Nanakuli Paving & Rock Co. v. Shell Oil Co.
United States Court of Appeals for the Ninth Circuit
664 F.2d 772 (9th Cir. 1981)
Nanakuli Paving & Rock Co. (Nanakuli) (plaintiff) entered into two long-term contracts with Shell Oil Co. (Shell) (defendant) to purchase all the asphalt it required. The contracts set the price as the price posted by Shell at the time of delivery. For several years Shell maintained the same price for Nanakuli, though it increased prices for other customers. Nanakuli brought suit when Shell later increased the price, claiming that under customary trade practices in the Hawaiian asphalt industry there was an implied requirement that Shell protect prices. In support of this assertion Nanakuli identified the routine use of price protection by asphalt suppliers. Shell however claimed that no such customary trade practice existed and that the contract terms controlled the price. Nanakuli appealed from a jury verdict in Shell’s favor.
Rule of Law
Holding and Reasoning (Hoffman, J.)
Concurrence (Kennedy, J.)
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