Anderson's Business Law and the Legal Environment 20th Edition by David Twomey,Marianne Jennings

Exercise 11

Mostek Corp., a Texas corporation, made a contract to sell computer-related products to North American Foreign Trading Corp., a New York corporation. North American used its own purchase order form, on which appeared the statement that any dispute arising out of an order would be submitted to arbitration, as provided in the terms set forth on the back of the order. Acting on the purchase order, Mostek delivered almost all of the goods but failed to deliver the final installment. North American then demanded that the matter be arbitrated. Mostek refused to do so. Was arbitration required? [ Application of Mostek Corp. , 502 N.Y.S.2d 181 (App. Div.)]