Opinion
2-10-1953
HENNINGSEN v. MAYFAIR PACKING CO. et al. * Civ. 15132.
James F. Boccardo and Jean M. Blum, San Jose (Edward J. Niland, Santa Clara, of counsel), for appellant. O. Vincent Bruno and Frank S. Barrett, San Jose, for respondent.
HENNINGSEN
v.
MAYFAIR PACKING CO. et al.
Feb. 10, 1953.
Rehearing Denied March 12, 1953.
Hearing Granted April 8, 1953.
James F. Boccardo and Jean M. Blum, San Jose (Edward J. Niland, Santa Clara, of counsel), for appellant.
O. Vincent Bruno and Frank S. Barrett, San Jose, for respondent.
GOODELL, Acting Presiding Justice.
This appeal was taken from a judgment entered on findings for $7,593.11 in an action on a guaranty.
The action was brought by the assignee of J. B. Griffin, who is in the brokerage business in Norfolk, Virginia under the name J. B. Griffin Company, handling dried and canned fruits and other foodstuffs.
In September, 1946 Griffin, who had been a broker in Norfolk for about 30 years, visited San Jose with a view to making a business connection with defendant Mayfair. Defendant Battaglia represented Mayfair in the negotiations, which resulted in Griffin ordering 5 carloads of dried fruit, mostly prunes, from the 1946 crop and processed and packed by Mayfair. Af first they discussed handling the sales on a consignment basis whereby Griffin would be paid a brokerage when the goods were disposed of, but Mayfair would not accede, and it was ultimately agreed that the sales would be made outright to Griffin, to which he consented provided Mayfair agreed to give him a guaranty against a decline in the invoice prices. The 5 carloads were shipped to Norfolk; the first two were promptly sold by Griffin and are not involved herein. The last three, after being warehoused by Griffin in Norfolk, were slow in moving and by that time the market seems to have become inactive elsewhere including the Santa Clara Valley. The 3 carloads had been shipped from San Jose on November 8 and December 13 and 20, 1946, and the invoices, aggregating $36,677.29, were promptly paid by Griffin.
The promised guaranty was not forthcoming. In January, 1947 a Canner's Convention was held in Atlantic City, and Griffin, anticipating Battaglia's attendance, prepared and Battaglia there signed, the contract in suit which reads in part as follows: 'J. B. Griffin Co. Brokers and Distributing Agents 225 West Main Street Norfolk 10, Va. January 15th, 1947 'J. B. Griffin Co. 225 W. Main St. Norfolk, Va. 'Gentlemen: 'In accordance with our conversation when you visited our office in San Jose, we guarantee your floor stocks of Mayfair Dried Fruits against decline in our prices. This agreement covers the following three cars shipped you as follows: * * *.' It then described the 3 carloads of dried fruit then in Griffin's floor stock. It was signed by Battaglia for Mayfair.
On December 29, 1947 Griffin sent Mayfair an invoice showing the items making up the total decline in prices, aggregating $7,593.11. Mayfair temporized and Griffin pressed in vain for settlement. At another Convention Griffin saw Battaglia who then promised to 'take it up when he got back home' but nothing was done, and a year later at still another Convention Battaglia told Griffin that he would see that it was paid provided the claim was taken out of the lawyers' hands. That was not done, and this action was eventually filed.
The complaint is in 3 counts, the first based on the contract of guaranty, the second on an account stated, and the third on a claim for brokerage. At the end of the 3-day trial Battaglia's motion for nonsuit was granted on the ground that no personal liability on his part had been proved. Mayfair's motion for a new trial was denied.
In addition to denials and certain admissions, presently noted, the answer pleaded that the guaranty had been obtained by misrepresentation in that Griffin had led Battaglia to believe that his purpose in getting it was merely to make a showing to his banker that would satisfy him; that Griffin was financially embarrassed and that no claim would ever be made on the guaranty. At the trial Battaglia testified that such had been the case, but the court found against that position and there is substantial evidence to support the finding. See Boies v. Wylie, 113 Cal.App.2d 243, 248 P.2d 76.
It will be noted that the writing is silent with respect to the duration of the guaranty, and one of the questions at the trial was as to the period which the guaranty was supposed to cover. Griffin contended that it should continue as long as any of the fruit bought from Mayfair remained unsold on his floor. Battaglia and another defense witness testified that by custom such guaranty period never ran beyond 90 days. The court adopted this view when the findings were made, fixing the terminal date at April 14, 1947. Griffin contended that his total losses were as high as $17,000. (based on a longer guaranty period) but the court's adoption of the 90-day period settled that matter. The court found against plaintiff on the second count based on an account stated, and on the third count for brokerage.
