Legal Question in Business Law in California

Re: Reserving the right to refuse service...

Under the US and CA Constitutions you do not have to serve anyone. Unless you are refusing service because of race, national origin, creed, etc then he has no leg to stand on.

Re: Reserving the right to refuse service...

There is none, as far as I know. But no one should be forced to enter into a transaction with anyone else. The rejected customer probably is blowing a lot of steam.

Re: Reserving the right to refuse service...

You can start by citing the United States Constitution. So long as a business' refusal to do business with someone is not based on race, creed, color, national origin, sex, or some other protected status, business owners do not have to do business with anyone. If government required businesses to do business with others, that would essentially be the same as involuntary servitude, which has been declared to be unconstitutional.

Re: Reserving the right to refuse service...

To start, since the proposed transaction involves interstate commerce, an area in which the U.S. Congress has exclusive jurisdiction to legislate under the U.S. Constitution, this is a matter of federal law and I would start out by telling the would-be customer that no state's small-claims court would be entitled to hear the case, that it would have to be tried in a United States District Court. Now, I don't know without more information whether this is literally true, but there is a good chance that the dispute could be forced into federal court.

More significantly, the small manufacturer-wholesaler would probably win, not because there is a law that permits it to refuse to take on every possible customer, but because there is no law that requires it to accept every possible customer. This is still a country where what is not forbidden is permitted, rather than one where you can only do what some law authorizes!

Obviously, thre are laws that forbid discrimination. These laws forbid discrimination against persons of a protected class, e.g., racial, ethnic, religious and in some cases sexual-preference minorities. It may in some cases be unlawful to discriminate in your pricing unless there is a sound economic basis, e.g. you can charge more to a customer who buys ten widgets that a customer that buys 100 at a time.

However, I have never heard of a law requiring a business to (attempt to) handle more business than it can handle. Hotels turn away wannabe guests when they are full, and rock concerts sell out. If Boeing can build 700 planes a year, they will turn away an order for #701 (or more likely try to get the airline to accept delivery next year).

As long as you aren't practicing some form of discrimination against a protected class, I'd say give her the rock concert, hotel and Boeing examples and let her try to argue her way through those. If that isn't enough, you can think of others, I'm sure, where suppliers of goods and services turn away excess business.

Another possibility - maybe you need to expand!