978-0078023859 Case8_2

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Case 8.2
GOTTLIEB & CO., INC. V. ALPS SOUTH CORPORATION
Court of Appeals of Florida
985 So. 2d 1; 33 Fla. L. Weekly D 46; 2007 Fla. App. LEXIS 20245 [December 21, 2007]
FACTS:
Gottlieb is a fabric converter based in New York City. They supply customers with specialty knitted
fabrics that are shipped directly from third-party knitting and finishing mills.
Alps is a manufacturer of medical devices located in St. Petersburg, Florida that produces various
types of liners that amputees use to attach prosthetic devices.
In its finished goods form provided in response to Alpo’s order, Gottlieb limited its liability to
exclude consequential damages.
During the course of the parties’ relationship, Gottlieb substituted the yarn used in making fabric
which resulted in complaints from Alps’ customers and caused Alps to suffer economic loss.
To obtain compensation, Alps requested consequential damages from Gottlieb related to the
customer complaints; Gottlieb claimed that its finished goods form excluded such liability.
PROCEDURE: The Circuit Court for Pinellas County Florida awarded $28,846.29 for the seller as
damages and awarded $694,640.04 to the buyer for damages and ruled that a limitation of liability
clause in the parties’ contract was unenforceable.
ISSUE: Did the limitation on consequential damages become part of the parties’ final contract or did it
materially alter the terms of the contract?
DECISION: Yes, the limitations on consequential damages became part of the contract. No, it was not
RULE: “Florida Code Section 677.207(1), provides that, between merchants, where a ‘definite and
seasonable expression of acceptance or a written confirmation is sent within a reasonable time, ‘it
operates as ‘an acceptance even though it states terms additional to or different from those offered or
agreed upon, unless acceptance is expressly made conditional on assent to the additional or different
terms.” Section 677.207(2) states that “the additional terms are to be construed as proposals for
addition to the contract. Between merchants such terms become part of the contract unless: (a) the
offer expressly limits acceptance to the terms of the offer, (b) they materially alter it, or (c) notification
of objection to them has already been given or is given within a reasonable time after notice of them is
received.“
REASONING:
1. Because the finished goods contract at issue was the 6th in a series between the two parties and
each contract included the limitations of liability term, it is not a surprise.
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2. Alps argued that it was a ‘surprise’ because they had not read the contract before the dispute.
However, Florida law has never excused a party from a contract simply for failing to read it.
3. Alps neglected to inform Gottlieb of the larger consequences of the breach so the court concluded
that Alps could not maintain that incorporating the limitation of liability clause would result in a
severe economic hardship.
ADDITIONAL INFORMATION:
Note, the rules of engagement for the ‘battle of the forms’ are the same under UCC 2-207.
In determining whether a term constitutes a material alteration, courts have placed the burden of

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