UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK
190 F. Supp. 116 (1960) U.S. Dist.
Frigaliment Importing Co. (Plaintiff)
B.N.S. International Sales Corp. (Defendant)
The Defendant, B.N.S. International Sales Corp. entered into two agreements to sell chicken to Frigaliment Importing Co., the Plaintiff. When the first shipment reached Switzerland, the Plaintiff realized that the shipment did not contain young chickens for broiling and frying, but contained heavier birds for stewing. The Defendant Company was of the view that any chicken would be able to meet the specifications of the contract as regards the quantity and weight. Conversely, the Plaintiff Company believed that the term “chicken” in the contract meant young chicken. As such, the Plaintiff sued the Defendant for breach of warranty on the grounds that the defendant Company delivered goods that failed to meet the contract specifications.
- Does the party seeking to interpret an ordinary term of a contract in a narrower sense have the burden of proof to establish that meaning?
- Can verbal evidence be admissible to illustrate the meaning of a word that is considered ambiguous and its practice in a contract?
Rule and analysis
Friendly, J. opined that a party who seeks to interpret an ordinary term of a contract in a narrow sense than its everyday use bears the burden of proving its alleged meaning. The court also held that to show the meaning and usage of an ambiguous word, verbal evidence is admissible.
The court held that the making of a contract is not dependent on the two minds on a single intention but on the two arrangements of exterior messages. The court held that the term chicken was indeed an ambiguous word and that the court must first consider whether the agreement itself can provide some directions as to its interpretation.
The Defendant noted that the contract required the company to supply fresh frozen chicken of Grade A, which was inspected by the government. According to the defendant, the agreement assimilated by reference the regulations set to the department of agriculture.
The court assessed the negotiations that the parties had been engaged to determine the evidence. The communications between the parties were in German. The court learnt from the communication between the two parties that upon request by the Defendant about the kind of chicken the Plaintiff wanted, the latter replied “any chickens” because the Company understood the word chicken to mean young chicken. However, in German, the word Huhn included both stewing chicken and broilers, which the Defendant was well aware because its agencies were familiar with German.
The District Court, Friendly, Circuit Judge, held that the foregoing argument failed to meet its burden of demonstrating that the word 'chicken' in the contract denoted only chickens appropriate for broiling and frying, and did not consist of stewing chickens.