Opinion
Rehearing Denied July 5, 1933.
Appeal from Superior Court, Santa Barbara County; Pat R. Parker, Judge.
Action by Louis N. Crawford against J. E. France. Judgment for defendant, and plaintiff appeals.
Reversed.
YORK, J., dissenting.
COUNSEL
Shaeffer & Weldon, of Santa Maria, for appellant.
Preisker, Goble & Twitchell, of Santa Maria, for respondent.
OPINION
HOUSER, Justice.
Plaintiff appeals from a judgment rendered against him and in favor of defendant in an action tried before the court, sitting with a jury. The issue relates to a question of compensation claimed by plaintiff to be due to him under the terms of a written contract entered into between plaintiff as an architect, and defendant as the owner of a piece of real property upon which a hotel building was proposed to be constructed.
After having provided in detail regarding the general and the specific services which were to be rendered by plaintiff, the contract contained the following clause: "The Owner agrees that the Architect is to be paid for his services, the sum equal to six per cent of the cost of the work exclusive of the cost of the land, in installments as follows: 1/5 of the total fee based upon the estimated cost, on acceptance of preliminary drawings and estimates of cost; on completion of working drawings exclusive of details, a sum sufficient to bring the total payments to 3/5 of the total fee based on the estimated cost or upon the lowest reputable bids for construction; the balance, 2/5, to be in installments as the work progresses."
Following the preparation by plaintiff of "preliminary drawings" and their acceptance by defendant, bids for the construction of the building were procured by plaintiff, and thereupon it was discovered that, notwithstanding the subsequent elimination of certain features from the original plans, the cost of the construction of the building would be largely in excess of the amount which had been contemplated would be its cost. Thereupon defendant abandoned the project; and upon his failure and refusal to compensate plaintiff for the services rendered by him, plaintiff commenced an action against defendant for damages arising from alleged breach of the contract. Besides a general denial of the several allegations of the complaint, the answer contained specific allegations to the effect that the plaintiff agreed to prepare plans and specifications for a hotel building not to exceed in cost the sum of $45,000, which was the asserted consideration upon which defendant entered into the contract; that plaintiff failed to perform his contract, "because the building he planned could not be built for less than $62,000; that the plaintiff failed to design a hotel building ‘suitable to the needs of the owner,’ in accordance with and as required by the terms of the contract. That one of the known needs of the owner was that the hotel should cost the defendant not to exceed $45,000, whereas, the hotel building designed by plaintiff could not be constructed by defendant at a cost of less than $62,000." (Respondent’s Reply Brief, p. 6.) In addition thereto, defendant restated the said alleged facts, and thereupon predicated a defense of fraud on the part of plaintiff in inducing defendant to enter into the agreement.
On the trial of the action, evidence was admitted by the trial court not only for the purpose of establishing what was the "estimated cost" of the building and for which the contract did not specifically provide, but as well to prove that orally and outside and beyond the terms of their written agreement, the parties previously had agreed that in the event the building should cost an amount in excess of the said "estimated cost" defendant was to pay to plaintiff nothing for his services. However, after all the evidence had been introduced, "the charge of fraud was abandoned because proof constituting the elements of fraud was lacking." (Respondent’s Reply Brief, p. 7.) Notwithstanding such abandonment, at the request of defendant the trial court instructed the jury that: "If you find that the plaintiff agreed to design a building so that the cost thereof should not exceed $45,000, there is the implied agreement that the architect cannot recover unless he performs his contract in this respect, and it is not necessary in order to produce this result that the parties should expressly agree that the architect should receive no pay in the event that he failed to perform this part of the agreement." Pursuant to the request of defendant, other instructions, to similar effect, were also given to the jury by the trial court.
Conceding that evidence offered for the purpose of explaining the ambiguity in the contract relating to the item of "estimated cost" was admissible, it is apparent that the addition to the written contract of a provision which, on the happening of a specified contingency, would excuse defendant from making compensation to plaintiff for services performed or to be performed by him, would be a most material alteration of the agreement which was executed by the parties, and as to which, because of the absolute silence of the agreement with reference thereto, no ambiguity existed. As far as the written agreement was concerned, the questioned evidence introduced, or proposed to introduce, into it an entirely new element which, as hereinbefore has been stated, rested wholly in parol, or was evidenced solely by the precedent oral stipulations of the parties to the agreement.
Notwithstanding what may be the effect of the decision in the case of Hudson v. Barneson, 41 Cal.App. 633, 183 P. 274, by a host of authorities in this state, as well as by others throughout the several jurisdictions of the United States, the principle of law is well established that in circumstances such as were present in the instant case, the written contract of the parties could not be varied or modified by evidence which related to oral stipulations or understandings of the parties which preceded the execution of the contract. Indeed, by the terms of section 1625 of the Civil Code it is provided that: "The execution of a contract in writing, whether the law requires it to be written or not, supersedes all the negotiations or stipulations concerning its matter which preceded or accompanied the execution of the instrument." And as far as affects the instant situation, section 1856 of the Code of Civil Procedure provides as follows: "When the terms of an agreement have been reduced to writing by the parties, it is to be considered as containing all those terms, and therefore there can be between the parties and their representatives, or successors in interest, no evidence of the terms of the agreement other than the contents of the writing. * * *"
Although on the trial of the action the evidence to which appellant now objects may have been admissible under the allegations of the answer with respect to the defense of fraud, on the abandonment of that defense, evidence with reference to the precedent oral negotiations or stipulations of the parties which was not explanatory of some ambiguity in the provisions of the agreement should not have been permitted to remain in the case for the consideration of the jury. In other words, the evidence in question related to facts which could not constitute a defense to the action. It follows that by reason of the action of the trial court in the premises, of which appellant complains, plaintiff was substantially prejudiced.
The judgment is reversed.
I concur: CONREY, P. J.
YORK, Justice.
I dissent. I can see no difference in the question of law involved here from that decided in the case of Hudson v. Barneson, 41 Cal.App. 633, 183 P. 274. In that case a rehearing was denied by the Supreme Court without a dissenting vote. Until that case is specifically overruled by the Supreme Court, I believe that we should follow that decision.