WALKER v. BUILDDIRECT.COM TECHNOLOGIES INC.
2015 OK 30
| Okla. | 2015Background
- Walkers purchased 113 boxes of hardwood flooring from BuildDirect for $8,559.70, via BuildDirect's website and a signed two-page Contract titled 'Quotation'.
- The Contract enumerated 14 terms, including a clause that 'All orders are subject to BuildDirect's Terms of Sale.'
- The online 'Terms of Sale' document was accessible via a hyperlink on BuildDirect's website and contained an arbitration provision.
- Walkers later alleged insect infestation and related damages, leading to a federal diversity action in the Western District of Oklahoma with multiple claims.
- BuildDirect moved to compel arbitration; the district court denied; the U.S. Court of Appeals for the Tenth Circuit certified an Oklahoma-law question to this Court.
- This Court held that incorporation by reference requires clear reference, ascertainable identity/location, and assent; mere quotation marks around 'Terms of Sale' do not suffice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether BuildDirect's Terms of Sale on its website was incorporated by reference into the Contract. | Walkers had no notice or assent to online terms; no clear incorporation. | The Contract's phrase 'All orders are subject to BuildDirect's Terms of Sale' puts Walkers on notice to the extrinsic document. | No; terms not properly incorporated by reference. |
Key Cases Cited
- Monkey Island Dev. Auth. v. Staten, 76 P.3d 84 (Okla. Civ. App. 2003) (incorporation by reference where terms identified and assent shown)
- High Sierra Energy, L.P. v. Hull, 241 P.3d 1139 (Okla. Civ. App. 2010) (limitations on vague references to extrinsic terms)
- Continental Supply Co. v. Levy, 247 P. 967 (Okla. 1926) (early recognition of incorporation by reference)
- Aetna Life Ins. Co. v. Bradford, 145 P.316 (Okla. 1914) (formation principles for incorporated writings)
- One Beacon Ins. v. Crowley Marine Serv., Inc., 648 F.3d 258 (5th Cir. 2011) (federal standard for incorporation by reference in internet context)
- Porter v. Oklahoma Farm Bureau Mut. Ins. Co., 330 P.3d 511 (Okla. 2014) (protecting consumers from ambiguous incorporations)
- Scungio v. Scungio, 291 P.3d 616 (Okla. 2012) (contract interpretation to ascertain mutual intent)