PUBLISH
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
_______________
No. 97-4250 _______________ D. C. Docket No. 92-2108-CIV
MCC-MARBLE CERAMIC CENTER, INC.,
Plaintiff-Counter-Defendant-Appellant,
versus
CERAMICA NUOVA D'AGOSTINO, S.P.A.,
Defendant-Counter-Claimant-Appellee.
______________________________
Appeal from the United States District Court for the Southern District of Florida ______________________________ (June 29, 1998)
Before EDMONDSON and BIRCH, Circuit Judges and FAY, Senior Circuit Judge. BIRCH, Circuit Judge:
This case requires us to determine whether a court must
consider parol evidence in a contract dispute governed by the United
Nations Convention on Contracts for the International Sale of Goods
(“CISG”).1 The district court granted summary judgment on behalf
of the defendant-appellee, relying on certain terms and provisions
that appeared on the reverse of a pre-printed form contract for the
sale of ceramic tiles. The plaintiff-appellant sought to rely on a
number of affidavits that tended to show both that the parties had
arrived at an oral contract before memorializing their agreement in
writing and that they subjectively intended not to apply the terms on
the reverse of the contract to their agreements. The magistrate
judge held that the affidavits did not raise an issue of material fact
and recommended that the district court grant summary judgment
based on the terms of the contract. The district court agreed with
1 United Nations Convention on Contracts for the International Sale of Goods, opened for signature April 11, 1980, S. Treaty Doc. No. 9, 98th Cong., 1st Sess. 22 (1983), 19 I.L.M. 671, reprinted at, 15 U.S.C. app. 52 (1997).
2 the magistrate judge's reasoning and entered summary judgment in
the defendant-appellee's favor. We REVERSE.
BACKGROUND
The plaintiff-appellant, MCC-Marble Ceramic, Inc. (“MCC”), is
a Florida corporation engaged in the retail sale of tiles, and the
defendant-appellee, Ceramica Nuova d'Agostino S.p.A.
(“D'Agostino”) is an Italian corporation engaged in the manufacture
of ceramic tiles. In October 1990, MCC's president, Juan Carlos
Mozon, met representatives of D'Agostino at a trade fair in Bologna,
Italy and negotiated an agreement to purchase ceramic tiles from
D'Agostino based on samples he examined at the trade fair.
Monzon, who spoke no Italian, communicated with Gianni Silingardi,
then D'Agostino's commercial director, through a translator,
Gianfranco Copelli, who was himself an agent of D'Agostino.2 The
2 Since this case is before us on summary judgment, we consider the facts in the light most favorable to MCC, the non- moving party, and grant MCC the benefit of every factual inference. See Welch v. Celotex Corp., 951 F.2d 1235, 1237 (11th Cir. 1992).
3 parties apparently arrived at an oral agreement on the crucial terms
of price, quality, quantity, delivery and payment. The parties then
recorded these terms on one of D'Agostino's standard, pre-printed
order forms and Monzon signed the contract on MCC's behalf.
According to MCC, the parties also entered into a requirements
contract in February 1991, subject to which D'Agostino agreed to
supply MCC with high grade ceramic tile at specific discounts as
long as MCC purchased sufficient quantities of tile. MCC completed
a number of additional order forms requesting tile deliveries
pursuant to that agreement.
MCC brought suit against D'Agostino claiming a breach of the
February 1991 requirements contract when D'Agostino failed to
satisfy orders in April, May, and August of 1991. In addition to other
defenses, D'Agostino responded that it was under no obligation to
fill MCC's orders because MCC had defaulted on payment for
previous shipments. In support of its position, D'Agostino relied on
the pre-printed terms of the contracts that MCC had executed. The
4 executed forms were printed in Italian and contained terms and
conditions on both the front and reverse. According to an English
translation of the October 1990 contract,3 the front of the order form
contained the following language directly beneath Monzon's
signature:
[T]he buyer hereby states that he is aware of the sales conditions stated on the reverse and that he expressly approves of them with special reference to those numbered 1-2-3-4-5-6-7-8.
