Wednesday, December 4, 2013

Union Carbide Corp. v. Oscar Mayer Foods Corp. case brief

Union Carbide Corp. v. Oscar Mayer Foods Corp. case brief summary
947 F.2d 1333 (1991)


CASE SYNOPSIS
Plaintiff taxpayer corporation appealed an order the United States District Court for the Northern District of Illinois, which granted summary judgment for defendant customer corporation in plaintiff's breach of contract action.

CASE FACTS
Plaintiff taxpayer corporation filed a diversity action against defendant customer corporation for breach of contract to recover sales tax it had paid on products it had sold to defendant. Plaintiff claimed that defendant had agreed to indemnify it for all sales tax liability. The district court granted defendant's motion for summary judgment.

DISCUSSION

  • On appeal, the court affirmed the summary judgment because plaintiff's misreading of the contract was clear enough to have been determined without a trial. 
  • There was no breach of contract because the indemnity clause on the back of the invoice was a material alteration in the parties' contract and was therefore unenforceable where the clause was ambiguous and defendant's consent could not be realistically inferred by its silence in the face of a succession of invoices containing the new term.

CONCLUSION
The court affirmed the district court's order granting summary judgment for defendant customer corporation, and held that there was no breach of contract because the indemnity clause on the back of the invoice materially altered the parties' contract and plaintiff taxpayer corporation could not infer consent to the alteration by defendant's silence.

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