No matter what line of business you're in, you can't escape sex. That

may have been one conclusion drawn by an American exporter of

meat products after a dispute with a German customer over a shipment

of pork livers. Here's how the disagreement came about.

The American exporter was contracted to ship "30,000 lbs. of

freshly frozen U.S. pork livers, customary merchantable quality,

fi rst rate brands." The shipment had been prepared to meet the exacting

standards of the American market, so the exporter expected

the transaction to be completed without any problem. But when

the livers arrived in Germany, the purchaser raised an objection:

"We ordered pork livers of customary merchantable qualitywhat

you sent us consisted of 40 percent sow livers."

"Who cares about the sex of the pig the liver came from?" the

exporter asked.

"We do," the German replied. "Here in Germany we don't pass

off spongy sow livers as the fi rmer livers of male pigs. This shipment

wasn't merchantable at the price we expected to charge. The

only way we were able to dispose of the meat without a total loss

was to reduce the price. You owe us a price allowance of $1,000."

The American refused to reduce the price. The determined resistance

may have been partly in reaction to the implied insult to the taste of the American consumer. "If pork livers, whatever the

sex of the animal, are palatable to Americans, they ought to be

good enough for anyone," the American thought.

It looked as if the buyer and seller could never agree on eating

habits.

QUESTIONS

1. In this dispute, which country's law would apply, that of the

United States or of Germany?

2. If the case were tried in U.S. courts, who do you think would

win? In German courts? Why?

3. Draw up a brief agreement that would have eliminated the

following problems before they could occur:

a. Whose law applies.

b. Whether the case should be tried in U.S. or German courts.

c. The difference in opinion as to "customary merchantable

quality."

4. Discuss how SRC may be at work in this case.