In the instant case, there is no dispute as to the material
facts. The central question before the court is whether the
agreement between the parties for the purchase of the coating
machine was governed by the terms of Mercer's original
quotation or by the terms of Technographics' subsequent
purchase order. As in many cases dealing with the sale of
goods, and consequently the Uniform Commercial Code
("U.C.C."), both the original quotation and the purchase order
contain a plethora of boiler plate language intended to
protect the parties in the event of a dispute. Also, as in
many cases dealing with the U.C.C., the language contained in
each form is essentially contradictory.
Mercer's original quotation specifically negates implied
warranties of purpose and merchantability and claims for
consequential damages. It also provides that the terms of the
quotation may only be altered by a written instrument signed
by an officer of the Mercer Corporation. Contrastingly,
Technographics' subsequent purchase order creates implied
warranties of purpose and merchantability and does not negate
Mercer contends that the agreement between the parties is
governed by the terms of the original quotation. It argues
that under the U.C.C. the additional and different terms of
the subsequent purchase order never became part of the
contract between the parties. See 13 Pa. C.S.A. § 2207
(subsequent additional terms are to be construed only as
proposals for addition to the contract if: 1) the offer
expressly limits acceptance to the terms of the offer; or 2)
the additional terms material alter the contract); Universal
Plumbing and Piping Supply, Inc. v. John C. Grimberg Company,
Inc., 596 F. Supp. 1383 (W.D.Pa. 1984) (an arbitration provision
on the back of a purchase order was an offer of an additional
term and did not become part of the contract because the
original offer expressly restricted acceptance to its terms and
also because the additional term materially altered the
contract). However, this would only be true if Technographics'
actions following the receipt of Mercer's original quotation
formed a contract between the parties. Unfortunately for
Mercer, it took one too many steps in its efforts to protect
The original quotation, dated October 15, 1987, provides in
part, "[i]t is understood and agreed that the contract between
the Buyer and the Company was made in Hendersonville, Sumner
County, Tennessee, upon acceptance by the Company, Mercer
Corporation and by its properly authorized representatives."
This is known as a home office acceptance clause. Such a
clause precludes the formation of a contract except upon
approval by the relevant home office. West Penn Power Co. v.
Bethlehem Steel Corp., 236 Pa. Super. 413, 426-27, 348 A.2d 144,
152 (1975). Thus, the inclusion of this home office acceptance
clause was intended to and did, in fact, make it impossible for
Technographics to create a binding contract by accepting
Mercer's quotation. In addition, the inclusion of this clause
converts what would have otherwise been an offer into a
proposal or preliminary negotiation. Id. at 427 n. 7, 348 A.2d
at 152 n. 7.
Since the quotation was not an offer, Technographics'
subsequent purchase order constituted the first offer between
the parties. McCarty v. Verson Allsteel Press Co., 89 Ill. App.3d 498,
507, 44 Ill.Dec. 570, 577, 411 N.E.2d 936, 943
(1980) (since acceptance of a price quotation containing a home
office acceptance clause cannot create an enforceable contract,
the subsequent purchase order should be treated as the offer).
Significantly, subsequent to its receipt of the purchase order
and without notifying Technographics of any objection to the
terms of the purchase order, Mercer designed, delivered and
installed the coating machine. These actions constitute
acceptance by Mercer of the terms contained in Technographics'
purchase order. 13 Pa. C.S.A. § 2207(c). Accordingly, the
terms, including all waivers and disclaimers, contained in
Mercer's original quotation have no legal effect on the
Mercer contends further that under Pennsylvania law
Technographics is not entitled to recover lost profits as part
of its claimed consequential damages. Mercer maintains that
Pennsylvania law precludes the recovery of lost profits for
breach of warranty unless the goods were purchased for resale
to the general public. However, this is a misstatement of
Pennsylvania law. Although Pennsylvania law precludes recovery
of loss of profits to a business because of customer
dissatisfaction or loss of goodwill, it does not limit such
recovery solely to cases involving goods purchased for resale.
See, e.g. Draft Systems, Inc. v. Rimar Manufacturing, Inc.,
524 F. Supp. 1049 (E.D.Pa. 1981) (goods provided to manufacturer
were used in manufacturing process); Frank B. Bozzo, Inc. v.
Electric Weld Division, 283 Pa. Super. 35, 423 A.2d 702 (1980)
(steel mesh used in concrete paving on a highway); R.I. Lampus
Co. v. Neville Cement Products Corp., 474 Pa. 199, 378 A.2d 288
(1977) (cement blocks used in manufacture of structural
planks). Recovery of lost profits will be permitted if such
damages are proven with reasonable certainty. National Controls
Corp. v. National Semiconductor Corp., 833 F.2d 491 (3d Cir.
1987) (buyer failed to prove that seller's breaches were
proximate cause of alleged loss of profits on sale of
telephones to third parties).
Finally, Mercer argues that Technographics' claims based on
strict liability and negligence should be dismissed because
Pennsylvania does not recognize recovery for economic loss
under these theories. Lower Lake Dock Company v. Messinger
Bearing Corp., 395 Pa. Super. 456, 461-65, 577 A.2d 631, 634-36
(1990); New York State Electric & Gas Corp. v. Westinghouse
Electric Corp., 387 Pa. Super. 537, 550-51, 564 A.2d 919, 925-26
(1989); REM Coal Co., Inc. v. Clark Equipment Co.,
386 Pa. Super. 401, 563 A.2d 128 (1989). The court agrees and will
grant summary judgment in favor of Mercer on these two claims.
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