04-2551 Chicago Prime Packers, Inc., v. Northam Food Trading Co.

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“The CISG does not state expressly whether the seller or buyer bears the burden of proof as to the product’s conformity with the contract. Because there is little case law under the CISG, we interpret its provisions by looking to its language and to ‘the general principles’ upon which it is based. See CISG Art. 7(2); see also Delchi Carrier SpA v. Rotorex Corp., 71 F.3d 1024, 1027-28 (2d Cir. 1995). The CISG is the international analogue to Article 2 of the Uniform Commercial Code (’UCC‘). Many provisions of the UCC and the CISG are the same or similar, and ‘[c]aselaw interpreting analogous provisions of Article 2 of the [UCC], may . . . inform a court where the language of the relevant CISG provision tracks that of the UCC.’ Delchi Carrier SpA, 71 F.3d at 1028. ‘However, UCC caselaw “is not per se applicable.”’ Id. (quoting Orbisphere Corp. v. United States, 726 F. Supp. 1344, 1355 (Ct. Int’l Trade 1989)).

“A comparison with the UCC reveals that the buyer bears the burden of proving nonconformity under the CISG. Under the UCC, the buyer may plead breach of the implied warranty of fitness for ordinary purpose as an affirmative defense to a contract action by the seller for the purchase price. See Comark Merch., Inc. v. Highland Group, Inc., 932 F.2d 1196, 1203 (7th Cir. 1991); Alberts Bonnie Brae, Inc. v. Ferral, 544 N.E.2d 422, 423 (Ill. App. 1989); see also 77A CORPUS JURIS SECUNDUM SALES § 287 (2004) (’[T]he buyer, when sued for the purchase price, may set up a breach of warranty as a defense to the seller’s action.’). In such an action it is the defendant-buyer’s burden to prove the breach of the warranty. See Comark Merch., 932 F.2d at 1203; Alberts Bonnie Brae, 544 N.E.2d at 424-25. Section 2-314 of the UCC provides that a warranty that goods are ‘fit for the ordinary purpose for which such goods are used‘ is implied unless the contract states otherwise. Mirroring the structure and content of this section, Article 35(2) of the CISG provides that unless the contract states otherwise, ‘goods do not conform with the contract unless they . . . [a]re fit for the purposes for which goods of the same description would ordinarily be used.’ See RALPH H. FOLSOM, 1 INTERNATIONAL BUSINESS TRANSACTIONS § 1.15, at 39 (2d ed. 2002) (the CISG’s approach ‘produces results which are comparable to the “warranty” structure of the UCC.’). Accordingly, just as a buyer-defendant bears the burden of proving breach of the implied warranty of fitness for ordinary purpose under the UCC, under the CISG, the buyer-defendant bears the burden of proving nonconformity at the time of transfer. See Larry A. DiMatteo et al., The Interpretive Turn in International Sales Law: An Analysis of Fifteen Years of CISG Jurisprudence, 24 NW. J. INT’L L. & BUS. 299, 400 (2004) (Under the CISG, ‘[t]he buyer is allocated the burden of proving that the goods were defective prior to the expiration of the seller’s obligation point.’); see also FOLSOM, 1 INTERNATIONAL BUSINESS TRANSACTIONS § 1.15, at 41. The district court was correct to conclude that Northam bears the burden of proving that the ribs were spoiled at the time of transfer.

“The evidence supporting Northam’s position was not so overwhelming that it was clear error to find in favor of Chicago Prime. Northam offered no credited evidence showing that the ribs were spoiled at the time of transfer or excluding the possibility that the ribs became spoiled after the transfer. In addition, it presented no evidence that Brookfield stored the ribs in unacceptable conditions that could have caused them to become spoiled before the transfer. Finally, Northam did not present a witness from Beacon to respond to the evidence suggesting that the ribs examined by Dr. Maltby were not those sold to Northam by Chicago Prime. Upon this record, the district court did not clearly err in finding that Northam did not meet its burden of proof as to its affirmative defense of nonconformity.”

Affirmed.

Appeal from the United States District Court for the Northern District of Illinois, Brown, Mag. J., Flaum, J.