Appellant's first contention is that plaintiff cannot maintain this action because she is not a licensed collection agency.
The action was commenced on February 7, 1950 and the answer was filed promptly. The trial opened on March 6, 1951, and at the end thereof, almost a year after issue was joined, permission to amend the answer was granted. The amendment pleaded that plaintiff 'is not entitled to maintain this action on the ground that she is not a licensed collection agency as defined by chapter 8 of the Business and Professions Code * * *.'
The court found that 'on December 23, 1949, J. B. Griffin, for a valuable consideration duly assigned his claim to the plaintiff' and that 'the plaintiff was not engaged directly or indirectly as a primary or secondary object, business or pursuit in soliciting claims for collection or in the collection of claims owed or due or asserted to be owed or due another.' This language follows that of § 6852 of the Business and Professions Code quoted in the footnote.
The burden of proving that plaintiff could not maintain the action because she was suing as a collection agency but not licensed as such, was of course upon the defense. Code Civ.Proc. § 1869; 10 Cal.Jur. pp. 786-7. It was not incumbent on plaintiff to prove negatively that she was not a collection agency since prima facie she had a right to sue on an assigned chose in action. Civil Code, §§ 953, 954.
The only showing appellant attempted to make on this phase of the case was by way of a stipulation that plaintiff was the secretary of Attorney Bruno, 'employed to do the secretarial stenographic work' in his office, also that she was not an attorney at law or within any of the classes exempted by § 6854. There was no attempt by the defense to prove affirmatively that she was a person 'engaging, directly or indirectly and as a primary or secondary object, business or pursuit, in soliciting claims for collection or in the collection of claims owed or due * * * to another.' The claim was not solicited by her; it was in the hands of her employer who had been retained as an attorney by Griffin to litigate it through to judgment. There was nothing about it which even squinted at a collection agency transaction. See discussion of collection agencies in Koepple v. Morrison, 84 Cal.App. 137, 257 P. 590, and in McCarthy v. Hughes, 1913, 36 R.I. 66, 88 A. 984, 985, Ann.Cas.1915D, 26, quoting 6 Am. & Eng.Ency. of Law, 209. See, also, 14 C.J.S. p. 1324.
Plaintiff did not select her employer, Bruno, as her attorney. He was already the attorney of the equitable owner of the chose in action and he, Bruno, selected plaintiff to act as the assignee of his client. In so acting she did not step out of her role as legal secretary; both positions were perfectly consistent.
We are satisfied that the exemption of 'Attorneys at law' carries with it the exemption of all persons who assist the attorney in doing his professional work. Qui facit per alium facit per se. Whatever the plaintiff did in connection with this litigation, whether as assignee suing on behalf of her employer's client, or in connection with the preparation of the pleadings, the preparation of the case for trial, or otherwise, she did as a part of the attorney's organization. If he was not a collection agency it is difficult to see how she could be one, in such circumstances. The argument that the legislature in drafting § 6854 could have expressly added the exemption of attorneys' secretaries and other employees, but did not do so (Inclusio unius est exclusio alterius) is in our opinion wholly without merit.
At 23 Cal.Jur. pp. 766 et seq., § 140, 'Absurdity'; § 141, 'Hardship or Injustice'; § 142, 'Inconvenience,' there are set forth certain familiar rules of statutory construction which, without stopping to quote them, cover this case.
The construction for which appellant contends would produce startling, not to say absurd, results. It would mean that where a person, in or out of the state, assigned a cause of action for suit, his assignee--even though his own brother or other highly trusted person--would have to obtain a collection agency license before maintaining his action. Such an unworkable and unreasonable burden would greatly impair the right of assignment, Civil Code, § 954, supra, which has existed in California for many years. It is inconceivable that the legislature in adopting these sections intended to impose any such burden, or to cut down any such well-settled right, in the absence of language clearly indicating such intent.
