Perry v. Champlain Oil Co.
| Decision Date | 11 July 1955 |
| Citation | 114 A.2d 885,99 N.H. 451 |
| Parties | Richard H. PERRY v. CHAMPLAIN OIL CO., Inc. |
| Court | New Hampshire Supreme Court |
Upton, Sanders & Upton, Richard F. Upton, Concord, for plaintiff.
Wyman, Starr, Booth, Wadleign & Langdell, Philip G. Peters, Manchester, for defendant.
The plaintiff's argument according to his brief is based upon three principal propositions. First, that it is an implied provision of the lease that the defendant will do nothing to materially diminish the value of its performance and this implied provision the defendant has breached. Second, that it is an implied provision of the lease that the defendant will distribute Sunoco Products to the plaintiff's station as a Sun Oil Company station and that the impossibility of so doing gives the plaintiff a right to rescind. Third, that the cancellation of the defendant's distributorship of Sunoco products caused a material commercial frustration of the objectives of the lease, giving rise to a right of rescission.
Taking up these propositions in order, it appears the Trial Court found that the cancellation of the agreement between the defendant and the Sun Oil Company was necessary because of business conditions and that the parties did not intend that the defendant be bound to market Sunoco products exclusively at the plaintiff's station. We believe there was evidence to sustain the finding that the defendant acted reasonably in cancelling its contracts with Sun Oil Company since, among other facts, the latter had made it plain that it was going to cancel its contracts with the defendant and sell gasoline products directly without employing any distributor. The defendant's representative testified as a result of this his company would be 'out of business' unless it could obtain another source of supply. It seems clear that a finding of a breach of the 'implied covenant of good faith and fair dealing' necessary to sustain the plaintiff's position on this issue (Williston on Contracts, § 670, p. 1926) was not compelled.
While it is true that the interpretation of written contracts is for our court, Lynch v. Grundy, 97 N.H. 286, 288, 86 A.2d 114 and cases cited, the writing is to be interpreted in the light of all the surrounding circumstances which are facts to be found by the Trial Court. Irwin v. Blain, 95 N.H. 20, 58 A.2d 618 and cases cited. That Court has found that the terms of the lease did not restrict the defendant exclusively to the sale of Sunoco products and that while the parties intended and expected Sunoco products to be sold, neither 'contemplated a subsequent failure' of the Sunoco supply and the defendant 'could not guarantee' that such products would be supplied to the station during the terms of the fifteen-year lease. These findings are sustainable and in the light of them and other facts we are content with the Trial Court's interpretation that the defendant was not restricted by the lease to sell Sun Oil products exclusively at the plaintiff's station. Hogan v. Lebel, 95 N.H. 95, 58 A.2d 321. Other courts faced with similar situations have come to the same conclusion. Caldwell & Taylor Corporation v. Nieberhelman, 39 Ohio App. 136, 177 N.E. 42; Barnett v. Clark, 225 Mass. 185, 114 N.E. 317. We do not believe there has been such impossibility of performance of the agreement as to give the plaintiff a right to rescind. The authorities cited in his brief on this point make it clear that 'to justify the termination of a contract on account of impossibility of performance, the impossibility must be complete and permanent.' Black on Rescission of Contracts, § 208, p. 586; see also, Williston on Contracts, § 670. The mere fact that the performance on the part of the defendant has lost value is not ground for rescission. Bourn v. Duff, 96 N.H. 194, 72 A.2d 501. 'But the risk of losing the profits of the bargain rests on both parties alike.' Corbin on Contracts, § 1339, p. 315.
The plaintiff also argues persuasively that the doctrine of 'commercial...
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