditions of purchase,
which take precedence over any terms and conditions written on the back of the
purchase order.” The “Standard General Conditions Nova Hut Purchase Order”
included the arbitration clause at issue here, requiring that all claims or disputes
arising out of the contract must be submitted to arbitration before the International
Chamber of Commerce in Vienna, Austria, and would be governed by Austrian law.
Moreover, the order limited the form of Flender’s acceptance as follows:
AS PART OF THIS OFFER TO PURCHASE GOODS OR SERVICES THE
ATTACHED ACKNOWLEDGMENT FORM OF THE PURCHASE ORDER “MUST”
BE SIGNED AND RETURNED.... [NEITHER] TIPPINS NOR ANY OF ITS
AFFILIATES RECOGNIZES ANY OTHER DOCUMENT AS AN
ACKNOWLEDGMENT.
Flender did not sign the attached acknowledgment form or issue any other
written acceptance of Tippins’s offer, but instead manufactured and shipped the
finished drive assemblies. Flender’s invoice, which accompanied the drive assemblies,
provided “Conditions of Sale and Delivery” that attached conditions to Flender’s
acceptance of Tippins’s order. Flender’s conditions provided as follows:
[T]hese terms and conditions will govern all quotations covering purchase orders
for and sales of Seller’s products and are the sole terms and conditions on which
the order of buyer will be accepted. Seller’s acceptance of Buyer’s order will not
constitute an acceptance of printed provisions on Buyer’s order form which are
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210 CHAPTER IV: ALTERNATIVE REGIMES