Sinclair Refining Co. v. Southern Coast Corp.

• Decision Date: 08 May 1952
• Docket Number: No. 13706.,13706.
• Citation: 195 F.2d 626
• Parties: SINCLAIR REFINING CO. v. SOUTHERN COAST CORP.
• Court: U.S. Court of Appeals — Fifth Circuit

195 F.2d 626 (1952)

SINCLAIR REFINING CO. v. SOUTHERN COAST CORP.

No. 13706.

United States Court of Appeals, Fifth Circuit.

April 5, 1952.

Rehearing Denied May 8, 1952.

Carlisle Cravens, Sloan Blair, Ft. Worth, Tex., Allen V. Davis, Corpus Christi, Tex., for appellant.

J. Hart Willis, William A. Rembert, Jr., Dallas, Tex., Harvie Branscomb, Jr., Corpus Christi, Tex., for appellee.

Before HOLMES, RUSSELL, and RIVES, Circuit Judges.

HOLMES, Circuit Judge.

This is the second appeal of this case; our former opinion is reported in 181 F. 2d 960. On the first appeal, the cause was remanded for determination of the issue of fact as to whether the Sinclair Prairie Oil & Gas Company (not a party litigant) was in fact a gas pipe line distributing company, which issue was sought to be raised by appellee by an amendment to its pleadings. On remand, the amendment was made, a second trial was had, and the court submitted the following special issues to a jury with the result stated:

"Question No. 1: Do you find from a preponderance of the evidence that Sinclair Prairie Oil Company was a reputable, responsible, and then existing gas pipe line distributing company during the last three (3) months of the year 1945? Answer `Yes\' or `No.\'

"Answer: Yes.

"Question No. 2: Do you find from a preponderance of the evidence that the plaintiff waived any right it might have had of refusal to sell gas to defendant on the same terms that defendant contemplated buying from Sinclair Prairie Oil Company? Answer `Yes\' or `No.\'

"Answer: No.

"Question No. 3: Do you find from a preponderance of the evidence that the plaintiff is estopped from asserting that Sinclair Prairie Oil Company was a reputable, responsible, and then existing gas pipe line distributing company? Answer `Yes\' or `No.\'

"Answer: No.

"Question No. 4: What amount of damages, if any, do you find from a preponderance of the evidence plaintiff has sustained by reason of the failure of defendant to take gas from plaintiff during the period of December 31, 1945, through December 31, 1951? Answer in dollars and cents.

"Answer: $92,664.00." (R. 663,664.)

The prolixity of the pleadings in this case makes it almost impossible for this court to extract the issues from the plaintiff's complaint, first amended complaint, second amended complaint, first supplemental complaint, third amended original complaint, Exhibits A, B, C, D, E, F, G thereto, and defendant's answer to plaintiff's third amended original complaint, which was filed subject to its motion to strike portions of the complaint; but, on the second trial, in appellant's statement of the case to the jury, it was admitted that the contract sued on consisted of three letters between the appellee and the Terminal Refining Company, the liabilities and obligations of which were assumed by appellant when it bought the assets of said Terminal Company. In this statement to the jury, it was further admitted that this contract gave appellee the right to have submitted to it a bid from a company of the kind described in the contract, that is, a gas pipe line distributing company, competing in business with the Southern Coast Corporation; but the appellant denied that the Sinclair Prairie Oil Company was or had been a gas pipe line distributing company within the legal terminology of the contract. Appellant contended that, while it had the necessary gathering lines to take wet gas from its wells in the field to its plant to be processed into gasoline, and a residue line to carry the dry gas back to the edge of its leases, this gathering system and residue line were necessarily incidental to the operation of its production plant and facilities, although there were lines of pipe, one after another, ranging in size from 9 inches to 3½ feet.

The issue for the jury, as to liability, was whether this operation of the Sinclair Prairie Company constituted engaging in the business of a gas pipe distributing company under the terms of the contract as contemplated by the parties. Did the sale of gas to the ...