March 16, 1977 KEY WORDS: 4 4
MEMO TO: MGG
FROM: KMG /' ~
RE: Termination Provision in SWFWMD Contract
As is generallytthe case with the assignments that you
give me, there is very little Florida Law on this subject;
however, I did find a case which is very similar on the facts
and is still good law. The only drawback is that it is a 1938
Supreme Court decision.
Thompson v. Shell Petroleum Corp., involves the sublease
of a filling station which gave the sublessee right to cancel
it on 15 days notice and payment of $100. The Court noted
that there is a split of authority as to the effect of such a
provision. Some jurisdictions hold that contracts containing
such provisions are unenforceable due to lack of mutuality;
however, Florida, under the Thompson case, seems to have adopted
the opposite position. The Supreme Court in Thompson held that
the fatt that a contract is terminable at the option of only one
of the parties thereto, does not render it objectionable for lack
of mutualitfywfremedy, nor prevent the party having the option
from enjoining a breacho6f contract. The Court recognizes the
doctrine mutuality remedy is an artificial rule of reciprocity.
and its fundamental purpose is simply to secure performance on
the Plaintiff's part of his excutory promise; therefore, the
objection of lack of mutuality would not prevent the enforcement
of a contract as long as it is actually kept alive by the Plain-
f tiff's continued performance.
Under the authority of the Thompson case, the district may
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un 3 ` 77-75
leave the termination clause in its contract and still be
able to enforce them in the Courts.