Bonanza Fuel, Inc. v. Delta Western, Inc.

2013 WL 12120092 (2013)

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Nature of the Case

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Facts

From 2006-2010 Delta (D) provided fuel to Bonanza (P). In 2011 P sought bids to provide fuel during the summer barge season. P’s demand was stated at 2.850 million gallons of fuel and gasoline subject to change. D won the bid. P gets multiple deliveries during the season. D claims there is just one delivery in the summer and one delivery in the fall. P asserts that from 2006-2010 it got 4 deliveries per year. On July 1, D delivered 1.850 million gallons. P paid $6.6 million. D wanted to deliver again in September but P said if that were required it would need yet another later delivery. D emailed its delivery schedule for two deliveries one in September and the other in mid-October. P agreed. On September 6 the barge could not make a 900,000-gallon delivery from a several-day weather delay. The voyage was aborted and the fuel was never delivered. When contacted D told P it would have to consolidate the October delivery. But D was not exactly candid with P regarding its reasons for aborting the delivery. An internal email revealed it was really D’s decision to abort based on other customer demands and not based solely on the weather. D also knew that a later delivery would try their luck with the harbors being frozen over. P finalized its requirements at the end of September but D let them down as it did not have sufficient fuel on hand and it also claimed that weather once again delayed deliveries. D’s expert testified to that effect but P’s vessel captain countered that testimony. Things became desperate with D claiming on November 28 that it was not contractually obligated to make any more fuel deliveries. P wrote D for clarification about the exact nature of D’s refusal to perform being from weather or its interpretation of the contract. If the latter, P said it would take that position as an anticipatory repudiation. P give D a deadline to retract its repudiation and provide reasonable assurances of performance. D then responded by claiming force majeure and further performance was commercially impracticable and excused. It also said it was working hard to find a solution for renting an ice-classed tug and barge unit. P terminated D on December 3. P hired Vitus who hired a Russian ice-class tank vessel to deliver fuel escorted by a Coast Guard icebreaker. Vitus delivered on January 14, 2012. P sued D. P moved for partial summary judgment on D’s affirmative defenses.