Klocek v. Gateway Arbitration Quiz
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Questions and Answers

What did Gateway, Inc. argue regarding the arbitration clause?

  • That the arbitration clause was irrelevant to the case.
  • That it was included in a verbal agreement.
  • That it was part of the Standard Terms that governed the dispute. (correct)
  • That Plaintiff rejected all terms and conditions.

    • The plaintiff, William S. Klocek, agreed to the arbitration clause by returning the computer within five days.

    False

    What was the primary legal issue in the Klocek v. Gateway case?

    Whether the arbitration clause became part of the contract.

    Under U.C.C. § 2–207, additional terms in an acceptance require __________ to become part of the contract.

    <p>express assent</p> Signup and view all the answers

    Match the terms to their descriptions:

    <p>Arbitration Clause = Dispute resolution method Standard Terms = Document accompanying product U.C.C. § 2–204 = General principles for contract formation U.C.C. § 2–207 = Handling additional terms in contracts</p> Signup and view all the answers

    What was included in the multi-page 'Standard Terms and Conditions' document?

    <p>An arbitration clause.</p> Signup and view all the answers

    The United States District Court for the District of Kansas ruled on the arbitration clause in 2000.

    <p>True</p> Signup and view all the answers

    What document accompanied the Gateway computer that contained the arbitration clause?

    <p>Standard Terms and Conditions</p> Signup and view all the answers

    What did the court require Gateway to establish for arbitration?

    <p>An enforceable agreement to arbitrate</p> Signup and view all the answers

    The mere act of keeping the computer for more than five days was considered sufficient to show express agreement to arbitration terms.

    <p>False</p> Signup and view all the answers

    What did the District Court conclude about the Standard Terms?

    <p>They were proposed after the contract was formed.</p> Signup and view all the answers

    Klocek v. Gateway highlights the protection of __________ in consumer transactions under U.C.C. § 2–207.

    <p>consumers</p> Signup and view all the answers

    Match the following terms with their descriptions:

    <p>Arbitration Clause = Provision that allows disputes to be resolved outside of court U.C.C. § 2–207 = Governs the effect of additional or different terms in contracts Express Agreement = Clear and unequivocal consent to a contract's terms Shrinkwrap Agreement = Terms included inside packaging of a product</p> Signup and view all the answers

    Which case did the Kansas court find unpersuasive regarding in-the-box terms?

    <p>Hill v. Gateway 2000</p> Signup and view all the answers

    The court ruled that an arbitration clause existed in the Gateway case.

    <p>False</p> Signup and view all the answers

    What shifted the burden of proof after Gateway showed evidence of an agreement?

    <p>It shifted to the plaintiff to demonstrate a genuine issue for trial.</p> Signup and view all the answers

    The act of keeping the computer beyond five days was deemed __________ for showing express agreement.

    <p>insufficient</p> Signup and view all the answers

    Match the court's rulings or statements with their significance:

    <p>Gateway's Burden = Must establish enforceability of arbitration Kansas Court's Rejection = Highlight differences in jurisdictional approaches Express Agreement Requirement = Affirmative assent needed for additional terms In-the-box Terms = Not enforceable without consumer agreement</p> Signup and view all the answers

    What does the Klocek case reiterate regarding consumer transactions?

    <p>Express agreement is necessary for added terms to apply</p> Signup and view all the answers

    The court agreed with the Seventh Circuit's decision in Hill v. Gateway 2000.

    <p>False</p> Signup and view all the answers

    What did the court find unpersuasive regarding the Seventh Circuit's conclusion about UCC § 2–207?

    <p>That it was irrelevant in one-form cases.</p> Signup and view all the answers

    What was the primary legal issue in the dispute between Jordan and Itoh?

    <p>Whether there was a valid agreement for arbitration</p> Signup and view all the answers

    Jordan's acknowledgment form was unconditional and did not specify buyer assent.

    <p>False</p> Signup and view all the answers

    What did the Seventh Circuit ultimately rule regarding the arbitration clause?

    <p>The arbitration clause was not part of the contract.</p> Signup and view all the answers

    The arbitration provision required disputes to be submitted in __________________.

    <p>New York City</p> Signup and view all the answers

    What does U.C.C. § 2–207(1) state about acceptance?

    <p>A contract can still form even with different terms if not expressly conditional.</p> Signup and view all the answers

    Section 2–207(3) allows terms in a contract to be formed by conduct even if the writings do not match.

    <p>True</p> Signup and view all the answers

    What provision did Jordan include in its acknowledgment form relating to additional terms?

    <p>Expressly conditional on Buyer’s assent.</p> Signup and view all the answers

    The standard for arbitration under the provisions was based on the rules of the _________________.