R2-126, Exh. 3 ¶ 5 (“Maselli Aff.”). Clause 6(b), printed on the back
of the form states:
[D]efault or delay in payment within the time agreed upon gives D'Agostino the right to . . . suspend or cancel the contract itself and to cancel possible other pending contracts and the buyer does not have the right to indemnification or damages.
Id. ¶ 6.
D'Agostino also brought a number of counterclaims against
MCC, seeking damages for MCC's alleged nonpayment for
3 D'Agostino provided the translation of the contract. MCC has never contested its accuracy.
5 deliveries of tile that D'Agostino had made between February 28,
1991 and July 4, 1991. MCC responded that the tile it had received
was of a lower quality than contracted for, and that, pursuant to the
CISG, MCC was entitled to reduce payment in proportion to the
defects.4 D'Agostino, however, noted that clause 4 on the reverse
of the contract states, in pertinent part:
Possible complaints for defects of the merchandise must be made in writing by means of a certified letter within and not later than 10 days after receipt of the merchandise . . ..
Maselli Aff. ¶ 6. Although there is evidence to support MCC's claims
that it complained about the quality of the deliveries it received, MCC
never submitted any written complaints.
MCC did not dispute these underlying facts before the district
court, but argued that the parties never intended the terms and
conditions printed on the reverse of the order form to apply to their
agreements. As evidence for this assertion, MCC submitted
4 Article 50 of the CISG permits a buyer to reduce payment for nonconforming goods in proportion to the nonconformity under certain conditions. See CISG, art. 50.
6 Monzon's affidavit, which claims that MCC had no subjective intent
to be bound by those terms and that D'Agostino was aware of this
intent. MCC also filed affidavits from Silingardi and Copelli,
D'Agostino's representatives at the trade fair, which support
Monzon's claim that the parties subjectively intended not to be
bound by the terms on the reverse of the order form. The magistrate
judge held that the affidavits, even if true, did not raise an issue of
material fact regarding the interpretation or applicability of the terms
of the written contracts and the district court accepted his
recommendation to award summary judgment in D'Agostino's favor.
MCC then filed this timely appeal.
DISCUSSION
We review a district court's grant of summary judgment de novo
and apply the same standards as the district court. See Harris v.
H&W Contracting Co., 102 F.3d 516, 518 (11th Cir. 1996).
Summary judgment is appropriate when the pleadings, depositions,
7 and affidavits reveal that no genuine issue of material fact exists and
the moving party is entitled to judgment as a matter of law. See
Fed. R. Civ. P. 56(c).
The parties to this case agree that the CISG governs their
dispute because the United States, where MCC has its place of
business, and Italy, where D'Agostino has its place of business, are
both States Party to the Convention.5 See CISG, art. 1.6 Article 8
of the CISG governs the interpretation of international contracts for
the sale of goods and forms the basis of MCC's appeal from the
district court's grant of summary judgment in D'Agostino's favor.7
5 The United States Senate ratified the CISG in 1986, and the United States deposited its instrument of ratification at the United Nations Headquarters in New York on December 11, 1986. See Preface to Convention, reprinted at 15 U.S.C. app. 52 (1997). The Convention entered into force between the United States and the other States Parties, including Italy, on January 1, 1988. See id.; Filanto S.p.A. v. Chilewich Int'l Corp., 789 F. Supp. 1229, 1237 (S.D.N.Y. 1992). 6 Article 1 of the CISG states in relevant part: (1) This Convention applies to contracts of sale of goods between parties whose places of business are in different States: (a) When the States are Contracting States . . . . CISG, art. 1. 7 Article 8 provides: (1) For the purposes of this Convention statements made by and other conduct of a party are to be interpreted according to his intent where the other party knew or
8 MCC argues that the magistrate judge and the district court
improperly ignored evidence that MCC submitted regarding the
parties' subjective intent when they memorialized the terms of their
agreement on D'Agostino's pre-printed form contract, and that the
magistrate judge erred by applying the parol evidence rule in
derogation of the CISG.
