MILLER v. MCKINNON ET AL

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District Court of Appeal, First District, Division 1, California.

MILLER v. MCKINNON ET AL.

Civ. 11696.

Decided: August 05, 1941

George F. Sharp, of Oakland, for appellant. Louis Oneal, Maurice J. Rankin, and Duncan Oneal, all of San Jose, for respondents Lyle R. Nash and Thomas J. Gavin. Bohnett, Hill, Cottrell & Boccardo, of San Jose, for respondent J. M. McKinnon. Peckham & Peckham, of San Jose, for respondent E. P. Flood. C. C. Coolidge, of San Jose, for respondent Emma Allegrini.

The plaintiff, J. Lester Miller, as a citizen and taxpayer of Santa Clara county, brought this action in his name to recover on behalf of the county approximately $60,000, which he alleged had been illegally expended by the board of supervisors in connection with the repair, alteration and enlargement of certain structures and equipment at a quarry owned and operated by the county; and he has appealed from the judgment in favor of the defendants entered pursuant to an order sustaining without leave to amend the demurrers interposed to the fourth amended complaint.

The parties defendant named in the fourth amended complaint were four members of the board of supervisors, the county purchasing agent, the superintendent of the quarry, Lyle R. Nash and Thomas J. Gavin, copartners doing business under the firm name of Nash Englehardt Silva Mfg. Co., and the County of Santa Clara. It appears from the allegations of the complaint that the construction work was done by the Nash firm and included the repair of bunkers, moving and repairing hoists, extending the power line, repairing a motor, building a tunnel and foundation, construction of a conveyor, and erecting a new steel tower; that the board of supervisors did not call for competitive bids to do the work, or to furnish the materials therefor, but merely ordered the Nash firm to proceed with the work as directed. It further appears that it took approximately a year to complete the improvements; that several times each month during the progress of the work the firm submitted bills for labor performed and materials furnished; and that thereupon warrants were drawn on the county treasury in favor of the firm in payment of said bills.

The fourth amended complaint set forth two causes of action. The first was directed against the Nash firm for the recovery of the sum of $42,151.90, which represented the total amount it received from the county, and is based upon the theory that the law required competitive bidding. Pol. Code, § 4041.18. The second cause of action was directed against all other defendants except the county and the Nash firm for the recovery of the sum of $17,847.68, and was based upon allegations to the effect that one of the defendant supervisors, J. M. McKinnon, the purchasing agent, the superintendent of the quarry, and the Nash firm, conspired to allow said firm to do the work and furnish the labor and materials without competitive bidding and at a grossly exorbitant price; that in furtherance of said conspiracy bills and invoices were accepted and paid which were “padded” and not itemized as required by law; and upon information and belief it was alleged that the other members of the board of supervisors voted for the issuance of the warrants in payment of said bills without knowledge that they were illegal and improper; and that said bills included the sum of $17,847.68 for labor never performed and materials never delivered on the job.

In each count it was alleged also that the district attorney of the county after full knowledge of the facts and although required so to do, had refused for more than seven months to file an action in behalf of the county for the recovery of said moneys alleged to have been so illegally paid. The prayer of the complaint was that judgment be had against the defendants Nash and Gavin individually and as copartners for the sum of $42,151.90, plus 20 per cent thereof for the use of the money; and that judgment be had against the other defendants except the county for the sum of $17,847.68 and costs, and that all of said sums of money be paid to the county treasurer of Santa Clara county for the benefit of the county.

The demurrers were based on many grounds, both general and special, which were separately stated, and it appears from the judgment that the order sustaining the demurrers was in general terms. Therefore, if the demurrers were well taken as to any grounds stated therein the judgment must be affirmed. Haddad v. McDowell, 213 Cal. 690, 3 P.2d 550, and cases cited therein. Nor may the plaintiff complain that the demurrers were sustained without leave to amend, because so far as the record shows no leave to amend was ever requested. Haddad v. McDowell, supra.