    <p>American Arbitration Association</p> Signup and view all the answers

    What was the district court's primary reason for denying Jordan’s motion for a stay pending arbitration?

    <p>Certain issues wouldn't be resolved by arbitration.</p> Signup and view all the answers

    Match the terms with their correct definitions regarding contract formation:

    <p>U.C.C. § 2–207(1) = Provision for conditional acceptance U.C.C. § 2–207(3) = Formation of contract by conduct American Arbitration Association = Body administering arbitration rules Arbitration Clause = Agreement to resolve disputes outside of court</p> Signup and view all the answers

    What was Itoh's action in response to Jordan's acknowledgment regarding the arbitration term?

    <p>Itoh neither expressly assented nor objected.</p> Signup and view all the answers

    The court found that arbitration could be considered a gap-filler under U.C.C.

    <p>False</p> Signup and view all the answers

    The dispute arose when Itoh alleged the coils were ____________ and delivered late.

    <p>defective</p> Signup and view all the answers

    What was one of the risks for sellers who use an 'expressly conditional' clause?

    <p>They risk conflicting terms dropping out under the U.C.C.</p> Signup and view all the answers

    What prevents a contract from arising under § 2–207(1)?

    <p>Acceptance is subject to additional terms</p> Signup and view all the answers

    Arbitration clauses are standard 'gap-fillers' under the U.C.C.

    <p>False</p> Signup and view all the answers

    What did the plaintiff, Livingstone, counteroffer for the land?

    <p>$1,600</p> Signup and view all the answers

    The original offer from Evans was for _____ dollars.

    <p>1,800</p> Signup and view all the answers

    What was the key question regarding Evans's telegram stating 'Cannot reduce price'?

    <p>If it was a revival of the original offer</p> Signup and view all the answers

    The trial court initially ruled in favor of the defendant.

    <p>False</p> Signup and view all the answers

    What did the Alberta Supreme Court ultimately order the defendant to do?

    <p>Convey the land for $1,800</p> Signup and view all the answers

    If an offer has been rejected, it _____ be accepted without the consent of the offeror.

    <p>cannot</p> Signup and view all the answers

    What did the defendant argue regarding the counteroffer?

    <p>It terminated the original offer</p> Signup and view all the answers

    The defendant was found to have effectively reinstated the original offer.

    <p>True</p> Signup and view all the answers

    What was the total ruling amount for the land in the case of Livingstone v. Evans?

    <p>$1,800</p> Signup and view all the answers

    Justice Walsh believed the defendant's statement indicated he was still _____ by the original offer.

    <p>standing</p> Signup and view all the answers

    Match the parties with their roles in the cases:

    <p>Livingstone = Plaintiff seeking specific performance Evans = Defendant who offered land for sale Minneapolis &amp; St. Louis Railway = Buyer in breach of contract case Columbus Rolling-Mill Co. = Seller sued for performance</p> Signup and view all the answers

    What did the Plaintiff offer to accept in their telegram?

    <p>Fifty-eight cents per barrel</p> Signup and view all the answers

    What was the result of the Supreme Court's ruling in this case?

    <p>No contract was formed due to the counteroffer</p> Signup and view all the answers

    The Buyer’s counteroffer for 1,200 tons constituted an acceptance of the Seller's original offer.

    <p>False</p> Signup and view all the answers

    The Defendant's acceptance of the offer was made on July 31.

    <p>False</p> Signup and view all the answers

    What was the primary reason the court found the acceptance too late?

    <p>Market fluctuations.</p> Signup and view all the answers

    What quantity did the Buyer attempt to order originally?

    <p>1,200 tons</p> Signup and view all the answers

    A proposal to accept ... upon terms varying from those offered is a rejection of the offer.

    <p>or an acceptance</p> Signup and view all the answers

    The Plaintiff’s offer was sent on July 31 and delivered on __________.

    <p>August 2</p> Signup and view all the answers

    Which of the following was a key factor in the Supreme Court's reasoning?

    <p>The Buyer's counteroffer extinguished the original offer</p> Signup and view all the answers

    Match the following dates with their corresponding events:

    <p>July 30 = Defendant wired an initial offer July 31 = Plaintiff replied to the offer August 2 = Plaintiff's telegram was delivered August 3 = Defendant accepted the offer</p> Signup and view all the answers

    What did the court conclude regarding the contract?

    <p>No binding contract was formed.</p> Signup and view all the answers

    What did the Seller state in their telegram rejecting the Buyer's counteroffer?

    <p>We cannot book your order at present at that price.</p> Signup and view all the answers

    The Seller renewed the original offer after rejecting the Buyer's counteroffer.

    <p>False</p> Signup and view all the answers

    The court stated that telegraphic contracts adhere to different rules than those sent via mail.

    <p>False</p> Signup and view all the answers

    What did the market price of oil fluctuate between during the relevant period?

