Hershell Don Simmons Nancy Louise Simmons, His Wife v. Mobil Oil Corporation

In 1976, the appellant Hershell Don Simmons (“Simmons”) entered into a franchise agreement with Mobil Oil Corporation (“Mobil”) to lease a gasoline service station in Peoria, Arizona, and to buy Mobil petroleum products to be retailed under the Mobil trademark. Simmons operated the station under three-year franchises with Mobil that were renewed in 1979, 1982, and 1985.

On January 4, 1988, Mobil gave Simmons notice that his existing lease and retail dealer contract would expire on August 1, 1988. Mobil stated that they would not be renewed because it desired to make changes or additions to the relationship with Simmons. Mobil included in its notice an expression of hope that a new agreement could be reached and thereby renew the franchise relationship.

On February 2, 1988, Mobil presented Simmons with a new Retail Dealer Contract and a new service station lease which contained an increase in rent. The effective date for the contract and lease was August 2, 1988. On March 30,1988, Simmons executed both the dealer contract and the lease. At the same time, Simmons wrote to Mobil: “Although I am agreeing to accept the new lease and contract, I do it with reluctancy and under…