REGULATION OF BUSINESS-TRADE RESTRAINTS-BUSINESS PRICE AND USE RESTRICTIONS ACCOMPANYING SALE OF LAND

Plaintiff, a wholesale and retail dealer in "Marathon" products, and the smallest wholesale distributor of gasoline in Ann Arbor, sought to enjoin defendant from selling Marathon gasoline at less than the price set under the provisions of the standard dealer's contract. Defendant bad acquired his station by a deed containing a covenant expressly intended to run with the land, providing for the operation of a filling station on the land, and a ten-year agreement that aII petroleum products sold on the premises were to be supplied by plaintiff "at such prices and on such terms as are customarily furnished to other dealers in like products in the Ann Arbor, Michigan, area.'' The customary dealer's contract contained a provision for setting resale prices, the dealer to follow the price set at plaintiff's retail station, which in turn was set to meet competitors' lowest price. Relying on defendant's promise to sign such a contract, plaintiff installed equipment to be loaned under its terms and delivered an initial order of gasoline. Defendant refused to sign the contract, objecting to the uniform price clause, and started to sell gasoline at less than the going price.

Held, decree for injunction affirmed. The price-fixing clause was a part of a covenant running with the land and was not a violation of the Michigan antitrust act of 1899 since it constituted a reasonable restraint of trade. Staebler Kempf Oil Co. v. Mac's Auto Mart, Inc., (Mich. 1951) 45 N.W. (2d) 316.