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

Swiss company Frigaliment Importing Co. (Frigaliment) (plaintiff) executed two contracts to purchase chicken from American company B.N.S. International Sales Corp. (BNS) for $0.33 per pound. Although the negotiations were primarily in German, Frigaliment used the English word “chicken” in its cablegrams and orders, intending the term to mean young chickens suitable for broiling and frying (broilers). BNS, which was new to the trade, interpreted Frigaliment’s orders for chicken as encompassing both broilers and older chickens suitable for stewing (fowl). The market rate for broilers was between $0.35 and $0.37 per pound. Fowl was less expensive. Both contracts stated that the chicken was to be “Grade A, Government Inspected,” which, according to BNS, incorporated the Department of Agriculture’s regulations by reference. Those regulations defined the term chicken to include all types of chicken. BNS shipped primarily fowl to Switzerland. After the first shipment, Frigaliment complained but allowed BNS to make the second shipment. It again contained primarily fowl. Frigaliment sued BNS for failure to provide goods matching the contract description. At trial, Frigaliment’s expert claimed that “chicken,” as used in the trade, referred only to broilers. However, the expert’s testimony was undermined by the fact that his own contracts specifically requested “broilers” if he wanted younger birds or “fowl” if he wanted older birds. One of BNS’s suppliers stated that “chicken” did not include fowl, but the supplier admitted that it clarified whether BNS wanted fowl or frying chickens when BNS ordered “chickens.” Frigaliment also offered evidence that at least some suppliers and journals differentiated between “chicken” and “fowl.” Nevertheless, BNS’s experts testified that in the trade, the term chicken encompassed both broilers and fowl. The United States District Court for the Southern District of New York considered the parties’ arguments.