Phillips Petroleum Co. v. Shell Development Co.

LEAHY, District Judge.

The acceptance by the parties of Recommendation No. 48 was, in substance, a covenant not to sue. Since this is properly a matter of defense, the present motion of defendant is procedurally unsound. Nevertheless, I conceive the purpose of the new Rules to be the quick and inexpensive settlement of disputes and, since the question raised by defendant’s motion must ultimately be determined, I accordingly shall consider and dispose of the motion, without the aid of any other facts.

I think the motion to stay should be denied. The covenant not to sue was clearly made in specific reference to Recommendation No. 48. It was an implied in fact condition in the agreement that, with the revocation of the order, the prohibition not to sue was at an end. Cf. Canister Co. v. National Can Corp., D.C.Del., 63 F.Supp. 361. Moreover, I cannot believe the parties intended the prohibition to apply until the fortuitous circumstance of the declaration of the end of the national emergency by the President or Congress, when the specific “emergency” which gave rise to the recommendation ceased.

The motion to stay is accordingly denied.