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January 8, 2009

Oil co. sues law firm for contract breach

By The Mainebiz News Staff

A Lisbon Falls oil company is suing an Auburn law office, charging the firm with breach of contract for refusing to honor a contract that locked oil prices in at more than $4 per gallon.

Downeast Energy Corp. filed a complaint in Androscoggin County Superior Court saying it had a contract signed in June with Linnell, Choate and Webber promising delivery of 4,000 gallons of heating oil at about $4.36 per gallon, according to the Sun Journal. Oil prices now are averaging $2.28 per gallon.

The law firm took delivery of about 1,100 gallons of oil in November. But lawyers at the firm said there was never a final agreement between the two companies and that they would pay for the one delivery and cancel the rest.

Downeast is suing for breach of contract and is seeking compensation equal to the difference in sale price of the remaining 2,936 gallons set aside for the firm and the higher contracted price, as well as other damages and costs, reported the paper.

 

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