Question 3

Shaw leased a service station from Mobil Oil.Shaw's monthly rent was based on his purchase of gasoline from Mobil.He was to pay 1.4 cents per gallon, or a $470 minimum monthly rent.Each month, Shaw would have to purchase 33,572 gallons to reach this minimum.In July, Shaw ordered 34,000 gallons, which would have allowed him to more than meet the monthly rent.Mobil, however, could deliver only 25,678 gallons in July.Nevertheless, Mobil attempted to collect the $470 minimum monthly rent.In a resulting lawsuit, Shaw claimed that his payment of the $470 minimum and Mobil's readiness to deliver at least 33,572 gallons were concurrent conditions and therefore, as a result of Mobil's inability to deliver, he was not obligated to pay the minimum rent for that month.Discuss.