Contracts: A Sushi Bar Question

For your enjoyment–(and by enjoyment I mean realization that you made a good choice not going to law school)–I will occassionally share food-related questions that pop up on my bar review. This one came last week at the PMBR and was the 35th question in the contracts section. I’m curious to see how non-legal-minds would answer this intuitively, so post your answers and your reasoning and I’ll come back atchya with the real answer tomorrow afternoon/night [and current lawyers or law students can’t play!]:

Toshi is the owner of Hama, a sushi restaurant in Venice. Toshi contracted in writing with Fishco, a fish distributor, to buy 50 pounds of touro (which is a yellow fin tuna). At the time the contract was signed, Toshi orally said to Fishco, “We do have an understanding that Kifune, our chef, must approve the quality of the fish before I will pay you.” Fishco acknowledged Toshi’s request and responded, “If you say so.”

Thereafter, Fishco delivered the yellow fin tuna to Toshi. After inspecting the fish, Kifune refused to give his approval because the touro was spotted instead of its customary shiny skin. As a result, Toshi refused to accept and pay for the fish.

35. Fishco brought a breach of contract action against Toshi because he refused to pay for the fish delivery. How should the court rule on Toshi’s offer to prove, over Fishco’s objection, that Kifune refused to approve the touro that was delivered?

(A) The evidence is admissible to show frustration of purpose.

(B) The evidence is admissible to show that the written agreement was subject to an oral condition precedent.

(C) The evidence is barred because the written contract appears to be a complete and total integration of the parties’ agreement.

(D) The evidence is barred because the oral agreement is within the statute of frauds.

13 comments

  1. I’m also uncertain of the current law regarding oral contracts in Italy, although I believe it was generally more prevelant there… B.

  2. I’d say C. I hear about oral agreements on TV shows and whatnot but I work for a homebuilder. If it’s not written down what you have agreed to matters not when the courts get involved.

    Your question appears to be worded so that the contract was complete and the restaurant owner verbally threw this in at signing.

  3. I think it’s B, as well. I’m not sure what all the legalese means, but I don’t think it’s D because it doesn’t sound like there was any fraudulent activity going on (or, at least, no fraudulent activity intended by either party). I don’t think it’s C because the contract doesn’t seem to be a complete and total integration of the parties’ agreement: arguably, Fishco did agree (or, at least, did not clearly disagree) to a quality check by Kifune. That leaves A and B, and B sounds better to me. Maybe that’s because I can’t exactly define what “frustration of purpose” is. At any rate, although the quality check was orally agreed upon, and not included in the written contract, I think the court could rule that the quality check was an oral condition.

  4. I would say C, following similar reasoning as Kat above, but in a perfect world, it’d be B.

    In their breach of contract suit, is Fishco alleging that Toshi added no such oral condition to their contract?

    And Toshi should have gotten it in writing.

  5. ‘Fishco acknowledged Toshi’s request and responded, “If you say so.” I’d say B.

    Memo to Toshi: Get it in writting. :-D

  6. I’m gonna say C, just because I seem to recall that oral contracts are only applicable in absence of other contracts. I’ll admit to a slight bit of cheating, as I had to look up “frustration of purpose.” Would that make me a better lawyer or a worse one? :)

    BTW, love your blog. Never stop posting the full text to the RSS feed. Please!

  7. Should be B, but I’m going with C. From the simplistic wording of the question, you know that the two parties knew exactly what was meant. In the real world, we leave a meeting of 6 people with 4 different ideas of what was discussed and what decisions were made. If something is in writing, you have to have it all in writing.

  8. I choose C. That’s the reason for the written contract in the first place. I don’t think that you can have an oral addendum to a written agreement. Then again…. I didn’t go to law school.

  9. Very impressive, group. You narrowed it down to B & C, and the correct answer was B. Not bad for people who didn’t spend $100,000 on a legal education!

    Here’s the explanation according to the book: “This Multistate question presents an interesting interplay between Contracts and Evidence. Frequently, parol evidence questions will involve the admissibility of an oral condition. Where the parties agree that a condition precedent must occur before the contract is effective, it is generally agreed that the failure of the condition to occur may be shown despite what otherwise would be deemed a total integration. Thus, even if there is a merger clause, it may be shown that the instrument was handed over to another with an oral condition attached to delivery. The theory is that the agreement is not to take effect until the condition occurs and thus there is no contract to be added to or contradicted until that time. In this Multistate hypo, Toshi will be permitted to introduce evidence of Kifune’s refusal to approve the fish since the agreement was subject to this condition precedent.”

  10. You’re studying for the bar in NYState right?

    IANAL, but I do remember reading somewhere that verbal contracts are legally binding in NY, therefore my guess was originally B.

    Go me? Or something. Cool question to post though! :^)

  11. Multistate hypo? sounds like a disease, maybe those spots that the fish got.

    and i was gonna say B too.

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