Internatio-Rotterdam, Inc. v. River Brand Rice Mills, Inc.

259 F.2d 137 (1958), cert. denied, 358 U.S. 946 (1959)

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Nature of the Case

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Facts

River Brand (D) contracted with Internatio-Rotterdam (P) for the sale of 95,600 pockets of rice in July 1952 to be delivered alongside ship at Lake Charles or Houston, Texas. at $8.25 per pocket. Delivery was for the month of December and payment was to be secured by a letter of credit on P’s behalf. P, which had already committed itself to supplying rice to a Japanese buyer, was unexpectedly confronted with U.S. export restrictions upon its December shipments. December is a peak month in the rice and cotton seasons in Louisiana and Texas and D became concerned about shipping instructions under the contract because congested conditions prevailed at both the mills and the docks. P elected to deliver 50,000 pockets at Lake Charles and notified D. December 17 was the last date in December which would allow D the two-week period provided in the contract for delivery of the rice to the ports and ships designated. On December 17, D had still received no shipping instructions for the 45,600 pockets destined for Houston. On the morning of the 18th, D rescinded the contract for the Houston shipments but still made the Lake Charles deliveries. One of the reasons for the prompt cancellation was a rise in the market price of rice. It went to $9.75 per pocket. P sued for refusal to deliver the Houston quota. The trial court dismissed the complaint. P appealed.