I. Subjective Intent Under the CISG
Contrary to what is familiar practice in United States courts, the
CISG appears to permit a substantial inquiry into the parties'
subjective intent, even if the parties did not engage in any objectively
could not have been unaware what that intent was.
(2) If the preceding paragraph is not applicable, statements made by and conduct of a party are to be interpreted according to the understanding a reasonable person of the same kind as the other party would have had in the same circumstances.
(3) In determining the intent of a party or the understanding a reasonable person would have had, due consideration is to be given to all relevant circumstances of the case including the negotiations, any practices which the parties have established between themselves, usages and any subsequent conduct of the parties. CISG, art. 8.
9 ascertainable means of registering this intent.8 Article 8(1) of the
CISG instructs courts to interpret the “statements . . . and other
conduct of a party . . . according to his intent” as long as the other
party “knew or could not have been unaware” of that intent. The
plain language of the Convention, therefore, requires an inquiry into
a party's subjective intent as long as the other party to the contract
was aware of that intent.
In this case, MCC has submitted three affidavits that discuss
the purported subjective intent of the parties to the initial agreement
concluded between MCC and D'Agostino in October 1990. All three
8 In the United States, the legislatures, courts, and the legal academy have voiced a preference for relying on objective manifestations of the parties' intentions. For example, Article Two of the Uniform Commercial Code, which most states have enacted in some form or another to govern contracts for the sale of goods, is replete with references to standards of commercial reasonableness. See e.g., U.C.C. § 2-206 (referring to reasonable means of accepting an offer); see also Lucy v. Zehmer, 196 Va. 493, 503, 84 S.E.2d 516, 522 (1954) (“Whether the writing signed . . . was the result of a serious offer . . . and a serious acceptance . . . , or was a serious offer . . . and an acceptance in secret jest . . . , in either event it constituted a binding contract of sale between the parties.”). Justice Holmes expressed the philosophy behind this focus on the objective in forceful terms: “The law has nothing to do with the actual state of the parties' minds. In contract, as elsewhere, it must go by externals, and judge parties by their conduct.” Oliver W. Holmes, The Common Law 242 (Howe ed. 1963) quoted in John O. Honnold, Uniform Law for International Sales under the 1980 United Nations Convention § 107 at 164 (2d ed. 1991) (hereinafter Honnold, Uniform Law).
10 affidavits discuss the preliminary negotiations and report that the
parties arrived at an oral agreement for D'Agostino to supply
quantities of a specific grade of ceramic tile to MCC at an agreed
upon price. The affidavits state that the “oral agreement
established the essential terms of quality, quantity, description of
goods, delivery, price and payment.” See R3-133 ¶ 9 (“Silingardi
Aff.”); R1-51 ¶ 7 (“Copelli Aff.”); R1- 47 ¶ 7 (“Monzon Aff.”). The
affidavits also note that the parties memorialized the terms of their
oral agreement on a standard D'Agostino order form, but all three
affiants contend that the parties subjectively intended not to be
bound by the terms on the reverse of that form despite a provision
directly below the signature line that expressly and specifically
incorporated those terms.9
9 MCC makes much of the fact that the written order form is entirely in Italian and that Monzon, who signed the contract on MCC's behalf directly below this provision incorporating the terms on the reverse of the form, neither spoke nor read Italian. This fact is of no assistance to MCC's position. We find it nothing short of astounding that an individual, purportedly experienced in commercial matters, would sign a contract in a foreign language and expect not to be bound simply because he could not comprehend its terms. We find nothing in the CISG that might counsel this type of reckless behavior and nothing that signals any retreat from the proposition that parties who sign contracts will be bound by them
11 The terms on the reverse of the contract give D'Agostino the
right to suspend or cancel all contracts in the event of a buyer's non-
payment and require a buyer to make a written report of all defects
within ten days. As the magistrate judge's report and
recommendation makes clear, if these terms applied to the
agreements between MCC and D'Agostino, summary judgment
would be appropriate because MCC failed to make any written
complaints about the quality of tile it received and D'Agostino has
established MCC's non-payment of a number of invoices amounting
to $108,389.40 and 102,053,846.00 Italian lira.
