Mobil Oil Corp. v. Rubenfeld

• Decision Date: 04 January 1974
• Citation: 77 Misc.2d 962,357 N.Y.S.2d 589
• Parties: , 1974-1 Trade Cases P 75,066 MOBIL OIL CORPORATION, Petitioner-Landlord-Appellant, v. Paul RUBENFELD, Respondent-Tenant-Respondent.
• Court: New York Supreme Court

Page 589

357 N.Y.S.2d 589

77 Misc.2d 962, 1974-1 Trade Cases P 75,066

MOBIL OIL CORPORATION, Petitioner-Landlord-Appellant, v. Paul RUBENFELD, Respondent-Tenant-Respondent.

Supreme Court, Appellate Term, Second and Eleventh Judicial districts.

Jan. 4, 1974.

Bleakley, Platt, Schmidt & Fritz, White Plains (Frederick J. Martin, White Plains, of counsel), for appellant.

Anderson, Povman & Warren, Forest Hills (Morton Povman, Forest Hills, of counsel), for respondent.

Louis J. Lefkowitz, Atty. Gen. (Samuel A. Hirshowitz, Charles A. LaTorella, Jr., and Peter A. Berkowsky, Asst. Attys. Gen., of counsel), amicus curiae.

Before CROAT, P. J., and SCHWARTZWALD and MARGETT, JJ.

PER CURIAM.

Petitioner Mobil Oil Corporation brings this summary holdover proceeding to recover possession of a gasoline station from the respondent-dealer, pursuant to a contractual option to terminate the lease and retail dealer agreement. Respondent alleges, as an affirmative defense, inter alia, that the petitioner sought to fix and control the retail price of gasoline through means of coercion, which took the form of threatened cancellation of his lease. At the trial, respondent raised the additional issue that he was coerced by means of comparable threats, into purchasing tires, batteries and accessories (TBA) designated by petitioner.

Such attempts at retail price fixing and compulsory purchase of a lessor's TBA have been held to violate the anti-trust laws (see Atlantic Refining Company v. F.T.C., 381 U.S. 357, 85 S.Ct. 1498, 14 L.Ed.2d 443; F.T.C. v. Texaco, Inc., 393 U.S. 223, 89 S.Ct. 429, 21 L.Ed.2d 394; Lessig v. Tidewater Oil Company, 9 Cir., 327 F.2d 459; Broussard v. Socony Mobil Oil Company, 5 Cir., 350 F.2d 346). In Lessig v. Tidewater Oil Company, supra, the court specifically found that the termination of a gasoline station lease was unlawful, even though in exercise of a contractual right, where the termination was occasioned by the lessee's refusal to set the retail price of gasoline as directed by Tidewater and to purchase TBA designated by it. In view of these holdings, it is our opinion that the defense proffered by respondent is a viable one.

This determination of viability is supported by the doctrine of retaliatory eviction, as set forth in Edwards v. Habib, 130 U.S.App.D.C. 126, 397 F.2d 687, cert. den., 393 U.S. 1016, 89 S.Ct. 618, 21 L.Ed.2d 560). There it was held that a court should not lend itself to the enforcement of a right to evict where the purpose of exercising the right is an illegal one. While in Edwards the eviction was in retaliation for tenant's reporting of housing violations, a retaliation for a refusal to cooperate in a scheme that has as its object the violation of anti-trust laws, is no less unlawful. On a broader basis, public policy would militate against enforcing a contractual right where it is being exercised in furtherance of an illegal end. In L'Orange v. Medical Protective Company, 6 Cir., 394 F.2d 57, it was held that public policy would preclude upholding the cancellation of an insurance policy, even though there existed a contractual right to do so, where the cancellation was exercised for the purpose of coercing and intimidating the insured (a dentist) as a witness in a pending and in future lawsuits.

We also hold that the Civil Court is not deprived of jurisdiction to hear and resolve the issue, although, since the instant proceeding is limited solely to the award of possession, its determination will not have res judicata effect (Mohar Realty Co. v. Smith, 46 Misc.2d 849, 260 N.Y.S.2d 685; see, also, 29A McKinney's Judiciary Law, Part 3, 1966 Commentary to CCA § 204).

Finally, in view of the unrebutted testimony that a harmonious relationship existed between petitioner and respondent-dealer until the latter's refusal to set his gasoline prices as directed, and to purchase the designated TBA, the finding of the court below upholding the defense interposed, should not be disturbed.

The final judgment, in favor of respondent, is affirmed with $25 costs.

GROAT, P. J., and SCHWARTZWALD, J., concur.

MARGETT, J., dissents and votes to reverse the final judgment and enter judgment for the petitioner, in the following memorandum:

Petitioner seeks to exercise its right not to renew a lease between the parties and to recover possession of the service station leased by respon...