knockout rule


  • Contract Law

Definitions of knockout rule

  • the principle in contract law that where terms and conditions that are included on various forms, letters, laws, and agreements used to establish the provisions of a contract in a so-called battle of forms do not agree, those terms cancel each other out and are dropped from the contract. NB battle of forms happens where each party tries to argue that its own terms and conditions have been incorporated into the contract. This can happen when multiple documents, often containing boilerplate terms.

    A manufacturer's motion for summary judgment based on its one-year statute of limitations will fail because of the "knock-out rule." The term in the manufacturer's quotation is directly in conflict with the three-year statute of limitations term contained in the distributor's purchase order.