Wednesday, December 25, 2013

Richardson v. Union Carbide Industrial Gases, Inc. case brief

Richardson v. Union Carbide Industrial Gases, Inc. case brief summary
790 A.2d 962 (N.J.Super. 2002)

Plaintiff employee sued defendant/cross-claim defendant buyer, defendant/cross-claim plaintiff seller, and others, alleging, inter alia, negligence related to a furnace that exploded. The seller cross-claimed against the buyer for contractual indemnification. The Superior Court of New Jersey, Law Division, Burlington County, granted the buyer summary judgment on the indemnification claim and dismissed that claim. The seller appealed.

The buyer had purchased from the seller various systems and parts for the furnace that later exploded. The seller's written proposals or offers for the items and the buyer's subsequent purchase orders accepting the items contained conflicting indemnification provisions. The seller argued on appeal that the trial court erred in implicitly applying the "knock-out" rule to find that the contract did not include the seller's indemnity provision, and in analyzing the case under N.J. Stat. Ann. § 12A:2-207(3) of the Uniform Commercial Code (UCC), N.J. Stat. Ann. §§ 12A:1-101to 11-108, instead of N.J. Stat. Ann. § 12A:2-207(2) of the UCC.


  • The appellate court adopted the "knock-out" rule for conflicting terms in contracts governed by the UCC. 
  • Applying that rule to the contract at issue, the conflicting terms did not become part of the contract, which instead consisted of the terms on which the parties' writings agreed, together with any supplementary terms incorporated under any other provisions of the UCC, as per § 12A:2-207(3). 
  • Furthermore, the result would have been the same even under a § 12A:2-207(2) analysis. Thus, the buyer was properly granted summary judgment.
The appellate court affirmed the summary judgment that was granted to the buyer, dismissing the seller's cross-claim for indemnification.

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