Amoco Oil Co. v. Gomez
| Decision Date | 19 December 2000 |
| Docket Number | No. 99-1223-CIV.,99-1223-CIV. |
| Parties | AMOCO OIL COMPANY, Plaintiff, v. Caroline GOMEZ, Defendant. |
| Court | U.S. District Court — Southern District of Florida |
Moises Melendez, Heinrich, Gordon, Hargrove, Weihe & James, PA, Ft. Lauderdale, FL, for plaintiff.
Raul E. Garcia, Miami, FL, for defendant.
ORDER ON PLAINTIFF'S MOTIONS FOR SUMMARY JUDGMENT
THIS CAUSE is before the court upon the plaintiff's, Amoco Oil Company ("Amoco"), motions for summary judgment (DE # 102, 103). Amoco filed a complaint against the defendant, Caroline Gomez ("Gomez"), alleging two counts of breach of contract that stemmed from the parties' Commission Marketer contracts. According to Amoco, Gomez breached their agreements by failing to pay all the commission receipts owed to Amoco and by closing down her gas station. Gomez filed a counterclaim against Amoco for fraud in the inducement (count I), breach of fiduciary duty (count II), and breach of contract (count III). Gomez alleges that after she took possession of the gas station, she learned that there were environmental problems that had to be fixed, Amoco was aware of these problems before Gomez purchased the station, Amoco promised to remedy them, and Amoco never fulfilled its promises. The court has subject matter jurisdiction by virtue of diversity jurisdiction, and there is no dispute that this case is governed by Florida substantive law. See Sierminski v. Transouth Fin. Corp., 216 F.3d 945, 950 (11th Cir.2000).
Amoco has filed two motions for summary judgment. The first motion seeks partial summary judgment on Amoco's breach of contract claims (DE # 102). Amoco's second motion seeks summary judgment on Gomez's counterclaims (DE # 103). The court heard oral argument on both motions on October 27, 2000. After carefully considering the pleadings and the arguments of counsel, the court denies Amoco's motion for summary judgment on its breach of contract claims and grants in part Amoco's motion for summary judgment on Gomez's counterclaim.
Gomez began operating Amoco's gas station in March of 1997, when her corporation (Rocabaja Corp.) purchased the station from a third party (Gemar Service Station, Inc.). On March 12, 1997, Gomez entered into a one-year Trial Franchise Lease with Amoco. See Pl.Ex. 1A. This agreement was followed by an extended three-year lease in January of 1998. See Pl.Ex. 1B. Before the expiration of the January agreement, the parties entered into a mutual cancellation of that agreement and executed the contracts that are the subject of this dispute. These contracts are the Commission Marketer Lease and the Commission Marketer Agreement, which were executed on September 17, 1998. See Pl.Ex. 1E, 1F.2 These agreements were to govern the parties for four years.
Under these contracts, Gomez became an independent contractor engaged in selling fuel owned by Amoco at 7070 West Flagler Street, Miami, Florida. The Commission Marketer Lease obligated Gomez to pay Amoco rent of $2,960 per month for four years and to maintain the gas station open for business twenty-four hours per day, seven days per week, including holidays. See Pl.Ex. 1E, ¶¶ 4C, 12A. Under the parties' preexisting franchise agreement Gomez would purchase fuel from Amoco and sell it at her station at whatever price she chose to set. During oral argument, the parties explained how Gomez's obligations changed when she became a commission marketer. Under the Commission Marketer Agreement, Amoco would deliver fuel to Gomez at no cost to her. The fuel would be sold to customers at a price set by Amoco, and only then would Gomez remit the proceeds of the sale to Amoco, less a 3.4 cents per gallon commission for herself. Amoco would withdraw these proceeds electronically from Gomez's account. The Commission Marketer Agreement obligated Gomez to properly and promptly account to Amoco for all gross receipts and to maintain the gas station open for business twenty-four hours per day, seven days per week, including holidays. See Pl.Ex. 1F, ¶¶ 1-2, 7, 10, 23A(7), 26. Prior to executing these agreements, Gomez had forty-two days to review them.3 She also signed a Franchise Disclosure Questionnaire, which indicated that she had reviewed the agreements but did not understand all of their provisions. See Pl.Ex. 1H. Whether or not Gomez discussed the risks and benefits of the agreements with her accountant and/or attorney is disputed by the parties. See Pl.Ex. 1H; C. Gomez Depo. at pp. 136-37.
