Fornaris v. Ridge Tool Co, No. 541

CourtUnited States Supreme Court
Writing for the CourtPER CURIAM
Citation27 L.Ed.2d 174,400 U.S. 41,91 S.Ct. 156
PartiesArturo FORNARIS v. The RIDGE TOOL CO. et al
Decision Date23 November 1970
Docket NumberNo. 541

400 U.S. 41
91 S.Ct. 156
27 L.Ed.2d 174
Arturo FORNARIS

v.

The RIDGE TOOL CO. et al.

No. 541.
Nov. 23, 1970.*

PER CURIAM.

In 1964 by Act No. 75, the Legislature of Puerto Rico enacted the Dealer's Contract Law which in effect provides that a Puerto Rican dealer's contract with a manufacturer, regardless of any provisions for termination, is renewable indefinitely at the option of the local dealer unless the manufacturer has 'just cause' to terminate. Section 1(d) defines 'just cause' as 'nonperformance of any of the essential obligations of the dealer's contract, on the part of the dealer, or any action or omission on his part that adversely and substantially affects the interests of the principal or grantor in promoting the marketing or distribution of the merchandise or service.' If a manufacturer terminates for any other reason he is liable for substantial damages.

This cause was brought by a dealer in a Puerto Rican court for damages for breach of his distributorship contract against Ridge Tool Co., an appellee. It was

Page 42

removed to the Federal District Court on the basis of diversity of citizenship. That court denied the motion to dismiss which claimed that the Dealer's Contract Law upon which the complaint was based was unconstitutional. The Court of Appeals allowed an interlocutory appeal and held the Dealer's Contract Law unconstitutional. 423 F.2d 563.1

The relations of the federal courts to Puerto Rico have often raised delicate problems. It is a Spanish-speaking Commonwealth with a set of laws still impregnated with the Spanish tradition. Federal courts, reversing Puerto

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Rican courts, were inclined to construe Peurto Rican laws in the Anglo-Saxon tradition which often left little room for the overtones of Spanish culture. Out of that experience grew a pronouncement by this Court that a Puerto Rican court should not be overruled on its construction of local law unless it could be said to be 'inescapably wrong.' See Bonet v. Texas Co., 308 U.S. 463, 471, 60 S.Ct. 349, 353—354, 84 L.Ed. 401.

The question presented here is akin to that question, for we deal with a rather vague Puerto Rican law that the Supreme Court of Puerto Rico has not authoritatively construed.2 Only last Term in Reetz v. Bozanich, 397 U.S. 82, 90 S.Ct. 788, 25 L.Ed.2d 68 we held that a three-judge federal court should not have proceeded to strike down an Alaska law which, if construed by the Alaska Supreme Court, might be so confined as not to have any constitutional infirmity. We said, 'A state court decision here * * * could conceivably avoid any decision under the Fourteenth Amendment and would avoid any possible irritant in the federal-state relationship.' Id., at 86—87, 90 S.Ct. at 790.

In this cause the Court of Appeals held that 'just cause' placed substantial liability on a manufacturer who had contracts that he could have terminated...

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133 practice notes
  • Mariniello v. Shell Oil Co., No. 74--1385
    • United States
    • U.S. Court of Appeals — Third Circuit
    • 14 Febrero 1975
    ...Co., 488 F.2d 816, 819 n. 2 (3d Cir. 1973); Fornaris v. Ridge Tool Co., 423 F.2d 563 (1st Cir.), rev'd per curiam on other grounds, 400 U.S. 41, 91 S.Ct. 156, 27 L.Ed.2d 174 39 Shell also contends that the New Jersey rule constitutes a burden on interstate commerce. Like the due process cla......
  • Gautier Torres v. Mathews, Civ. No. 75-1331.
    • United States
    • United States District Courts. 1st Circuit. District of Puerto Rico
    • 14 Febrero 1977
    ...the United States, see Examining Board v. Flores de Otero, 426 U.S. 572, 96 S.Ct. 2264, 49 L.Ed.2d 65 (1976); Fornaris v. Ridge Tool Co., 400 U.S. 41, 91 S.Ct. 156, 27 L.Ed.2d 174 (1970),1 I do not believe that Congress is required to extend any one particular financial benefit to those loc......
  • Cuesnongle v. Ramos, No. 85-1068
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • 3 Octubre 1985
    ...Co. of Puerto Rico, 478 U.S. 328, 106 S.Ct. 2968, 2976 n. 6, 92 L.Ed.2d 266 (1986) (emphasis added). See also Fornaris v. Ridge Tool Co., 400 U.S. 41, 44, 91 S.Ct. 156, 158, 27 L.Ed.2d 174 We would hope that the distinction between strict statutory construction and constitutional analysis c......
  • U.S. v. Sanchez, No. 90-5749
    • United States
    • United States Courts of Appeals. United States Court of Appeals (11th Circuit)
    • 4 Junio 1993
    ...Amendment rather than Fifth Amendment due process); Fornaris v. Ridge Tool Co., 423 F.2d 563 (1st Cir.), rev'd on other grounds, 400 U.S. 41, 91 S.Ct. 156, 27 L.Ed.2d 174 (1970) 9 Provisions of each act not superseded by the Federal Relations Act of 1950, are codified at 48 U.S.C. § 731 et ......
  • Request a trial to view additional results
133 cases
  • Mariniello v. Shell Oil Co., No. 74--1385
    • United States
    • U.S. Court of Appeals — Third Circuit
    • 14 Febrero 1975
    ...Co., 488 F.2d 816, 819 n. 2 (3d Cir. 1973); Fornaris v. Ridge Tool Co., 423 F.2d 563 (1st Cir.), rev'd per curiam on other grounds, 400 U.S. 41, 91 S.Ct. 156, 27 L.Ed.2d 174 39 Shell also contends that the New Jersey rule constitutes a burden on interstate commerce. Like the due process cla......
  • Gautier Torres v. Mathews, Civ. No. 75-1331.
    • United States
    • United States District Courts. 1st Circuit. District of Puerto Rico
    • 14 Febrero 1977
    ...the United States, see Examining Board v. Flores de Otero, 426 U.S. 572, 96 S.Ct. 2264, 49 L.Ed.2d 65 (1976); Fornaris v. Ridge Tool Co., 400 U.S. 41, 91 S.Ct. 156, 27 L.Ed.2d 174 (1970),1 I do not believe that Congress is required to extend any one particular financial benefit to those loc......
  • Cuesnongle v. Ramos, No. 85-1068
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • 3 Octubre 1985
    ...Co. of Puerto Rico, 478 U.S. 328, 106 S.Ct. 2968, 2976 n. 6, 92 L.Ed.2d 266 (1986) (emphasis added). See also Fornaris v. Ridge Tool Co., 400 U.S. 41, 44, 91 S.Ct. 156, 158, 27 L.Ed.2d 174 We would hope that the distinction between strict statutory construction and constitutional analysis c......
  • U.S. v. Sanchez, No. 90-5749
    • United States
    • United States Courts of Appeals. United States Court of Appeals (11th Circuit)
    • 4 Junio 1993
    ...Amendment rather than Fifth Amendment due process); Fornaris v. Ridge Tool Co., 423 F.2d 563 (1st Cir.), rev'd on other grounds, 400 U.S. 41, 91 S.Ct. 156, 27 L.Ed.2d 174 (1970) 9 Provisions of each act not superseded by the Federal Relations Act of 1950, are codified at 48 U.S.C. § 731 et ......
  • Request a trial to view additional results

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