March 19, 2020

Laclede Gas Co. v. Amoco Oil - 522 F.2d 33 (1975)

Facts: Amoco Agreed to deliver propane from Laclede to Laclede customers. Their contract gave Laclede the option to get out with 30 days notice if the distribution system was converted to natural gas. There was no agreement for Amoco to get out of the contract. At one point Amoco was experiencing a shortage of propane and and reduced what Laclede was receiving to 80%. Then Amoco notified Laclede that it would be increasing the price of the propane. When Laclede demanded an explanation Amoco simply canceled the contract. 

Procedural History: The district court ruled in that the contract was invalid. 

Issue: Did the fact that one party had a way to get out of the contract void the contract? 

Holding: No 

Rationale: The contract was specific enough to determine the responsibilities of each party. The contract falls within the category that it is appropriate to follow the rules of specific performance. 

Disposition: Reversed and Remanded. The district court should grant specific performances.