Article 8(1) of the CISG requires a court to consider this
evidence of the parties' subjective intent. Contrary to the magistrate
judge's report, which the district court endorsed and adopted, article
8(1) does not focus on interpreting the parties' statements alone.
regardless of whether they have read them or understood them. See e.g., Samson Plastic Conduit and Pipe Corp. v. Battenfeld Extrusionstechnik GMBH, 718 F. Supp. 886, 890 (M.D. Ala. 1989) (“A good and recurring illustration of the problem . . . involves a person who is . . . unfamiliar with the language in which a contract is written and who has signed a document which was not read to him. There is all but unanimous agreement that he is bound . . . . “)
12 Although we agree with the magistrate judge's conclusion that no
“interpretation” of the contract's terms could support MCC's
position,10 article 8(1) also requires a court to consider subjective
intent while interpreting the conduct of the parties. The CISG's
language, therefore, requires courts to consider evidence of a party's
subjective intent when signing a contract if the other party to the
contract was aware of that intent at the time. This is precisely the
type of evidence that MCC has provided through the Silingardi,
Copelli, and Monzon affidavits, which discuss not only Monzon's
intent as MCC's representative but also discuss the intent of
D'Agostino's representatives and their knowledge that Monzon did
not intend to agree to the terms on the reverse of the form contract.
This acknowledgment that D'Agostino's representatives were aware
of Monzon's subjective intent puts this case squarely within article
10 The magistrate judge's report correctly notes that MCC has not sought an interpretation of those terms, but rather to exclude them altogether. We agree that such an approach “would render terms of written contracts virtually meaningless and severely diminish the reliability of commercial contracts.” R2-102 at 5-6.
13 8(1) of the CISG, and therefore requires the court to consider MCC's
evidence as it interprets the parties' conduct.11
II. Parol Evidence and the CISG
Given our determination that the magistrate judge and the
district court should have considered MCC's affidavits regarding the
parties' subjective intentions, we must address a question of first
impression in this circuit: whether the parol evidence rule, which
bars evidence of an earlier oral contract that contradicts or varies the
terms of a subsequent or contemporaneous written contract,12 plays
11 Without this crucial acknowledgment, we would interpret the contract and the parties' actions according to article 8(2), which directs courts to rely on objective evidence of the parties' intent. On the facts of this case it seems readily apparent that MCC's affidavits provide no evidence that Monzon's actions would have made his alleged subjective intent not to be bound by the terms of the contract known to “the understanding that a reasonable person . . . would have had in the same circumstances.” CISG, art 8(2). 12 The Uniform Commercial Code includes a version of the parol evidence rule applicable to contracts for the sale of goods in most states: Terms with respect to which the confirmatory memoranda of the parties agree or which are otherwise set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented
14 any role in cases involving the CISG. We begin by observing that
the parol evidence rule, contrary to its title, is a substantive rule of
law, not a rule of evidence. See II E. Allen Farnsworth, Farnsworth
on Contracts, § 7.2 at 194 (1990). The rule does not purport to
exclude a particular type of evidence as an “untrustworthy or
undesirable” way of proving a fact, but prevents a litigant from
attempting to show “the fact itself—the fact that the terms of the
agreement are other than those in the writing.” Id. As such, a
federal district court cannot simply apply the parol evidence rule as
a procedural matter—as it might if excluding a particular type of
evidence under the Federal Rules of Evidence, which apply in
federal court regardless of the source of the substantive rule of
decision. Cf. id. § 7.2 at 196.13
(a) by course of dealing or usage of trade . . . or by course of performance . . . ; and (b) by evidence of consistent additional terms unless the court finds the writing to have been intended also as a complete and exclusive statement of the terms of the agreement.