Amoco claims that Gomez breached the agreements in several ways. As for the Lease, Gomez failed to pay rent since March of 1999, when she closed down and abandoned the gas station. Amoco alleges that Gomez breached the second agreement by failing to pay Amoco all of the commissions due to it, failing to promptly and properly account for all gross receipts, and closing down and abandoning the gas station prior to the expiration of their agreements. Amoco also claims that Gomez retained proceeds from gas sales in the amount of $37,1182.27. See Pl.Compl., Ex. D.
With the exception of the amount of commission allegedly withheld by Gomez, Gomez does not dispute any of the allegations discussed in the preceding section. Instead she claims that Amoco made two major misrepresentations. First, it failed to inform her that the gas station she purchased did not comply with environmental regulations. Second, it promised to repair fuel dispensing equipment that became defective, but it never completed the repairs successfully. According to Gomez, these facts justify her abandonment of the gas station and failure to pay Amoco the commissions due under their agreements. Gomez also argues that these facts entitle her to relief under her counterclaim.
When Gomez began operating the gas station, she believed that the site was in good order, and she acknowledged this in her original lease with Amoco. See Pl.Ex. 1A, ¶ 9. On June 3, 1997, however, less than one month after Gomez began operating the gas station, inspectors from the Miami-Dade Department of Environmental Resource Management ("DERM") arrived at the premises to conduct environmental tests, which revealed that the gas station did not comply with applicable regulations. See Def.Ex. T. Although Gomez was not aware that an inspection would be conducted nor that the station had failed to comply with environmental regulations in the past, a DERM inspector told Gomez that Amoco had known about this before she had purchased the gas station. See C. Gomez Depo. at p. 65. In fact, the record establishes that Amoco knew that environmental problems (such as soil contamination by leaking gasoline and vapor recovery problems) had existed on the site since 1989. See Def.'s Ex. H, FF; Coil Depo. at pp. 47, 52-54, 63-68, 75, 94-95; Wong Depo. at pp. 8-9. Amoco had been corresponding with DERM and environmental consultants about these problems since November of 1995.
When Gomez informed Amoco of the test results, Amoco told Gomez that the gas station would need to undergo construction for the purposes of installing a vapor recovery system. See C. Gomez Depo. at pp. 62-63; Alvear Depo. at p. 33. The construction at the gas station was extensive, and it caused Gomez to close the business for one month. See C. Gomez Depo. at p. 45. Once the construction was completed in September of 1997, Gomez noticed that the gas pumps had been adversely affected. They often would pump gas slowly or stop pumping altogether. Prior to the construction, Gomez had experienced no problems dispensing fuel. As a result of the pumps' defects, customers often would complain, insult the employees, and demand that their money be returned. See C. Gomez Depo. at pp. 101, 104. Gomez continued to lose business over time, and, despite her complaints to Amoco, the equipment's problems were not remedied. Amoco claims that the pump defects eventually led her to close the gas station on March 31, 1999.
As soon as Gomez became aware of the pump defects, she contacted Amoco. Gomez claims that in September of 1998, Alex Escardo, an Amoco representative, told her that if she would sign the agreements that are the subject of this dispute, Amoco would fix the problem at her station and she would be permitted to keep her lease incentives (a rent of $2,960 per month instead of $7,229 per month). See C. Gomez Depo. at p. 87; Escardo Depo. at pp. 22, 25. Although the maintenance of the underground equipment was Amoco's responsibility under the Commission Marketer Agreement, Amoco was not able to remedy the problem successfully,4 and, to date, it has not attempted find anyone to operate the station. See Def.Ex. W; Moran Depo. at p. 25.
Rule 56(c) of the Federal Rules of Civil Procedure authorizes summary judgment where the pleadings and supporting materials show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The court's focus in reviewing a motion for summary judgment is "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. Sept. 1997). The moving party has the burden to establish the absence of a genuine issue as to any material fact. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970); Tyson Foods, Inc., 121 F.3d at 646. Once the moving party has established the absence of a genuine issue of material fact, to which the nonmoving party bears the burden at trial, it is up to the nonmoving party to go...
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