Case Name: Thomas W. BELL, Plaintiff-Appellant, v. EXXON COMPANY, U. S. A., a division of Exxon Corporation, a corporation and Humble Oil & Refining Company, a corporation, Defendants-Appellees
Court: United States Court of Appeals for the Ninth Circuit
Jurisdiction: United States
Decision Date: 1978-05-05
Citations: 575 F.2d 714
Docket Number: No. 75-2513
Parties: Thomas W. BELL, Plaintiff-Appellant, v. EXXON COMPANY, U. S. A., a division of Exxon Corporation, a corporation and Humble Oil & Refining Company, a corporation, Defendants-Appellees.
Judges: 
Reporter: Federal Reporter 2d Series
Volume: 575
Pages: 714–717

Head Matter:
Thomas W. BELL, Plaintiff-Appellant, v. EXXON COMPANY, U. S. A., a division of Exxon Corporation, a corporation and Humble Oil & Refining Company, a corporation, Defendants-Appellees.
No. 75-2513.
United States Court of Appeals, Ninth Circuit.
May 5, 1978.
As Amended May 23, 1978.
Rehearing Denied June 28, 1978.
Stephen T. Mugglebee, National City, Cal., for plaintiff-appellant.
Jack D. Fudge, of McCutchen, Black, Verleger & Shea, Los Angeles, Cal., for defendants-appellees.
Before BROWNING, GOODWIN and KENNEDY, Circuit Judges.

Opinion:
PER CURIAM:
Appellant's first three claims pertain to his primary contention that appellee deprived him of sufficient gasoline supplies unfairly and in derogation of appellant's contractual rights. The district court granted summary judgment on the ground that appellee's failure to deliver on its contractual commitments was excused by virtue of the voluntary allocation program, promulgated under the Economic Stabilization Act of 1970, as amended, 12 U.S.C. § 1904, note (Supp.1977) and the Emergency Petroleum Allocation Act of 1973, as amended, 15 U.S.C. § 751, et seq. (1976). Clearly, the power of federal courts to enforce private contractual agreements is subject to the limitations of public policy expressed in federal statutes. Hurd v. Hodge, 334 U.S. 24, 68 S.Ct. 847, 92 L.Ed. 1187 (1948). Appellant argues that there is a factual dispute as to the fairness of the particular allocation scheme developed by appellee. However, appellant has failed to sustain his burden of submitting affidavits containing facts (not mere allegations) sufficient to rebut appellee's prima facie showing that its allocation program conformed to applicable federal guidelines and regulations. See First National Bank v. Cities Service, 391 U.S. 253, 289, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968); Town House, Inc. v. Paulino, 381 F.2d 811, 814 (9th Cir. 1967).
Appellant's fourth claim alleges fraudulent inducement to enter into the May 17, 1973, sales agreement. Appellant claims reliance on the allegedly false representations of Mr. Apeles, an Exxon sales representative, that despite the anticipated fuel supply shortage appellee would supply appellant's gasoline requirements if he entered into the new agreement. The district court ruled that appellant could not rely on Mr. Apeles' statements because Mr. Apeles did not have actual authority to bind Exxon to supply gasoline in any amount. However, appellant's affidavits raised an issue as to whether Mr. Apeles possessed ostensible authority to bind Exxon in this manner. Cal.Civ.Code § 2317 (West 1954). Under California law, the existence of ostensible authority is a question of fact, Yanchor v. Kagan, 22 Cal.App.3d 544, 550, 99 Cal.Rptr. 367, 371 (1971). Exxon argued below that appellant's fraud claim was barred by the rule excluding parol evidence. Cal.Civ.Code § 1856 (West 1955). The argument is without merit. Although parol evidence is not available to vary the express terms of a written agreement, it is admissible to show fraudulent inducement to enter into a contract, Bank of America v. Lamb Finance Co., 179 Cal.App.2d 498, 3 Cal.Rptr. 877 (1960), "and this is true 'even though the contract recites that all conditions and representations are embodied therein,' " Morris v. Harbor Boat Building Co., 112 Cal.App.2d 882, 888, 247 P.2d 589, 593 (1952), as it does in this case. While it is true that the contract reserves to Exxon the right to make allocation of available gasoline supplies among its customers, appellant alleges that Mr. Apeles represented to him that Exxon would exercise that right in a manner that fully protected his service needs, both because of prior representations and the relatively small amount of gasoline that he required. As such, the oral statements relied upon do not contradict the express terms of the agreement. Simmons v. California Institute of Technology, 34 Cal.2d 264, 274, 209 P.2d 581, 587 (1949) (en banc). Fraud is a question of fact to be determined at trial. It was therefore inappropriate to dispose of appellant's fourth claim by summary judgment.
The district court has jurisdiction of appellant's fourth claim under 28 U.S.C. § 1332(a). Appellant alleged damages in excess of $10,000 because he was fraudulently induced to enter into and perform the contract, and there is diversity of citizenship between the parties.
Summary judgment was properly granted as to appellant's fifth claim. In his fifth claim, appellant seeks to enjoin appellee from evicting appellant from his service station. The district court concluded that the lease and sales agreements between appellant and Exxon were properly terminated under their respective terms. Appellant' has raised no substantial issue of law or material fact to controvert this conclusion.
Affirmed in part, reversed in part, and remanded for further proceedings.