Richfield Oil Co. of California v. Hercules Gasoline Co.

Plaintiff sued for an injunction and for an accounting. The interveners entered the litigation for the aid of plaintiff. Judgment went for plaintiff and interveners, awarding them a permanent injunction and damages. The defendants appeal upon a bill of exceptions.

Plaintiff and one Horwitz executed a written contract whereby the former agreed to purchase and the latter agreed to sell and deliver the crude oil which Horwitz might produce from a certain well being sunk in the Alamitos Heights district. Deliveries were to be made from the tanks of the owner located on the property to which the oil company was permitted to connect its pipe-lines. A maximum daily and monthly delivery was fixed by the contract and the price agreed to be paid for the oil was the market price as determined by “the prices per barrel publicly offered by the Standard Oil Company of California at dates of delivery . . . for oil of like gravity and quality”. A special price of ten cents a barrel below market was fixed for the first fifty thousand barrels delivered.

Horwitz deeded the property in fee simple to the defendant Clark after he had failed to develop oil and had abandoned work on the well. Clark…