U.C.C. § 2-202. 13 An example demonstrates this point. The CISG provides that a contract for the sale of goods need not be in writing and that
15 The CISG itself contains no express statement on the role of
parol evidence. See Honnold, Uniform Law § 110 at 170. It is clear,
however, that the drafters of the CISG were comfortable with the
concept of permitting parties to rely on oral contracts because they
eschewed any statutes of fraud provision and expressly provided for
the enforcement of oral contracts. Compare CISG, art. 11 (a
contract of sale need not be concluded or evidenced in writing) with
U.C.C. § 2-201 (precluding the enforcement of oral contracts for the
sale of goods involving more than $500). Moreover, article 8(3) of
the CISG expressly directs courts to give “due consideration . . . to
all relevant circumstances of the case including the negotiations . .
.” to determine the intent of the parties. Given article 8(1)'s directive
to use the intent of the parties to interpret their statements and
the parties may prove the contract “by any means, including witnesses.” CISG, art. 11. Nevertheless, a party seeking to prove a contract in such a manner in federal court could not do so in a way that violated in the rule against hearsay. See Fed. R. Evid. 802 (barring hearsay evidence). A federal district court applies the Federal Rules of Evidence because these rules are considered procedural, regardless of the source of the law that governs the substantive decision. Cf. Farnsworth on Contracts § 7.2 at 196 & n. 16 (citing cases).
16 conduct, article 8(3) is a clear instruction to admit and consider parol
evidence regarding the negotiations to the extent they reveal the
parties' subjective intent.
Despite the CISG's broad scope, surprisingly few cases have
applied the Convention in the United States,14 see Delchi Carrier
SpA v. Rotorex Corp., 71 F.3d 1024, 1027-28 (2d Cir. 1995)
(observing that “there is virtually no case law under the
Convention”), and only two reported decisions touch upon the parol
evidence rule, both in dicta. One court has concluded, much as we
have above, that the parol evidence rule is not viable in CISG cases
in light of article 8 of the Convention. In Filanto, a district court
addressed the differences between the UCC and the CISG on the
issues of offer and acceptance and the battle of the forms. See 789
F. Supp. at 1238. After engaging in a thorough analysis of how the
CISG applied to the dispute before it, the district court tangentially
14 Moreover, the parties have not cited us to any persuasive authority from the courts of other States Party to the CISG. Our own research uncovered a promising source for such decisions at , but produced no cases that address the issue of parol evidence.
17 observed that article 8(3) “essentially rejects . . . the parol evidence
rule.” Id. at 1238 n.7. Another court, however, appears to have
arrived at a contrary conclusion. In Beijing Metals & Minerals
Import/Export Corp. v. American Bus. Ctr., Inc., 993 F.2d 1178 (5th
Cir. 1993), a defendant sought to avoid summary judgment on a
contract claim by relying on evidence of contemporaneously
negotiated oral terms that the parties had not included in their written
agreement. The plaintiff, a Chinese corporation, relied on Texas law
in its complaint while the defendant, apparently a Texas
corporation,15 asserted that the CISG governed the dispute. Id. at
1183 n.9. Without resolving the choice of law question,16 the Fifth
15 The Beijing Metals opinion does not state the place of the defendant's incorporation, but the defendant must have been a United States corporation because the court noted that the case was a “diversity action.” Beijing Metals, 993 F.2d at 1183 n.9. Cf. 28 U.S.C. § 1332 (providing no statutory grant for suits between aliens unless a citizen of a State is present); 15 James W. Moore, Moore's Federal Practice § 102.77 (3d ed. 1998) (observing that diversity jurisdiction is not present in suits between two foreign citizens). 16 The Fifth Circuit unwittingly may have solved the problem in the very next footnote, where it observed that the agreement between the parties, which attempted to settle a dispute regarding an earlier sales contract, was not itself a contract for the sale of goods and therefore fell outside the Uniform Commercial Code. Beijing Metals, 993 F.2d at 1183 n.10. See CISG, art. 1(1) (“This Convention applies to contracts of sale of goods . . . .”)