As already appears, the court found that 'the plaintiff was not engaged directly or indirectly' etc. in certain activities described in § 6852 defining 'Collection agency'. The last sentence of that section reads: 'Any person, when engaged in collecting claims for another, where the employment is for one or more persons, is engaged as a collection agency.' Appellant points to this language and says that this plaintiff comes squarely within it, and that the court failed to find thereon, citing Fairchild v. Raines, 24 Cal.2d 818, 830, 151 P.2d 260 and Andrews v. Cunningham, 105 Cal.App.2d 525, 233 P.2d 563, decided by this court. We are satisfied that the last sentence of § 6852 was not intended by the legislature for a case such as this. At 23 Cal.Jur. p. 767 it is said: 'General terms will be so limited in their application as not to lead to absurd consequences.' The findings which were made show clearly that the court was convinced that plaintiff was not a collection agency or acting as such in this one instance. The conclusion of law that plaintiff 'is legally entitled to maintain this action and recover judgment' also so indicates. Had the court found on the language of the last sentence of § 6852 it must have inevitably found in substance that although, literally, the plaintiff was engaged in collecting this one claim for another ('for one or more persons') she was not acting as a collection agency. No citation is necessary in support of the proposition that an appellant cannot complain of the absence of a finding which necessarily must have been adverse.
In granting leave to file this eleventh-hour, collection agency amendment the court said: 'the Court has no idea what the Business and Professions code provides for on this subject. I haven't read that section, but the Court can see that the defense proposed to be added to the answer would be highly technical and if sustained and if valid would have the effect of defeating the cause of action without meeting the cause of action on its merits. Ordinarily the Court would be not too inclined to entertain at this stage of the proceedings an amendment of that nature * * *.'
We quote that statement because we thoroughly agree with it. It is obvious that the judge granted permission to amend at that late date only to make sure that both sides would have every opportunity to present everything they had, regardless of its merits when viewed after a complete judicial hearing.
We find no merit whatever in appellant's first contention.
Appellant's second contention is that the finding that the prices of Griffin's floor stocks (based on the decline of Mayfair's prices) declined to and including April 14, 1947 a total of $7,593.11, is not supported by any substantial evidence.
Throughout both its briefs appellant points to the language of the writing which guaranteed against a 'decline in our prices.' Appellant says: 'It therefore follows that evidence as to the market price generally, prices of other packers and the prices at which Griffin sold the merchandise are entirely immaterial in determining this issue. Attention must be directed solely to the prices of Mayfair Packing Company for the products herein involved up to and including April 14, 1947.' (Emphasis added). This, the main theme of appellant's briefs, has been repeatedly stressed.
The evidence itself, however, does not support this argument for it shows that the prices of other packers, despite Mayfair's price lists, might have had such a controlling influence on Mayfair's prices as to make them decline to the prevailing level.
In the first place, the complaint alleged that from January 1, 1947 to and including November 11, 1948, Mayfair's prices did decline. Paragraph V of the answer reads: 'Answering paragraph IX * * * defendants deny each and every, all and singular, the allegations therein contained, except that defendants admit that during the period of the 1st day of January, 1947, and the 11th day of November, 1948, the prices of said defendant Mayfair Packing Company's dried and processed fruit did decline.' (Emphasis added.)
That admission left no issue in the case as to whether Mayfair's prices declined between January 1, 1947 and April 14, 1947; the only remaining issue was the extent or amount of the total decline. The court found 'That during said period of on or about September 1, 1946 to and including April 14, 1947, the prices of Mayfair Packing Company on said merchandise did decline. That the prices of floor stocks of J. B. Griffin Company, based on the decline of Mayfair Packing Company prices, declined, by reason thereof, a total of * * * $7,593.11.'
There is ample evidence from which the court could have found that the prices of other packers automatically influenced and changed Mayfair's own prices despite its price lists.
Defendants' witness Abinante testified on direct examination:
'Q. Mr. Abinante, where a packer in the dried fruit trade would issue a guarantee against decline in that packer's prices, according to the general and accepted usage and custom in the trade, would there be any decline in that packer's prices if, for the duration of that guarantee, that packer sold no products below the price at which the guarantee was given? A. No. * * *
'Q. Mrs. Abinante, according to the general and accepted usage and custom in the trade, under the circumstances of the last question I just gave you, would there be any decline in the prices of the packers giving the guarantee if some other packer happened to sell similar merchandise at a lower price? A. No.'
On cross-examination he testified:
'Q. How do you know that the answer to that question is 'No', Mr. Abinante? A. Because under the contract, why, if you guarantee against other packers' decline, why, then you have to meet it; but if you don't guarantee against other packers' decline you do not have to meet that decline, so long as you don't sell any merchandise below that price * * *.
