HOMEWORK ASSIGNMENT #2 I. Brief: Frigaliment Importing Co. V. B.N.S International Sales Corp, which is attached to this homework assignment (see the next page). II. Discussion Questions: 1. Discuss the difference between Procedural Due Process and Substantive Due Process reviewed on pages 158-160, 167 and 168 of the text book. III. Chapter 5 Case Problems and Writing Assignments. 1. The City of Fresberg is located in the State of Confusion, but is on the border with the State of Washington. For a number of years Fresberg and the outlining area had an active granite industry, but recently production has been declining. To boost production, the City Counsel passed an ordinance requiring all granite used within the city limits to be (1) produced within a fifty mile radius of Fresberg, and (2) within the State of Confusion. A granite producer, who is located in the neighboring State of Washington, was set to supply granite to a work site in the City of Fresberg. Due to the new law, however, it can no longer do so. Assume the contractor comes to you for advice, and you must explain to him whether he has a claim under the concept of the “Dormant Commerce Clause” against the City of Fresberg. Please use the IRAC format to prepare your advice. For a review of the Dorman Commerce Clause please see the PowerPoint presentation for Chapter 5. Frigaliment v. B.N.S. Frigaliment sued B.N.S. alleging that B.N.S. had breached its warranty in each of two contracts. In the first contract B.N.S. had agreed to sell Frigaliment 75,000 pounds of 2.5 to 3 pound chickens. The second contract called for 50,000 pounds of 2.5 to 3 pound chickens and 25,000 pounds of the 1.5 to 2 pound chickens, with the smaller chickens at a slighter higher price than in the first contract. Both contracts were signed on May 2, 1957, B.N.S., made two shipments to satisfy the first contract. The first delivery was a little short, but the shortage was made up in the second shipment. Following delivery, Frigaliment discovered that the larger chickens were not young chickens suitable for frying or broiling, but were older chickens, or fowl, considered to be stewing chickens. Frigaliment protested and B.N.S. stopped shipment of the chickens under the second contract. Frigaliment then sued, claiming that under the terms of the contract, all of the chickens shipped by B.N.S. were to be young chickens. B.N.S. asserted that its obligation was simply to ship chickens that met the description in the contract. And that it was not restricted to only young birds. In this case the court decided the following issues: (1) How should the term chicken, as used in the contract, be defined; (2) does the party seeking a narrow interpretation of a term of the contract have the burden of proof in establishing that meaning; and (3) can parol evidence – i.e., evidence from outside the written contract be used to define an ambiguous term? The court held that the word chicken, standing alone, is ambiguous. The party asserting that narrower definition has the burden of proving that this definition is appropriate, and parole evidence can be used to establish the meaning of the ambiguous terms. Excerpts from the opinion are as follows: The issue is what is chicken? Plaintiff says “chicken” means a young chicken suitable for broiling and frying. Defendant says “chicken” means any bird of the genus that meets contract specifications on weight and quality, including what it calls “stewing chicken.” In response plaintiff [cries fowl.] Dictionaries have both meanings, as well as some others not relevant here. To support its claim, plaintiff sends a number of volleys over the net; defendant essays to return them and adds a few serves of its own. Assuming that both parties were acting in good faith, the case nicely illustrates Holmes’ remark “that the making of a contract depends not on the agreement of the two minds in one intention, but on the agreement of two sets of external signs – not on the parties’ having meant the same thing but on their having said the same thing.”. . . I have concluded that plaintiff has not sustained its burden of persuasion that the contract used “chicken” in the narrower sense. . . When the initial shipment arrived in Switzerland, plaintiff found . . . that the 2 ½3 lbs. birds were not young chicken suitable for broiling and frying but stewing chicken or “fowl”; indeed many of the cartons and bags plainly so indicated. Protests ensued. Nevertheless, shipment under the second contract was made on May 29, the 2 ½-3 lbs. birds again being stewing chicken. Defendant stopped the transportation of these at Rotterdam. Since the word “chicken” standing alone is ambiguous, I turn first to see whether the contract itself offers any aid to its interpretation. Plaintiff says the 1 ½-2 lbs. birds necessarily had to be young chicken since the older birds do not come in that size, hence the 2 ½ 3 lbs. birds must be likewise be young. This is unpersuasive – a contract for “apples” of two different sizes could be filled with different kinds of apples even though only one species came in both sizes. Defendant notes that the contract called not simply for chicken but for “US Fresh Frozen Chicken, grade A, Government Inspected.” It says the contract thereby incorporated by reference the Department of Agriculture’s regulations, which favor its interpretation . . . Defendant’s witness [testified that] . . . “[c]hicken is everything except a goose, a duck, and a turkey. Everything is a chicken, but then you have to say, you have to specify which category you want or that you are talking about.” . . . [I]n the trade “chicken” would encompass all the various classifications. . . . [Another ] testified that he would consider any bird coming within the classes of “chicken” in the Department of Agriculture’s regulations to be a chicken. The specifications approved by the General services Administration include fowl as well as broilers and fryers under the classification “chickens.” . . . When all the evidence is reviewed, it is clear that defendant believed it could comply with the contract by delivering stewing chicken in the 2 ½-3 lbs size. Defendant’s subjective intent would not be significant if this did not coincide with an objective meaning of “chicken.” Here it coincides with one of the dictionary meanings, with the definition in the Department of Agriculture Regulations to which the contract made a least oblique reference, with a least some usage in the trade, with the realities of the market, and with what plaintiff’s spokesman had said. Plaintiff asserts it to be equally plain that plaintiff’s own subjective intent was to obtain broilers and fryers; the only evidence against this is the material as to market prices and this may not have been sufficiently brought home. In any event it is unnecessary to determine that issue. For plaintiff has the burden of showing that “chicken” was used in the narrower rather than in the broader sense. And this it has not sustained. This opinion constitutes the Court’s finding of fact and conclusions of law. Judgment shall be entered dismissing the complaint with costs. Case Problem and Writing Assignment Issue: Can Bill file the lawsuit in Federal Court rather than in state court? Rule: This case turns on whether the requirements for diversity jurisdiction exist. Diversity jurisdiction allows a party to file a state law action in federal court if (1) the parties to the action are from different states; and (2) the amount being sought in damages is in excess of $75,000. Analysis: Here Bill is a resident of Fresno County in California. Ron is a resident of Las Vegas in Nevada. Therefore, the two parties are from different states. Additionally, Bill’s damages include lost wages, pain and suffering, and medical expenses. The total of these damages is approximately $100,000, which is substantially larger than $75,000. Conclusion: Given the facts of this case (i.e., that Bill and Ron are from different states and that Bill is suing for $100,000), Bill may file the lawsuit in Federal Court.