    <p>$0.55 and $0.75</p> Signup and view all the answers

    Once the original offer is terminated, it cannot be revived unless the _______ assents to such revival.

    <p>offeror</p> Signup and view all the answers

    Match the following terms with their correct meanings:

    <p>Counteroffer = A response to an offer that changes its terms Acceptance = Agreement to the terms of an offer Termination = The end of an offer's validity Revocation = Withdrawal of an offer before acceptance</p> Signup and view all the answers

    The Defendant’s acceptance attempted to bind the Plaintiff at __________ cents per barrel.

    <p>58</p> Signup and view all the answers

    Which factor played a significant role in determining the 'reasonable time' for acceptance?

    <p>Fluctuations in the market</p> Signup and view all the answers

    How did the court view the Buyer's telegram on December 19th?

    <p>As an ineffective attempt to recreate the original offer</p> Signup and view all the answers

    What was the minimum quantity specified in the Seller's original offer?

    <p>2,000 tons</p> Signup and view all the answers

    The Buyer was able to create rights against the Seller after attempting to accept the original offer.

    <p>False</p> Signup and view all the answers

    Once an offer is rejected, it leaves the matter as if ... offer had ever been made.

    <p>no</p> Signup and view all the answers

    Which principle did the Court cite regarding offers?

    <p>An offer imposes no obligation until accepted</p> Signup and view all the answers

    What was the main reason the Court of Appeal dismissed Dickinson's appeal?

    <p>Dodds effectively revoked the offer before acceptance.</p> Signup and view all the answers

    Dickinson had received an acknowledgment of his acceptance before Dodds sold the property to Allan.

    <p>False</p> Signup and view all the answers

    What is a 'nudum pactum' as described in the ruling?

    <p>A promise that is not binding due to lack of consideration.</p> Signup and view all the answers

    The original price offered for the property was __________.

    <p>£800</p> Signup and view all the answers

    Match the following individuals with their roles in the case.

    <p>Dodds = Defendant who sold the property Dickinson = Plaintiff seeking specific performance Thomas Allan = Third-party purchaser Mr. Berry = Agent who informed Dickinson</p> Signup and view all the answers

    What was the amount Petterson was offered to reduce his mortgage debt?

    <p>$700</p> Signup and view all the answers

    Why did Dodds argue that Dickinson's acceptance was invalid?

    <p>Both B and C.</p> Signup and view all the answers

    The defendant successfully accepted Petterson's reduced payment before selling the mortgage.

    <p>False</p> Signup and view all the answers

    The Court of Appeal found that Dickinson was unaware of Dodds' sale to Allan before attempting to accept the offer.

    <p>False</p> Signup and view all the answers

    Which clause did the court emphasize was not binding in Dodds's memorandum?

    <p>The promise to keep the offer open until Friday 9 AM.</p> Signup and view all the answers

    What was Petterson's intention when he visited the defendant?

    <p>To tender full payment of the reduced balance.</p> Signup and view all the answers

    The court held that the defendant's revocation of the offer was legal because Petterson had not completed the _______.

    <p>payment</p> Signup and view all the answers

    The date Dodds sent the initial memorandum of offer was __________.

    <p>June 10, 1874</p> Signup and view all the answers

    Match the following events with their corresponding dates.

    <p>Initial memorandum signed = June 10, 1874 Sale to Thomas Allan = June 11, 1874 Dickinson's second acceptance attempt = June 12, 1874 Court of Appeal decision = Date unspecified</p> Signup and view all the answers

    Which principle did the majority opinion emphasize regarding unilateral contracts?

    <p>An offer may be revoked before the requested act is performed.</p> Signup and view all the answers

    What concept is illustrated by Dickinson knowing Dodds sold the property to Allan, yet trying to accept the offer?

    <p>Lack of a meeting of the minds</p> Signup and view all the answers

    A binding contract arose after Dodds learned of Dickinson's acceptance.

    <p>False</p> Signup and view all the answers

    The dissenting opinion argued that Petterson's attempt to pay constituted the performance of the requested act.

    <p>True</p> Signup and view all the answers

    What was the outcome of the Court of Appeals' ruling regarding Petterson's claim?

    <p>The court reversed the judgment for Petterson and dismissed the complaint.</p> Signup and view all the answers

    What did the court conclude regarding the status of the contract upon Dickinson's learning of the sale?

    <p>It was too late for Dickinson to accept the offer.</p> Signup and view all the answers

    According to the ruling, the defendant revoked his offer by stating he had _______ the mortgage.

    <p>sold</p> Signup and view all the answers

    Dodds received a deposit of __________ for the sale to Allan.

    <p>£40</p> Signup and view all the answers

    What did Judge Lehman argue regarding the revocation of the offer?

