Please explain if you supporting either the plaintiff or the defendant based on the facts of the case and your interpretation of the law? Do you think that oral side promises are often made outside of written contracts? If the "long haul" oral promise had been made by PPC, would it have been ethical for the company to not honor it?

Case10.2Federal Court Case Parol Evidence Rule

Facts

Pilgrim's Pride Corporation (PPC) operated a chicken processing plant in Clinton, Arkansas. PPC contracted with more than 100 chicken growers to supply the plant with poultry. The growers received chicks and feed from PPC, then raised the chicks to maturity and sold them to PPC at a price based on weight. Each grower signed the same boilerplate contract provided by PPC. The contract specified that it was "to continue on a flock to flock basis." The contract stated that either party could terminate the contract without cause between flocks, which lasted between 4 and 9 weeks, and that PPC could end the agreement at any time for "cause or economic necessity." The contract included a merger clause representing that the contract "supersedes, voids, and nullifies" all prior agreements and oral statements, and a clause preventing oral modification of the contract.

Citing economic factors caused by an increase in the cost of chicken feed and a drop in the price of chickens, PPC idled the Clinton plant and terminated its contracts with the chicken growers. The growers sued PPC, contending that PPC officials had made oral representations that the company would maintain a long-term relationship with them and that PPC assured them that PPC "was here for the long haul." The U.S. district court held that the written contracts barred the growers' claims against PPC based on alleged oral promises. The growers appealed.

Issue

Do the contracts signed by the growers bar their claims of oral promises made by PPC?

Language of the Court

Here, the contracts between PPC and the growers bar the growers' claims because the contracts and the claims cover the same subject matter: the duration of the agreements. The essence of PPC's alleged oral representationsfor example, to commit to the growers "for the long haul"is the promise of a long-term relationship. The plain language of the contracts, however, specifies and is sure that the agreements between PPC and the growers are to "continue on a flock to flock basis"a time-period spanning between four and nine weeks. In sum, the contracts between PPC and the growers bar PPC's oral promises because the contracts address the same subject matter as the growers' claims.

Decision

The U.S. court of appeals affirmed the district court's ruling in favor of PPC.

Thank you