Southwest Concrete Products v. Gosh Construction Corp

In Southwest Concrete Products v. Gosh Construction Corp. (1990) 51 Cal.3d 701, Gosh purchased concrete pipe from Southwest. The delivery tickets and invoices that accompanied the pipe contained a provision for 18 percent interest on late payments, which the trial court applied. ( Id. at p. 704.) The Supreme Court granted review on the issue whether "a provision in a commercial sales contract which calls for interest of 18 percent per year on late payments violates the usury law." (Ibid.) In the course of deciding that the provision was exempt from the usury law, the Supreme Court preliminarily held the interest provision became part of the contract, pursuant to California Uniform Commercial Code section 2207. ( Id. at pp. 708, 709.) "Section 2207 provides that additional terms become part of a contract between merchants unless the person receiving them objects to them. The official code comment to this section lists as an example of such additional term 'a clause providing for interest on overdue invoices. . . .'" ( Id. at p. 708.)