This case brief covers UCC § 2-207 battle of the forms case holding that an indemnity clause in a seller’s acknowledgment did not become part of the contract.
Brown Machine v. Hercules is a staple in first-year Contracts courses for its clear illustration of the Uniform Commercial Code’s approach to the battle of the forms under § 2-207. It addresses a common commercial reality: buyers and sellers exchange forms with conflicting boilerplate, yet proceed with performance. The question is which terms, if any, control—especially when one side attempts to add a significant term like an indemnity provision.
The decision is especially important because it walks through the sequential analysis under § 2-207: identifying the offer, determining whether the purported acceptance was "expressly conditional" (making it a counteroffer), deciding whether the contract is instead formed by conduct under § 2-207(3), and assessing whether a contested term would materially alter the contract under § 2-207(2). For students, Brown Machine provides a roadmap for analyzing form exchanges and highlights drafting choices that can make or break the inclusion of high-stakes terms.
Brown Machine, Inc. v. Hercules, Inc., 770 S.W.2d 416 (Mo. Ct. App. E.D. 1989)
Brown Machine, Inc. (seller) manufactured and sold a trim press to Hercules, Inc. (buyer). Brown first sent a price quotation that included its standard terms and conditions on the reverse, one of which required the buyer to indemnify Brown for claims arising from the use of the machine. Hercules did not accept the quotation as such; instead, Hercules issued its own purchase order to buy the machine. The purchase order contained terms favorable to Hercules and, as is common, limited acceptance to the terms stated in the order and rejected additional or different terms unless expressly assented to in writing by Hercules. Brown then sent an order acknowledgment that purported to accept the purchase order but stated on its face that acceptance was "expressly conditional" on the buyer’s assent to the seller’s terms on the reverse, which again included the indemnity clause. The parties proceeded with performance: Brown shipped the machine, Hercules accepted delivery and paid. Later, a Hercules employee was injured while using the trim press and sued Brown. Brown sought contractual indemnity from Hercules based on the indemnity language in Brown’s acknowledgment. Hercules refused, arguing that the indemnity term never became part of the parties’ contract. Brown sued to enforce the indemnity; the trial court ruled for Hercules, and Brown appealed.
Did the indemnity clause contained in the seller’s acknowledgment become part of the contract between Brown Machine and Hercules under UCC § 2-207, such that Hercules was obligated to indemnify Brown for the personal injury claim?
Under UCC § 2-207(1), a definite and seasonable expression of acceptance operates as an acceptance even though it states terms additional to or different from those offered, unless acceptance is expressly made conditional on assent to the additional or different terms. If the acceptance is expressly conditional, it operates as a counteroffer, not an acceptance. Under § 2-207(2), as between merchants, additional terms in an acceptance become part of the contract unless (a) the offer expressly limits acceptance to its terms, (b) the additional terms materially alter the contract, or (c) notification of objection has already been given or is given within a reasonable time. If the writings do not establish a contract because the purported acceptance was expressly conditional, but the parties proceed with performance, § 2-207(3) provides that a contract is formed by conduct, and its terms consist of those on which the writings agree, together with UCC gap-fillers; conflicting or additional terms not agreed upon are excluded.
No. The indemnity clause did not become part of the contract. Brown’s acknowledgment was expressly conditional and therefore a counteroffer; the contract, formed by conduct under § 2-207(3), consisted only of agreed terms, which did not include indemnity. Alternatively, even if the acknowledgment were treated as an acceptance, the indemnity provision constituted a material alteration and was rejected by the buyer’s limiting language, so it would not have become part of the contract under § 2-207(2).
