Opinion
Rehearing Denied Dec. 8, 1930
Hearing Granted by Supreme Court Jan. 5, 1931.
Appeal from Superior Court, Placer County; J.B. Landis, Judge.
Action by the Pacific Fruit Exchange, a corporation, against F.W. Barkhaus and wife. From an adverse judgment, plaintiff appeals.
Reversed with directions.
COUNSEL
Athearn, Chandler & Farmer, Frank R. Devlin, and Walter Hoffman, all of San Francisco, and T.L. Chamberlain, of Auburn, for appellant.
H.W. Zagoren, of Sacramento, and K.D. Robinson, of Auburn, for respondents.
OPINION
SHIELDS, Justice pro tem.
On and before the 8th day of February, 1927, F.W. Barkhaus and his wife, Amanda, were farmers in Placer county, owning a large orchard and holding under lease from three different parties additional orchard tracts. They were engaged in the business of growing and selling fruits of various kinds on and from these orchards. The Pacific Fruit Exchange was a corporation engaged, among other things, in loaning money to fruit growers, and in the sale of fruits upon commission. On this date the above parties entered into an agreement by which the Pacific Fruit Exchange was to advance large sums of money to F.W. Barkhaus and his wife, Amanda A. Barkhaus, hereafter referred to as the defendants, to enable them to care for and cultivate their orchards and to prepare the crops of fruit grown thereon for market. These advances were to apply to the crops of 1927, 1928, and 1929, for each of which years certain sums of money were to be advanced. In consideration of these advances, defendants, among other things, agreed to market all of their fruit to be grown upon all of the land owned by them and upon the three pieces of land held by them under lease, through the Pacific Fruit Exchange, and to pay them for making such sales certain commissions provided for in the agreement. To secure the repayment of the sums advanced and to further set out the agreement between the parties, they at that time and as part of the first agreement entered into a "mortgage marketing contract" to which further reference seems to be unnecessary.
The agreement first mentioned provided "that should the first parties (defendants) sell all or any portion of the orchards owned by them, hereinbefore mentioned, or cancel any of the leases on the orchards now farmed by the first parties, then and in that event, upon payment by first parties (defendants) to second parties of a proportionate amount of the indebtedness then owing from first parties to second party, second party agrees to release its mortgage lien on any of said acreage sold or lease cancelled." The parties proceeded under these agreements during the season of 1927 and for a portion of 1928, when on March 20, 1928, defendants notified plaintiff that they had sold their property and desired to pay their indebtedness and be released from their mortgage and marketing contract. It developed as a fact that the defendants had sold all of the land owned by them, and that they had assigned the leases covering the acreage mentioned in the marketing contract to the same purchaser. Plaintiff contended that while defendants were entitled to a release as to all lands owned by them, because such lands had been "sold" as provided in the contract, that they were not entitled to such discharge as to the lands held by them under lease, because none of such leases had been "cancelled," as was required by the contract. This is the only question in the case. Defendants paid the full amount of their indebtedness to the plaintiff, and plaintiff released them from their mortgage, reserving, however, their right to enforce the contracts in so far as they gave plaintiff the right to market the fruits grown on the leased property and obligated the defendants to purchase certain supplies from them. Defendants refused to recognize the further existence of the contracts, and upon their failure to permit the plaintiff to sell their fruit for the year 1928, and thus to earn a commission, or to purchase materials from plaintiff, or to engage plaintiff to load the fruit for transportation, all as provided in the contract, this action was begun.
It was stipulated that should the contract be held to be in effect, that the plaintiff would be entitled to recover $986.49 as damages for defendants’ breach. At the trial the court held that the sale of the leases, and their assignment to the purchasers, constituted a "cancellation" of the leases as provided for in the contract and as is expressed in the portion of the contract above quoted. Judgment accordingly went for the defendants. This conclusion of the court we deem to have been erroneous.
It will be noted that the contract provided that upon the sale of the property owned by the defendants, or the cancellation of the leases held by them, and upon the payment of a proportionate amount of the indebtedness then owed by the defendants, the plaintiff was to "release its mortgage lien upon any of said acreage sold or lease cancelled."
It does not say that such sale, or cancellation and payment, should have any other effect. Specifically it does not provide that other portions of the marketing agreement should terminate, or that plaintiff’s right to market the fruit, to load it, or to sell to the defendants necessary shipping materials should cease or end.
But the case was tried on the theory that the whole claim of the plaintiffs depended upon whether or not the leases held by defendants had been cancelled. We will so consider it. We do not think that they were canceled; canceled in fact, or as that term is used in the contract. Plausible theories may be advanced as to why the parties might have used the word "cancel" in some special or different sense. But such theories are merely speculative. The word is a common and ordinary one, having a plain and well-defined meaning. There was no evidence before the court to show that it was used in any other than its usual sense. None would have been permissible. There was nothing in the context which suggests an unusual meaning.
To "cancel" a contract means "doing away with" it. Winton v. Spring, 18 Cal. 451. "To ‘cancel’ a contract means to abrogate so much of it as remains unperformed." Young v. Flickinger, 75 Cal.App. 171, 242 P. 516, 517. To cancel is defined "to blot out or obliterate *** to annul, *** to revoke, to do away with." 9 Corpus Juris. 1153. "The words used by the parties ‘canceled as of June 28, 1923,’ are not ambiguous, and should be given their ordinary and common meaning. ‘Cancel’ means to annul or destroy; to make void; to set aside; as to cancel a debt or engagement." Irwin v. State Brokerage Co., 82 Ind.App. 687, 147 N.E. 531, 532; Toland v. Toland, 123 Cal. 140, 55 P. 681. In this case the leases were not terminated, set aside, made void, or annulled. They were in full force and effect. They were sold as living things, rather than blotted out and ended. Their sale and assignment by the defendants who still remained parties to them, with a subsisting contingent liability under them, did not amount to their cancellation, as provided for in the agreement. As a consequence the agreement in the particulars sued upon remained in force, and the plaintiff was entitled to recover.
The judgment is reversed, and the trial court directed to enter judgment in favor of the plaintiff for the amount of the stipulated damages.
All concur.