18 Circuit cited Filanto for the proposition that there have been very few
reported cases applying the CISG in the United States, and stated
that the parol evidence rule would apply regardless of whether
Texas law or the CISG governed the dispute. Beijing Metals, 993
F.2d at 1183 n.9. The opinion does not acknowledge Filanto's more
applicable dictum that the parol evidence rule does not apply to
CISG cases nor does it conduct any analysis of the Convention to
support its conclusion. In fact, the Fifth Circuit did not undertake to
interpret the CISG in a manner that would arrive at a result
consistent with the parol evidence rule but instead explained that it
would apply the rule as developed at Texas common law. See id.
at 1183 n.10. As persuasive authority for this court, the Beijing
Metals opinion is not particularly persuasive on this point.
Our reading of article 8(3) as a rejection of the parol evidence
rule, however, is in accordance with the great weight of academic
commentary on the issue. As one scholar has explained:
(emphasis added).
19 [T]he language of Article 8(3) that “due consideration is to be given to all relevant circumstances of the case” seems adequate to override any domestic rule that would bar a tribunal from considering the relevance of other agreements. . . . Article 8(3) relieves tribunals from domestic rules that might bar them from “considering” any evidence between the parties that is relevant. This added flexibility for interpretation is consistent with a growing body of opinion that the “parol evidence rule” has been an embarrassment for the administration of modern transactions. Honnnold, Uniform Law § 110 at 170-71.17 Indeed, only one
commentator has made any serious attempt to reconcile the parol
evidence rule with the CISG. See David H. Moore, Note, The Parol
17 See also Louis F. Del Duca, et al., Sales Under the Uniform Commercial Code and the Convention on International Sale of Goods, 173-74 (1993); Henry D. Gabriel, A Primer on the United Nations Convention on the International Sale of Goods: From the Perspective of the Uniform Commercial Code, 7 Ind. Int'l & Comp. L. Rev. 279, 281 (1997) (“Subjective intent is given primary consideration . . . . [Article 8] allows open-ended reliance on parol evidence . . . .”); Herbert Berstein & Joseph Lookofsky, Understanding the CISG in Europe 29 (1997) (“[T]he CISG has dispensed with the parol evidence rule which might otherwise operate to exclude extrinsic evidence under the law of certain Common Law countries.”); Harry M. Fletchner, Recent Developments: CISG, 14 J.L. & Com. 153, 157 (1995) (criticizing the Beijing Metals opinion and noting that “[c]ommentators generally agree that article 8(3) rejects the approach to the parol evidence questions taken by U.S. domestic law.”) (collecting authority); John E. Murray, Jr., An Essay on the Formation of Contracts and Related Matters Under the United Nations Convention on Contracts for the International Sale of Goods, 8 J.L. & Com. 11, 12 (1988) (“We are struck by a new world where there is . . . no parol evidence rule, among other differences.”); Peter Winship, Domesticating International Commercial Law: Revising U.C.C. Article 2 in Light of the United Nations Sales Convention, 37 Loy. L. Rev. 43, 57 (1991).
20 Evidence Rule and the United Nations Convention on Contracts for
the International Sale of Goods: Justifying Beijing Metals & Minerals
Import/Export Corp. v. American Business Center, Inc., 1995 BYU
L. Rev. 1347. Moore argues that the parol evidence rule often
permits the admission of evidence discussed in article 8(3), and that
the rule could be an appropriate way to discern what consideration
is “due” under article 8(3) to evidence of a parol nature. Id. at 1361-
63. He also argues that the parol evidence rule, by limiting the
incentive for perjury and pleading prior understandings in bad faith,
promotes good faith and uniformity in the interpretation of contracts
and therefore is in harmony with the principles of the CISG, as
expressed in article 7.18 Id. at 1366-70. The answer to both these
arguments, however, is the same: although jurisdictions in the
18 Article 7 of the CISG provides in pertinent part: (1) In the interpretation of this Convention, regard is to be had to its international character and to the need to promote uniformity in its application and the observance of good faith in international trade.
