The Miami Pipe Line Company, Inc., a Corporation v. The Panhandle Eastern Pipe Line Company, a Corporation

384 F.2d 21, 1967 U.S. App. LEXIS 4946
CourtCourt of Appeals for the Tenth Circuit
DecidedOctober 6, 1967
Docket9018_1
StatusPublished
Cited by7 cases

This text of 384 F.2d 21 (The Miami Pipe Line Company, Inc., a Corporation v. The Panhandle Eastern Pipe Line Company, a Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
The Miami Pipe Line Company, Inc., a Corporation v. The Panhandle Eastern Pipe Line Company, a Corporation, 384 F.2d 21, 1967 U.S. App. LEXIS 4946 (10th Cir. 1967).

Opinion

ORIE L. PHILLIPS, Circuit Judge.

On October 16, 1961, the Miami Pipe Line Company 1 commenced this action against the State Board of Social Welfare of Kansas 2 and Panhandle Eastern Pipe Line Company 3 in the District Court of Shawnee .County, Kansas.

Miami is a Kansas corporation, with its principal office in Osawatomie County, Kansas. Panhandle is a Delaware corporation, with its principal office in Kansas City, Missouri. The Welfare Board is an official board of the State of Kansas.

Panhandle removed the action to the United States District Court for the District of Kansas. A motion of Miami to remand the case was denied.

The trial court dismissed the action against the Welfare Board without prejudice, on the ground that as to it the action was a suit against the State and the State had not consented to be sued.

The action then proceeded to trial against Panhandle before the court, without a jury, and resulted in a judgment in favor of Panhandle. Miami has appealed.

In its petition for removal, Panhandle averred that Miami’s petition set up a separate and independent claim against it, which would be removable if sued upon alone, and joined it with one or more otherwise nonremovable claims or .causes of action within the meaning of 28 U.S. C.A. § 1441(c); and that the Welfare Board was fraudulently joined as a party defendant for the sole purpose of preventing Panhandle from removing the case from the State court to the Federal court.

Part I

Miami contends that the trial court erred in not remanding the action'to the State court. Hence, we must consider the pertinent allegations- of Miami’s petition in the State court.

In the first cause of action of its pe-' tition, Miami alleged:

That Panhandle owns and operates under certificates of public convenience and necessity issued by the Federal Power Commission an integrated gas pipeline system in the States of Texas, Oklahoma, Kansas, Missouri, Illinois, Indiana, Ohio and Michigan; that it produces natural gas' from its leases located in Texas and Kansas, and purchases natural gas produced in Texas, Oklahoma and Kansas; that it transports and sells-such gas in interstate commerce for resale for domestic, commercial and other uses and also directly to industries and others for their own use;

That “on or about January 6, 1953, the plaintiff (Miami) had a contract *23 with the defendant Panhandle for the purchase of natural gas to he transported through plaintiff’s (Miami’s) pipeline for resale to the defendant Board (the Welfare Board) for use at the Osawatomie State Hospital”;

That “at the same time the plaintiff (Miami) had a contract with the defendant Board (Welfare Board) for the purchase of such gas”;

That on or about such date “the defendants (Panhandle and the Welfare Board) entered into a plan or devise for the purpose of breaching their contracts with plaintiff (Miami)” and obtaining for Panhandle “the per M.C.F. rightfully due plaintiff (Miami).”

Miami undertook to set out the particulars of the plan or devise by the allegations in its petition hereinafter set out.

Miami alleged that for many years prior to October 1, 1943, it “had been supplying natural gas to the Osawatomie State Hospital from shallow gas wells in and about the * * * hospital grounds” and that “the last written contract was entered into on October 1, 1943.” Miami attached to its petition as Exhibit A a copy of such contract.

The first paragraph of such contract read:

“This Contract made and entered into this 1st day of October, 1943 by and between the Miami Pipe Line Company, a Kansas Corporation, hereinafter called the vendor, and The State of Kansas, hereinafter called the vendee.”

It recited that “The vendor * * * for the past several years” had been “furnishing to the vendee the greater part of its fuel requirements at the Osawatomie State Hospital” and that it was “the mutual desire of the parties” to the contract “that the facilities of the vendor * * * be enlarged and increased to meet the entire fuel requirements of” the State Hospital.

By its terms “the vendee” agreed “to purchase and accept delivery from the vendor the merchantable natural gas that said vendor” could “deliver toward the fuel demand of” the State Hospital; and “the vendor” agreed it would “use its best endeavors and abilities to supply enough of such natural gas to meet the entire fuel requirements of the” State Hospital; and “the parties * * * mutually” agreed “that the price of said gas” should be “twenty-one (210) cents per 1000 cubic feet” and that the contract should remain in force and effect for a period of one year from its date.

The closing paragraph of the contract read:

“In Witness Whereof, The parties hereto have set their hands and seals this date above first mentioned.”
The contract was signed as follows:
“Attest:
Kenneth R. Johnson,
Secretary
Approved
David L. MacFarlan, Chairman
State Board of Social Welfare
The Miami Pipe Line Company By Emil J. Miller, President Vendor
The State of Kansas By (illegible)
Its Business Manager, Vendee”

It is important to keep in mind that the parties to the contract of October 1, 1943, were Miami and the State of Kansas ; that the recitals therein referred to Miami and the State and to no other parties; that the agreements and covenants in the contract were those of the State and Miami and no other persons, and that only Miami and the State by its Business Manager executed the contract; *24 that Miami asserted no claim of a breach of any contract by the Welfare Board other than the contract of October 1, 1943; that Miami’s allegations referred to above that the gas to be purchased from Panhandle by Miami was for resale to the Welfare Board, and that the Welfare Board entered into a plan or devise with Panhandle for the purpose of breaching a contract of Miami’s with the Welfare Board are clearly refuted by the contract of October 1, 1943, the contract to which the allegations referred, which shows that the Welfare Board was not a party to such contract, and that the gas purchased from Panhandle by Miami was not for resale to the Welfare Board,-but to the State. 4

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Cite This Page — Counsel Stack

Bluebook (online)
384 F.2d 21, 1967 U.S. App. LEXIS 4946, Counsel Stack Legal Research, https://law.counselstack.com/opinion/the-miami-pipe-line-company-inc-a-corporation-v-the-panhandle-eastern-ca10-1967.