652 F2d 2 Mobil Oil Corporation v. Clark

652 F.2d 2

1981-1 Trade Cases 64,115

James CLARK, d/b/a Jim's Service Center, Appellee.

No. 80-1858.

United States Court of Appeals,
Eighth Circuit.

Submitted June 15, 1981.
Decided June 24, 1981.

Fred Leicht, Jr., John H. Quinn, III, St. Louis, Mo., for appellant; Armstrong, Teasdale, Kramer & Vaughan, St. Louis, Mo., Nelson S. Anthony, argued, Jeffrey C. Danek, O'Hare, AMF, Ill., of counsel.

James R. Wyrsch, argued, James K. Oppenheimer, Koenigsdorf, Kusnetzky & Wyrsch, Kansas City, Mo., for appellee.

Before ROSS and ARNOLD, Circuit Judges, and HANSON, District Judge.*


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Mobil Oil appeals from the order of the district court 496 F.Supp. 1321 enjoining it from terminating the one-year trial franchise of service station operator James Clark. We affirm the granting of the injunction.


Clark completed Mobil Oil's dealer training school in 1979 and thereafter entered into a trial franchise agreement with Mobil Oil on May 14, 1979. On February 7, 1980, Mobil notified Clark that his trial franchise would not be renewed. In an effort to comply with the provisions of the Petroleum Marketing Practices Act (PMPA), 15 U.S.C. § 2804(c)(3), which requires that the notification of nonrenewal "shall contain * * * a statement of intention to terminate the franchise or not to renew the franchise relationship, together with the reasons therefor," Mobil offered the following explanation:


The reason or reasons for our non-renewal decision are that Mobil has determined that it does not wish to continue its franchise relationship with you.


Clark filed a complaint in state court alleging that Mobil's termination of the trial franchise agreement was ineffective under Missouri law. Mobil Oil filed a counterclaim seeking ejectment. Although Mobil subsequently removed the case to federal district court, Clark never amended the complaint to include any federal grounds for relief.


Following the bench trial, the court issued its Memorandum and Judgment of August 4, 1980. Judge Regan denied relief to Clark on the state common law grounds alleged in his complaint, but found that the so-called "reason" given by Mobil for its nonrenewal of the trial franchise did "not conform to the notification requirements of Section 2804(c)" of the PMPA. Clark was granted equitable relief pursuant to 15 U.S.C. § 2805 of the PMPA. Mobil's counterclaim was denied.


In a post-trial motion for relief from the judgment, Mobil challenged, among other things, the trial court's sua sponte interjection of an issue which was not pleaded or contested by the plaintiff, the trial court's interpretation of the notice requirement of the PMPA and the court's granting of equitable relief on a legal theory which the plaintiff had failed to raise. Mobil's contentions were carefully reviewed by Judge Regan and its motion was denied in a Memorandum and Order of September 5, 1980.


We have considered Mobil's contentions on appeal and have reviewed the record and arguments of the parties. We conclude that the issues raised by Mobil were correctly decided by the district court in its consideration of Mobil's post-trial motion. Accordingly, we affirm the decision of the district court on the basis of the court's Memorandum and Order of September 5, 1980, pursuant to Rule 14 of the Rules of this court.

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The Honorable William C. Hanson, Senior United States District Judge for the Southern District of Iowa, sitting by designation


The Honorable John K. Regan, United States District Judge for the Eastern District of Missouri, Eastern Division