## Facts

- Doughboy Industries, Inc. (buyer) sent purchase orders to Pantasote Company (seller) using Doughboy’s standard form.
- Doughboy’s purchase-order form contained no arbitration clause and stated its terms could be changed only by a writing signed by Doughboy.
- Pantasote accepted by telephone, shipped goods promptly, and later mailed printed acknowledgment forms.
- Pantasote’s acknowledgments included a general arbitration clause requiring arbitration in New York and language stating the buyer would be bound unless it objected within a stated time.
- A dispute arose over whether the buyer was required to accept all goods ordered on a “hold basis.”
- Pantasote sought to arbitrate under its acknowledgment’s arbitration clause; Doughboy denied any agreement to arbitrate and moved to stay arbitration.

## Issues

1. Whether the parties formed an enforceable agreement to arbitrate when the buyer’s purchase order limited acceptance to its own terms and the seller’s later acknowledgment added an arbitration clause in boilerplate.
2. Whether the buyer’s failure to object to the seller’s acknowledgment terms constituted assent to arbitration.

## Decision

- The Appellate Division, First Department, reversed the order denying a stay of arbitration.
- The court granted Doughboy’s application to stay arbitration.
- The court held there was no binding agreement to arbitrate because the arbitration clause in the seller’s acknowledgment did not become part of the parties’ contract.

## Legal Principles

- Arbitration may be compelled only if the parties clearly agreed to arbitrate; it is a matter of contract, not inference from unilateral boilerplate.
- When an offer expressly limits acceptance to the offer’s terms (including a requirement that modifications be in a signed writing), additional terms later proposed in a confirming acknowledgment generally do not become contract terms without affirmative assent.
- An arbitration clause inserted as an additional term in a seller’s acknowledgment is a material change affecting dispute-resolution rights and ordinarily is not incorporated by silence or routine exchange of forms.

## Conclusion

The court stayed arbitration because the contract was formed on the buyer’s purchase-order terms, which barred unapproved additions, and the seller’s later acknowledgment could not unilaterally impose a New York arbitration clause without the buyer’s explicit agreement.


Application of Doughboy Indus., Inc. to Stay Arbitration, 17 A.D.2d 216, 233 N.Y.S.2d 488 (N.Y. App. Div. 1st Dep’t 1962)