144 F.3d 1384 (11th Cir. 1998)
MCC-Marble Ceramic Center, Inc., a Florida corporation engaged in the retail sale of tiles, and Ceramica Nuova d’Agostino, S.p.A., an Italian corporation engaged in the manufacture of ceramic tiles, entered into negotiations in October 1990 when MCC’s president Juan Carlos Monzon met D’Agostino’s representatives at a trade fair in Bologna, Italy.1 Monzon, who spoke no Italian, communicated through D’Agostino’s agent Gianfranco Copelli as translator and reached an oral agreement on the terms of price, quality, quantity, delivery, and payment, which the parties then recorded on one of D’Agostino’s standard pre-printed order forms that Monzon signed.2
In February 1991 the parties entered a requirements contract under which D’Agostino agreed to supply MCC with high grade ceramic tile at specific discounts as long as MCC purchased sufficient quantities.3 MCC completed additional order forms on D’Agostino’s pre-printed contracts dated January 15, 1991, April 27, 1991, and May 4, 1991.4 The forms were printed in Italian and contained terms and conditions on both the front and reverse.5 One provision stated that default or delay in payment gives D’Agostino the right to suspend or cancel the contract.6 Another required complaints for defects to be made in writing by certified letter within ten days after receipt.7
MCC brought suit against D’Agostino claiming breach of the requirements contract when D’Agostino failed to satisfy orders in April, May, and August of 1991.8 D’Agostino counterclaimed for damages based on MCC’s alleged nonpayment for deliveries between February 28, 1991 and July 4, 1991 amounting to $108,389.40 and 102,053,846.00 Italian lira.9 MCC submitted three affidavits from Monzon, D’Agostino’s commercial director Gianni Silingardi, and Copelli asserting that the parties subjectively intended not to be bound by the terms on the reverse of the order forms despite the incorporation language on the front.10
The district court granted summary judgment in D’Agostino’s favor on the recommendation of the magistrate judge, and MCC appealed to the United States Court of Appeals for the Eleventh Circuit.11
Whether a court must consider parol evidence in a contract dispute governed by the CISG?12
Article 8(1) of the CISG requires courts to interpret statements and conduct according to a party's intent when the other party knew or could not have been unaware of that intent.13 Article 8(3) directs courts to give due consideration to all relevant circumstances of the case including the negotiations to determine intent.14
Yes. The district court failed to consider the affidavits submitted by MCC when it granted summary judgment to D’Agostino.15 MCC and D’Agostino negotiated at the Bologna trade fair in October 1990, where Monzon reached an oral agreement on price, quality, quantity, delivery, and payment before signing D’Agostino’s pre-printed order form.16 The three affidavits from Monzon, Silingardi, and Copelli establish that the parties subjectively intended the oral terms to control and did not intend the reverse-side provisions to bind them.17
Because article 8(1) mandates inquiry into subjective intent once the other party’s awareness is shown, and the Silingardi and Copelli affidavits confirm D’Agostino’s representatives knew of Monzon’s intent, the court was required to examine this parol evidence rather than limit itself to the written form.18 The magistrate judge and district court instead treated the pre-printed terms as controlling without reference to the parties’ actual understanding, which directly contravenes the CISG’s textual directive to consider negotiations and subjective intent.19
A court must consider parol evidence when it reveals the parties’ subjective intent under the CISG.20
Whether evidence of the parties’ subjective intent not to be bound by terms on the reverse of a pre-printed form raises a genuine issue of material fact?21
Summary judgment is appropriate only when the pleadings, depositions, and affidavits reveal that no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law under Fed. R. Civ. P. 56(c).22
Yes. MCC’s three affidavits directly contradict D’Agostino’s reliance on the reverse-side clauses concerning payment default and the ten-day written-complaint requirement.23 The affidavits state that the parties arrived at an oral agreement on essential terms at the trade fair and then memorialized those terms on the form while subjectively intending that the reverse provisions would not apply.24 Silingardi and Copelli, as D’Agostino’s own representatives, confirm awareness of Monzon’s intent.25
This evidence creates a triable question whether the parties intended to incorporate the pre-printed conditions.26 Although the affidavits are somewhat conclusory, article 8(1) requires their consideration when the counterparty’s knowledge is shown, and a reasonable finder of fact could credit them.27 Therefore the district court erred in holding that no material fact existed.28
Evidence of the parties’ subjective intent not to be bound by the reverse terms raises a genuine issue of material fact precluding summary judgment.29
Whether the parol evidence rule applies to contracts governed by the CISG?30
The CISG contains no express parol evidence rule; instead article 8(3) expressly directs courts to consider all relevant circumstances including negotiations, and article 11 permits contracts to be proved by any means including witnesses.31
No. The parol evidence rule is a substantive domestic doctrine that bars evidence of prior or contemporaneous oral agreements varying the terms of a writing, yet the CISG rejects any such limitation.32 Article 8(3) requires due consideration of negotiations and subsequent conduct, and the drafters deliberately omitted a statute of frauds.33 Applying the parol evidence rule would therefore substitute familiar American contract principles for the Convention’s text, undermining the uniformity the CISG was designed to achieve.34 The Eleventh Circuit correctly declined to follow the contrary dicta in Beijing Metals and instead followed the weight of academic commentary recognizing that article 8(3) overrides domestic parol evidence restrictions.35
Consequently the district court could not invoke the rule to exclude MCC’s affidavits.36
The parol evidence rule does not apply to contracts governed by the CISG.37