(2) Questions concerning matters governed by this Convention which are not expressly settled in it are to be settled in conformity with the general principles on which it is based . . . . CISG, art. 7.
21 United States have found the parol evidence rule helpful to promote
good faith and uniformity in contract, as well as an appropriate
answer to the question of how much consideration to give parol
evidence, a wide number of other States Party to the CISG have
rejected the rule in their domestic jurisdictions. One of the primary
factors motivating the negotiation and adoption of the CISG was to
provide parties to international contracts for the sale of goods with
some degree of certainty as to the principles of law that would
govern potential disputes and remove the previous doubt regarding
which party's legal system might otherwise apply. See Letter of
Transmittal from Ronald Reagan, President of the United States, to
the United States Senate, reprinted at 15 U.S.C. app. 70, 71 (1997).
Courts applying the CISG cannot, therefore, upset the parties'
reliance on the Convention by substituting familiar principles of
domestic law when the Convention requires a different result. We
may only achieve the directives of good faith and uniformity in
contracts under the CISG by interpreting and applying the plain
22 language of article 8(3) as written and obeying its directive to
consider this type of parol evidence.
This is not to say that parties to an international contract for the
sale of goods cannot depend on written contracts or that parol
evidence regarding subjective contractual intent need always
prevent a party relying on a written agreement from securing
summary judgment. To the contrary, most cases will not present a
situation (as exists in this case) in which both parties to the contract
acknowledge a subjective intent not to be bound by the terms of a
pre-printed writing. In most cases, therefore, article 8(2) of the CISG
will apply, and objective evidence will provide the basis for the
court's decision. See Honnold, Uniform Law § 107 at 164-65.
Consequently, a party to a contract governed by the CISG will not be
able to avoid the terms of a contract and force a jury trial simply by
submitting an affidavit which states that he or she did not have the
subjective intent to be bound by the contract's terms. Cf.
Klopfenstein v. Pargeter, 597 F.2d 150, 152 (9th Cir. 1979)
23 (affirming summary judgment despite the appellant's submission of
his own affidavit regarding his subjective intent: “Undisclosed,
subjective intentions are immaterial in [a] commercial transaction,
especially when contradicted by objective conduct. Thus, the
affidavit has no legal effect even if its averments are accepted as
wholly truthful.”). Moreover, to the extent parties wish to avoid parol
evidence problems they can do so by including a merger clause in
their agreement that extinguishes any and all prior agreements and
understandings not expressed in the writing.19
Considering MCC's affidavits in this case, however, we
conclude that the magistrate judge and the district court improperly
granted summary judgment in favor of D'Agostino. Although the
affidavits are, as D'Agostino observes, relatively conclusory and
19 See Ronald A. Brand & Harry M. Fletchner, Arbitration and Contract Formation in International Trade: First Interpretations of the U.N. Sales Convention, 12 J.L. & Com. 239, 252 (1993) (arguing that article 8(3) of the CISG will not permit the consideration of parol evidence when the parties have expressly excluded oral modifications of the contract pursuant to article 29); see also I Albert Kritzer, Guide to Practical Applications of the United Nations Convention on Contracts for the International Sale of Goods 125 (1989) (counseling the use of a merger clause to compensate for the absence of a parol evidence rule in the CISG).
24 unsupported by facts that would objectively establish MCC's intent
not to be bound by the conditions on the reverse of the form, article
8(1) requires a court to consider evidence of a party's subjective
intent when the other party was aware of it, and the Silingardi and
Copelli affidavits provide that evidence. This is not to say that the
affidavits are conclusive proof of what the parties intended. A
reasonable finder of fact, for example, could disregard testimony that
purportedly sophisticated international merchants signed a contract
without intending to be bound as simply too incredible to believe and
hold MCC to the conditions printed on the reverse of the contract.20
Nevertheless, the affidavits raise an issue of material fact regarding
the parties' intent to incorporate the provisions on the reverse of the
form contract. If the finder of fact determines that the parties did not
20 D'Agostino attempts to explain and undermine the affidavit of its representatives during the transaction, by calling Silingardi a “disgruntled” former employee. Appellee's Br. at 11, 39. Silingardi's alleged feelings towards his former employer may indeed be relevant to undermine the credibility of his assertions, but that is a matter for the finder of fact, not for this court on summary judgment.
