Columbia Nitrogen Corp. v. Royster Co.

Facts

In 1966, Plaintiff, a manufacturer of mixed fertilizer, built a phosphate production facility and contracted to sell Defendant a minimum of 31,000 tons of phosphate per year at a fixed price for a period of three years. Phosphate prices fell dramatically, leaving Defendant unable to resell the phosphate at a price to recoup the fixed price it had agreed to pay Plaintiff. Defendant subsequently ordered significantly less than the scheduled amount of phosphate during the first year. Plaintiff sued Defendant for breach of contract and Defendant argued that extrinsic evidence, such as trade usage or course of dealing, should be admitted to supplement the written contract between the parties. The trial court ruled that under the parol evidence rule, extrinsic evidence offered by Defendant was inadmissible to supplement the agreement because the parties had a valid contract with terms that were express, plain, and unambiguous. Defendant appealed to the Court of Appeals for the Fourth Circuit for relief.