Coast Trading Co., Inc. v. Pacific Molasses Co., Etc.

Pacific Molasses Co., dba Berger & Plate, brought this appeal after the district court vacated the arbitrator’s award and granted damages to Coast Trading Co. in their breach of contract action.

I. BACKGROUND

This is a diversity action involving a contract between Coast, the buyer, and Berger & Plate, the seller. Coast was to buy 2200 bags of peas from Berger & Plate, delivery to be made FOB Portland or Seattle in October/November 1973. The parties are members of the Pacific Northwest Pea Growers and Dealers Association, Inc. (PNWPA), now known as the American Dry Pea & Lentil Association. The PNWPA promulgates trade rules under which most of the sales in the industry are conducted. Both parties cite to the Trade Rules and it is admitted the contract between them incorporated the Trade Rules.

The rules provide definitions for commonly used terms and establish courses of conduct. The rules also provide for dispute resolution in the form of arbitration.

II. FACTS

In November 1973, Coast issued shipping instructions altering the original contract, requesting bulk shipment to Spokane. Berger & Plate rejected these instructions in December, and requested advance payment for the…