Frigaliment Importing Co. v. B.N.S. International Sales Corp.

Frigaliment Importing Co. v. B.N.S. International Sales Corp. 190 F.Supp. 116 (1960), is a U.S. District Court for the Southern District of New York case that was ruled on December 27, 1960. The main discourse that stemmed from this case was Frigaliment argued that there was a breach of contract since B.N.S. Int'l Sales Corp (B.N.S.) were providing the wrong type of chickens. The court would rule in favor of B.N.S. since the contract language was too broad in what defined a chicken.^[1]

The argument over the definition of a chicken led to a contract dispute between Frigaliment Importing Co. (the buyer) and B.N.S. Int'l Sales Corp (the seller). Both parties couldn't agree on the definition of chicken, Frigaliment arguing that they weren't providing the right type of chicken since they interpreted chickens as young and suitable for broiling/frying. B.N.S. on the other hand, argued that language that was used in the contract included all types of chicken and not exclusively young that were suitable for broiling/frying. In other words, B.N.S argued that the contract language was too broad, therefore the definition of a chicken would also be broad. In the end, the court would rule in favor of B.N.S., since Frigaliment failed to specify the specific definition of "chicken" they intended and therefore, there was no breach of contract.^[1]

The two parties involved in the case were the plaintiff, a Swiss corporation known as Frigaliment Importing Co. and the defendant, a New York Company known as B.N.S. International Sales Corp. Initial negotiations began between the two around the early of 1957 with Frigaliment Importing Co. wanting to purchase 25,000 pounds of chicken. After a few weeks of deliberation, on May 2, 1957, two contracts were signed and agreed upon for the sale of "US Fresh Frozen Chicken, Grade A, Government Inspected." The initial contract was scheduled for May 10, 1957 for a grand total of 100,000 pounds of chicken. The second contract, which was also dated May 2, with shipment scheduled for May 30, 1957, for a grand total of 75,000 pounds of chicken. What is important to note is that both contracts included different weight class specifications: 2½-3 pounds and 1½-2 pounds.^[1]

On May 28, 1957, Frigaliment received the first shipment but they discovered that the heavier 2½-3 pounds birds were not young chickens suitable for frying and broiling. The plaintiff notified B.N.S. International Sales Corp of their concerns before the second shipment arrived. Once the second shipment arrived on May 29, Frigaliment didn't receive the type of chickens they wanted which led to the dispute going into the courts when Frigaliment filed suit against B.N.S. International Sales Corp for a breach of goods that didn't fit the contract descriptions.

On December 27, 1960, the ruling was decided in favor of the defendant B.N.S. International Sales Corp. It was ruled by Judge Henry J. Friendly of the United States District Court for the Southern District of New York and was in favor of the defendant since the plaintiff failed to meet the burden of proof, more specifically the definition of chicken that they wanted.^[2]

The argument that Frigaliment said they had is that they deemed the chicken in the contract they agreed upon as "young" and "suitable for broiling and frying". They backed their argument with evidence that in the chicken trade, chicken was typically understood to mean young chicken. Therefore, they believed that a breach of contract was committed by B.N.S since they only provided older chicken. The argument that B.N.S said was that the word chicken has such a broad definition which wasn't specified in the contract. The only specifications that were presented in the contract was the two weight classes. They would also back their argument with evidence from the chicken trade but they would argue that chicken was considered a general term while more specific terms like "broiler" or "fryer" should've been needed if that was what the buyer desired. They would cite Frigaliment's own representatives with their own statement of wanting "any kind of chickens". B.N.S would also argue that the price agreed upon was considered low for the type of chicken that Frigaliment wanted and was rather consistent with older chickens that they were sending.^[2]

December 27, 1960 was the date that Judge Henry J. Friendly ruled on behalf of the United States District Court for the Southern District of New York. The court's ruling was in favor of the defendant, B.N.S. International Sales Corp. The ruling was based on the principle of burden of proof, a principle the plaintiff, Frigaliment Importing Co. failed to accomplish. Frigaliment needed to proof that the contract term "chicken" had the exact definition they claimed which was young chickens that were suitable for frying/broiling. The court found the word "chicken" to be ambiguous, as it has various valid meanings and definition in both the generic everyday language and the chicken trade. Since the contract itself didn't clearly clarify the term, the court had to resort to using outside evidence and arguments such as witness testimonies from both industry members and individuals from both parties in order to determine both parties' meanings. In the end, the court ruled that Frigaliment failed to provide burden of proof since their argument of their definition of chicken was the intended and defined definition that was stated and agreed in the contracts.^[2]

The significance of Frigaliment Importing Co. v. B.N.S. Int'l Sales Corp is that it's a great example of how courts interpret and rule on ambiguous contract terms. The main takeaway from this case is that it's a phenomenal example of contract interpretation when a term is ambiguous. What is chicken? This might be a silly question but this question was argued and debated enough that it resulted in a court case. This case highlights the idea that a word can have various valid meanings. If a contract was created and agreed upon but it doesn't clearly define the term, then a court is forced to look and analyze beyond the written document to understand the parties' intent. This case illustrates that courts don't choose one meaning and/or intent over another but the courts analyze all disposable evidence to reach the conclusion on the most reasonable interpretation. This was a landmark case since it set the precedent of avoiding using ambiguous terms in contract in order to best avoid burden of proof.^[3]

The impact of this case is that it set a precedent that can be seen and demonstrated in similar cases. For example, Cerveceria Modelo De Mexico v. CB Brand Strategies, LLC. was a case that essentially shared the same argument of Frigaliment Importing Co. v. B.N.S. Int'l Sales Corp., a dispute around what is the correct definition of an ambiguous term, more specifically, the term of beer. Frigaliment Importing Co. v. B.N.S. Int'l Sales Corp. was actually used as precedent in the case and was ruled in 2023 which demonstrates that the significance of Frigaliment Importing Co. v. B.N.S. Int'l Sales Corp. is still felt to this day.^[4]