'Q. Assume Mayfair's prices decline, do you know as a matter of fact, of your own knowledge, that Rosenberg's prices thereafter will not decline? * * *
'The Court: It's fair cross examination, counsel; that is the crux of the whole case. (Emphasis added) * * * A. sometimes it happens that they do not decline.
'Q. And sometimes it happens that they do? A. That is right. [Emphasis added]
'Q. There is no definite rule about that subject, is there? A. Well, it depends on the packer.'
The Court's remark that this was the crux of the whole case is significant. There is enough in this one piece of testimony to support a finding that just as a decline in Mayfair's prices would influence Rosenberg's, so also a reduction of Rosenberg's prices would automatically force a reduction in Mayfair's.
With respect to the inviolability of price lists defendant Battaglia was examined by plaintiff under § 2055, Code Civ.Proc.:
'Q. Well * * * will you state to your own knowledge that your products are all sold at the list quoted on your price list? A. No, I will not.
'Q. As a matter of fact, they're all sold for less than that price list, aren't they? A. Generally, yes. But conditions such as we had from '43 on to including '46, it was list.
'Q. And beginning in '47 it was below list all the time, wasn't it? A. Whatever--well, whatever you could make a sale for, I imagine.'
This testimony certainly did not indicate that a price list was sacrosanct. On the contrary, either taken alone or in combination with Abinante's testimony, it furnishes ample basis for concluding that if the prices of Rosenberg or Sunsweet or Del Monte (all of whom have branches and carry stocks in Norfolk) declined, Mayfair's prices would follow suit, which corroborates Griffin's testimony that 'we have to follow our competitors'. Battaglia was himself a defendant and he signed the guaranty on behalf of Mayfair, and it was he who admitted that their products generally were 'sold for less than that price list' (except list prices held up in such conditions as prevailed from '43 to '46).
The person who verified the answer expressly admitting that Mayfair's prices 'did decline' knew, of course, what their price lists showed, and at the same time knew the prices which they were actually getting. The admission was made without qualification, and in the face of its bald statement that their prices did decline appellant's repeated arguments respecting Mayfair's own prices lose all their force.
Once that admission was made, there was no issue whether or not Mayfair's prices declined and the only remaining question was, How much did they decline?
The plaintiff introduced 21 exhibits, the defendants 5. The record contains price lists, invoices, correspondence, and other documentary evidence. It was the task of the trial judge to determine from the testimony and from this mass of evidence whether Griffin's claim of $7,593.11 was proved. This was purely a question of fact on which the Court found in plaintiff's favor. Appellant has not convinced us that there is any lack of substantial evidence to sustain it.
Most of the testimony was given by Griffin. He testified respecting market conditions and prices. It was the function of the trial judge to weigh his testimony against that of the defense witnesses. The findings show that the court was satisfied with Griffin's testimony and with the fairness and accuracy of his computation of the price decline, since the judgment, to a cent, is for the amount of his claim.
The judgment is affirmed.
DOOLING, J., and JONES, J. pro tem., concur. --------------- * Subsequent opinion 261 P.2d 521. 1 Sec. 6852 provides: "Collection agency' means and includes all persons engaging, directly or indirectly and as a primary or secondary object, business or pursuit, in soliciting claims for collection or in the collection of claims owed or due or asserted to be owed or due to another, and includes the repossession-collection business as that business is defined in this article. Any person, when engaged in collecting claims for another, where the employment is for one or more persons, is engaged as a collection agency.' Section 6854 provides: "Collection agency' does not include any of the following unless they are conducting collection agencies: '(a) Attorneys at law. '(b) Persons regularly employed on a regular wage or salary, in the capacity of credit men or in similar capacity, except as an independent contractor; provided, however, no such person is excluded from 'collection agency' if he shall file or maintain suits as assignee to collect claims assigned to him without being represented in each such suit by a duly authorized and licensed attorney at law. '(c) Banks. '(d) Common carriers. '(e) Title insurers and abstract companies, while doing an escrow business. '(f) Duly licensed real estate brokers or agents doing a real estate business. '(g) Merchant-owned nonprofit credit associations. '(h) Duly licensed personal property brokers while making collections for another person of common ownership or affiliated through corporate control.' Section 6870 provides: 'No person shall conduct within this State a collection agency or engage within the State in the business of collecting claims for others, or of soliciting the right to collect or receive payment for another of any claim, or advertise, or solicit, either in print, by letter, in person or otherwise, the right to collect or receive payment for another of any claim, or seek to make collection or obtain payment of any claim on behalf of another without having first applied for and obtained a license.'