cstr

Bolin Farms v. American Cotton Shippers Association
U.S. District Court, Western District of Louisiana, 1974
370 F.Supp. 1353

1. FACTS

Bolin Farms is the Plaintiff including many experieced farmers, and American Cotton Shippers Association is the Defendant. The Plaintiff sued the Defendant for a declaratory judgment of invalidity of their purchase contracts in the U.S. District Court for the Western District of Louisiana.

The Plaintiff and the defendant had a contract between Jan. 9, 1973 and Mar. 29, 1973 where the Plaintiff should sell and deliver to the Defendant all of the cotton raised and harvested on the designated acreage. The contract was negotiated prior to planting.

Because the Plaintiff expected the price of the cotton would go higher, the Plaintiff sued the Defendant to invalidate the contract. However, the court ruled in favor of the Defendant.

2. ISSUE: Is the validity of a contract concerned with the market change after the date of the contract?

3. HOLDING: No.

4. RATIONALE

Once the Plaintiff sells cotton to the Defendant, the Defendant starts to bear his own risk because the Plaintiff does not guarantee quality and quantity. The Defendant then sells at a price where he can make a profit concerning his expectable costs. If the invalidity of the contract is allowed, the Defendant can also be against the contract for his financing. Thus, there is no argument that it does give the Plaintiff, the grower a very real limitation of risk.