The court first identified the operative offer. Brown’s initial price quotation was merely a solicitation and not an offer. Hercules’ subsequent purchase order was the offer, and it expressly limited acceptance to its own terms and rejected additional or different terms absent Hercules’ express assent. Brown’s order acknowledgment, although styled as an acceptance, stated that Brown’s acceptance was "expressly conditional" on Hercules’ assent to Brown’s terms, including indemnity. Under § 2-207(1), that language prevents the acknowledgment from operating as an acceptance; it is instead a counteroffer that required Hercules’ express assent. Hercules never expressly assented to the indemnity term or to being bound by Brown’s terms, and there was no signature or written acceptance of the indemnity. Nonetheless, both parties proceeded with performance—Brown delivered the machine and Hercules paid—creating a contract by conduct under § 2-207(3). In such cases, the contract’s terms are limited to those on which the writings agree; disputed terms like indemnity are excluded and replaced, if necessary, by UCC gap-fillers. Because the writings did not agree on indemnity, that provision was not part of the contract. The court added that, even if the acknowledgment had not been expressly conditional and thus functioned as a § 2-207(1) acceptance, the indemnity clause would not have become part of the contract under § 2-207(2). The purchase order expressly limited acceptance to its terms and objected to additional terms; either condition independently prevents incorporation of additional terms. Moreover, an indemnity clause of this nature is a material alteration because it imposes substantial, unexpected liability on the buyer, creating surprise or hardship if incorporated without express awareness. As a result, the indemnity term would be excluded under § 2-207(2)(a) and (b). Accordingly, under any path of analysis—counteroffer with § 2-207(3) or acceptance with § 2-207(2)—Brown’s indemnity clause never bound Hercules.
Brown Machine is a leading illustration of how § 2-207 works in practice. It teaches students to (1) identify the offer and the purported acceptance, (2) scrutinize whether the acceptance is "expressly conditional," (3) consider whether a contract is formed by conduct under § 2-207(3), and (4) evaluate whether a contested term would be a material alteration under § 2-207(2). It also underscores that powerful boilerplate (like indemnity) rarely slips into a contract absent unmistakable assent and that buyer forms limiting acceptance are potent shields. For drafting and exam purposes, the case highlights the importance of clear conditional language, consistent objection to additional terms, and awareness that performance can create a contract whose terms are only those actually agreed upon.
The acknowledgment stated that acceptance was "expressly conditional" on the buyer’s assent to the seller’s terms on the reverse, including the indemnity clause. Under UCC § 2-207(1), such an expressly conditional response is not an acceptance but a counteroffer that requires express assent by the original offeror. Hercules never expressly assented.
UCC § 2-207(3) provides that a contract can be formed by the parties’ conduct even if their writings do not establish a contract. Here, Brown shipped the machine and Hercules accepted and paid. That conduct created a contract. The terms of that contract are limited to those on which the writings agree, with UCC gap-fillers supplying the rest; contested terms like indemnity are excluded.
No. Even treating the acknowledgment as a § 2-207(1) acceptance, the indemnity clause is an additional term that would become part between merchants only if it does not fall within § 2-207(2)’s exceptions. Here, (a) the purchase order expressly limited acceptance to its terms and rejected additional terms, and (b) an indemnity clause is a material alteration because it imposes significant, unexpected liability—thus it would not automatically be included.
Material alterations are terms that would result in surprise or hardship if incorporated without express awareness. An indemnity clause reallocates substantial risk—potentially including personal injury liabilities—onto the buyer. That is the kind of significant, non-trivial shift that parties do not reasonably expect to be added by boilerplate; hence, it is a material alteration.
Generally, no. When an acceptance is expressly conditioned on assent to additional terms, the offeror’s silence or mere performance is not treated as the required express assent to those terms. Performance may create a contract by conduct under § 2-207(3), but the contested terms do not carry over unless both sides’ writings agree on them or there is clear, express assent.
Brown Machine v. Hercules demonstrates that powerful boilerplate in a seller’s acknowledgment—like an indemnity clause—will not govern absent clear assent. By deeming the acknowledgment expressly conditional, the court funneled the analysis to § 2-207(3), forming a contract by conduct with only the mutually agreed terms. Even on the alternative path, the indemnity failed as a material alteration rejected by the buyer’s limiting language.
For students and practitioners, the case underscores two drafting imperatives: buyers can effectively preclude surprise terms by limiting acceptance to their own terms and objecting to additions, while sellers seeking to add significant protections must obtain explicit assent. Brown Machine’s framework provides a disciplined checklist for any battle-of-the-forms problem under the UCC.