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Law School Case Brief

Steiner v. Mobil Oil Corp - 20 Cal. 3d 90, 141 Cal. Rptr. 157, 569 P.2d 751 (1977)

Rule:

Cal. Com. Code § 2207(1) provides that parties may form an agreement, even if the terms of offer and acceptance do not entirely converge, if the offeree gives a definite expression of acceptance and if the terms of acceptance do not explicitly condition agreement upon the offeror's consent to the offeree's new proposed terms.

Facts:

Plaintiff service station operator filed an action for declaratory and monetary relief to prohibit defendant from imposing a contractual term that plaintiff expressly rejected in his offer. Under their retail dealer contract, the defendant was to supply the downpayment for plaintiff to purchase his station, and, in exchange, plaintiff was to purchase all gasoline from defendant for 10 years. The defendant was to provide guaranteed competitive allowance reducing its price by 1.4 cents per gallon but the latter subsequently reduced the competitive allowance. The trial court found for plaintiff. Defendant appealed.

Issue:

Is the retail dealer contract between the parties subject the condition of the defendant corporation to reduce the competitive allowance?

Answer:

No.

Conclusion:

The court affirmed  and held that the defendant corporation did not condition its acceptance of plaintiff's offer on plaintiff's agreement to alter a term of the offer; thus a contract was formed. Additionally, defendant's alteration did not become part of the contract because plaintiff's offer expressly limited acceptance to its terms. The court held that defendant's acceptance was not expressly conditional on plaintiff's assent to remove the guaranteed allowance.

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