    <p>It was unfair to Petterson.</p> Signup and view all the answers

    The defendant was required to accept Petterson’s payment regardless of the mortgage sale.

    <p>False</p> Signup and view all the answers

    What monetary amount did Petterson seek to recover in his lawsuit?

    <p>$780</p> Signup and view all the answers

    The court's majority opinion emphasized that without ______, no binding promise was made.

    <p>tender of payment</p> Signup and view all the answers

    Which justice wrote the dissenting opinion in this case?

    <p>Lehman, J.</p> Signup and view all the answers

    What type of contract was proposed by the defendant's letter?

    <p>Unilateral contract</p> Signup and view all the answers

    Petterson was able to successfully make the payment before the defendant revoked the offer.

    <p>False</p> Signup and view all the answers

    What was the amount Petterson was seeking to recover from the defendant?

    <p>$780</p> Signup and view all the answers

    Petterson attempted to pay off the mortgage before ______.

    <p>May 31</p> Signup and view all the answers

    Match the following actions with the corresponding outcomes:

    <p>Defendant's revocation = No contract formed Petterson's attempt to pay = Performance of an act Selling the mortgage = Invalidated Petterson's offer Judicial ruling in trial court = Awarded Petterson $780</p> Signup and view all the answers

    According to the majority, what justified the defendant's revocation of the offer?

    <p>The mortgage was sold to a third party</p> Signup and view all the answers

    The dissenting opinion agreed with the majority's view on the unilateral contract.

    <p>False</p> Signup and view all the answers

    What fundamental principle did Judge Lehman emphasize regarding performance?

    <p>Preventing performance</p> Signup and view all the answers

    The balance on Petterson's mortgage principal was ______.

    <p>$5,450</p> Signup and view all the answers

    What did the majority opinion conclude about the existence of a contract?

    <p>No contract was ever made</p> Signup and view all the answers

    The trial court ruled in favor of the defendant.

    <p>False</p> Signup and view all the answers

    What act was requested by the defendant to accept the offer?

    <p>Payment in full of the reduced principal</p> Signup and view all the answers

    Under the classic rule for a unilateral contract, an offer may be withdrawn before ______.

    <p>the act requested has been performed</p> Signup and view all the answers

    Match the parties involved with their roles:

    <p>Petterson = Plaintiff Pattberg = Defendant Court of Appeals = Appellate Authority Trial Court = Initial Ruling</p> Signup and view all the answers

    What did Judge Lehman argue about the defendant's ability to revoke the offer?

    <p>It was not justified as Petterson was ready to perform</p> Signup and view all the answers

    Study Notes

    Case Summaries

    • Klocek v. Gateway, Inc.: Dispute over arbitration clause in computer purchase terms. Plaintiff argued he hadn't expressly agreed to the terms. Court ruled that Gateway needed to prove express assent; the "in the box" terms weren't automatically part of the contract. Decision countered the Seventh Circuit's more lenient view in similar cases.

    Case Summaries

    • C. Itoh & Co. (America) Inc. v. Jordan International Co.: A "battle of the forms" case concerning a sale of steel coils. Jordan's acknowledgment form made acceptance conditional upon assent to terms; Itoh didn't expressly assent to arbitration—critical detail! The Court found that the contract formed by conduct (delivery of coils). That contract excluded the arbitration provision because it wasn't agreed to in the written exchanges.

    Case Summary

    • Livingstone v. Evans: Land sale dispute settled via telegrams. Livingstone's counteroffer seemed to end the deal, but the defendant's "Cannot reduce price" message was interpreted as reviving the initial offer. This enabled Livingstone's later acceptance, creating a binding contract.

    Case Summary

    • Minneapolis & St. Louis Railway v. Columbus Rolling-Mill Co.: Dispute over an alleged contract for steel rails. Buyer initially countered the offer, then tried to accept the original terms as if the prior rejection didn't matter. Court held this was a new offer, not a contract. Counteroffers terminate original offers.

    Case Summary

    • Petterson v. Pattberg: Unilateral contract dispute, involving repayment of a mortgage. Defendant revoked an offer to reduce a mortgage payment before Petterson tendered payment. Majority held revocation was valid; dissent argued defendant's actions prevented performance.

    Case Summary

    • Dickinson v. Dodds: Land sale disagreement. Dodds offered to sell a property but revoked it by selling to another party before Dickinson accepted. The court determined the written memorandum was not a binding contract. Actual knowledge of the sale effectively revoked the offer

    Case Summary

    • Minnesota Linseed Oil Co. v. Collier White Lead Co.: Contract via telegraph involving linseed oil for the duration of August 1875. Defendant's acceptance was deemed too late, considering the volatile market fluctuations. Late acceptance is not valid if the original offer is terminated or withdrawn.

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