25 intend to rely on those provisions, then the more general provisions
of the CISG will govern the outcome of the dispute.21
MCC's affidavits, however, do not discuss all of the
transactions and orders that MCC placed with D'Agostino. Each of
the affidavits discusses the parties' subjective intent surrounding the
initial order MCC placed with D'Agostino in October 1990. The
Copelli affidavit also discusses a February 1991 requirements
contract between the parties and reports that the parties
subjectively did not intend the terms on the reverse of the D'Agostino
order form to apply to that contract either. See Copelli Aff. ¶ 12.
D'Agostino, however, submitted the affidavit of its chairman,
21 Article 50, which permits a buyer to reduce payment to a seller who delivers nonconforming goods, and article 39, which deprives the buyer of that right if the buyer fails to give the seller notice specifying the defect in the goods delivered within a reasonable time, will be of primary importance. Although we may affirm a district court's grant of summary judgment if it is correct for any reason, even if not relied upon below, see United States v. $121,100.00 in United States Currency , 999 F.2d 1503, 1507 (11th Cir. 1993), and the parties have touched upon these articles in their briefs, they have not provided us with sufficient information to resolve their dispute under the CISG. MCC's affidavits indicate that MCC may have complained about the quality of the tile D'Agostino delivered, but they have provided no authority regarding what constitutes a reasonable time for such a complaint in this context. Accordingly, we decline to affirm the district court's grant of summary judgment on this basis.
26 Vincenzo Maselli, which describes at least three other orders from
MCC on form contracts dated January 15, 1991, April 27, 1991, and
May 4, 1991, in addition to the October 1990 contract. See Maselli
Aff. ¶ 2, 25. MCC's affidavits do not discuss the subjective intent of
the parties to be bound by language in those contracts, and
D'Agostino, therefore, argues that we should affirm summary
judgment to the extent damages can be traced to those order forms.
It is unclear from the record, however, whether all of these contracts
contained the terms that appeared in the October 1990 contract.22
Moreover, because article 8 requires a court to consider any
“practices which the parties have established between themselves,
usages and any subsequent conduct of the parties” in interpreting
contracts, CISG, art. 8(3), whether the parties intended to adhere to
the ten day limit for complaints, as stated on the reverse of the initial
22 The Maselli affidavit claims that at the February 4, 1991 contract contained the terms in question, see Maselli Aff. ¶¶ 5-6, but MCC argues that at least some of the forms were never translated into English and, therefore, the record does not reveal whether the terms appear in all the contracts. We leave the resolution of these matters to the district court on remand.
27 contract, will have an impact on whether MCC was bound to adhere
to the limit on subsequent deliveries. Since material issues of fact
remain regarding the interpretation of the remaining contracts
between MCC and D'Agostino, we cannot affirm any portion of the
district court's summary judgment in D'Agostino's favor.
CONCLUSION
MCC asks us to reverse the district court's grant of summary
judgment in favor of D'Agostino. The district court's decision rests
on pre-printed contractual terms and conditions incorporated on the
reverse of a standard order form that MCC's president signed on the
company's behalf. Nevertheless, we conclude that the CISG, which
governs international contracts for the sale of goods, precludes
summary judgment in this case because MCC has raised an issue
of material fact concerning the parties' subjective intent to be bound
by the terms on the reverse of the pre-printed contract. The CISG
also precludes the application of the parol evidence rule, which
28 would otherwise bar the consideration of evidence concerning a
prior or contemporaneously negotiated oral agreement. Accordingly,
we REVERSE the district court's grant of summary judgment and
REMAND this case for further proceedings consistent with this
opinion.