Regarding the first cause of action, plaintiff's right, as a citizen taxpayer to sue in behalf of the county for the recovery of moneys paid to the Nash firm, is admittedly based on section 4005b of the Political Code. It is definitely so stated several times in plaintiff's briefs, and the allegations of the first cause of action so show; but it has been held, as defendants contend, that in conformity with the express terms of that code section such an action must be instituted “in the name of the county”. Gray v. White, 5 Cal.App.2d 463, 43 P.2d 318, 320. Here that was not done; as stated, the action was instituted and plaintiff seeks to maintain the same in his own name, the county having been joined as a party defendant. The decision in Gray v. White, supra, is therefore directly in point. It is there said: “In a proper case, when a district attorney with adequate knowledge of the illegal expenditure of county funds by supervisors or other county officers, refuses to institute an action to recover the money, such an action may be commenced, in the name of the county, by a citizen taxpayer therein, for the benefit of the county. Section 526a, Code Civ. Proc.; Hansen v. Carr, 73 Cal.App. 511, 238 P. 1048; 6 McQuillin's Mun. Corp., p. 680, § 2747; 44 C.J., p. 1375, § 4550. This suit was not brought in the name of the county. The county of Butte was improperly joined as a party defendant. For the reason that a municipality may be subject to a multiplicity of suits and unnecessary expense at the caprice of individuals, it has been held that where a statute makes it the imperative duty of a specified officer to maintain such actions in behalf of the county, a taxpayer may not do so in behalf of the county except upon specific allegations and proof that the officer, with adequate knowledge of the misappropriations, refuses or neglects to institute the action. Even under such circumstances, the action should be brought in the name of the county, which is the real party in interest. Section 367, Code Civ.Proc. Section 4005b of the Political Code vests the authority to maintain such an action with the district attorney and provides that it shall be brought in the name of the county.” Obviously, therefore, a citizen taxpayer may exercise no greater rights under the authority of said section than are conferred upon the district attorney.

Plaintiff concedes that the case of Gray v. White, supra, holds adversely to his contention, but he argues that the decision therein is contrary to decisions rendered by the Supreme Court in earlier cases, the two cited and relied upon by him being Mock v. City of Santa Rosa, 126 Cal. 330, 58 P. 826, and Osburn v. Stone, 170 Cal. 480, 150 P. 367. An examination of those cases shows, however, that neither was brought under the authority of section 4005b of the Political Code. They involved the financial affairs of cities; and section 4005b has no application to cities. It is made part of the county government act, and as will be seen from its terms it applies exclusively to counties. Plaintiff's right to institute and maintain the first cause of action in his name was challenged by the demurrers to the third as well as the fourth amended complaint. Therefore in view of the express terms of said section 4005b and the decision in Gray v. White, supra, the trial court was justified in sustaining the demurrers to the first cause of action without leave to amend.

We are of the opinion also that the demurrers to the second count were properly sustained without leave to amend, upon the ground, among others, that plaintiff refused to comply with the condition imposed by the trial court in granting leave to file the fourth amended complaint. As already pointed out, the cause of action set forth therein was of a type entirely different from the one stated in the first count. It was directed against all defendants except the construction firm and the county. The amount sought to be recovered thereunder was $17,847.68, and the cause of action was founded on the theory that as a result of the alleged conspiracy the defendants sued therein had caused the board of supervisors to pay to the construction firm illegally the amount sought to be recovered. No claim was made therein that any of the defendants against whom the second cause of action was directed ever received any part of said money. The third amended complaint named but one member of the board of supervisors as party defendant; and attached to said complaint and made part thereof was a list of all warrants drawn in favor of and paid to said construction firm. However, in said third amended complaint it was alleged in positive terms “that all members of the board of supervisors voted for the issuance of said warrants” (italics ours); and in sustaining the demurrer to said third amended complaint the court granted leave to amend on condition that in filing the fourth amended complaint plaintiff join as additional parties defendant all members of the board who voted in favor of any motion to issue any of the county warrants referred to by plaintiff. This condition was imposed under the authority of section 389 of the Code of Civil Procedure, which provides in part that “* * * when a complete determination of the controversy cannot be had without the presence of other parties, the court must then order them to be brought in, and to that end may order amended and supplemental pleadings ***.” Plaintiff did not comply with such condition. In filing his fourth amended complaint he added as parties defendant only three of the four remaining supervisors, and then alleged merely that all members of the board “named herein as defendants” voted for the issuance of said warrants. There is no allegation that the fifth member did not so vote nor is any reason alleged for refusing to name him as a codefendant. In that state of the record the trial court was warranted in sustaining the demurrer to the fourth amended complaint and denying plaintiff further leave to amend.

Plaintiff contends, however, that all supervisors voting for the issuance of said warrants were joint tort feasors; that the liability of joint tort feasors is joint and several; and that therefore he had the right to sue any one or more of them. But that rule does not apply in a case such as this where the alleged tort, if committed at all, was committed by a board. By no possibility could any of the warrants here involved have been issued by one supervisor; and since it was alleged in positive terms in the third amended complaint that “all members of the board” voted for the issuance of said warrants, the board as a whole must be treated as one tort feasor. That being so, the trial court acted entirely within the law in granting leave to amend only upon the condition that plaintiff join as parties defendant all supervisors voting for the issuance of said warrants. In other words, the cause of action here is the same as one brought by a stockholder in behalf of his corporation to recover alleged illegal expenditures authorized to be made by the board of directors, and must be governed by the same general rules. Osburn v. Stone, supra; Harvey v. Meigs, 17 Cal.App. 353, 119 P. 941; Fornaseri v. Cosmosart Realty, etc., Corp., 96 Cal.App. 549, 274 P. 597. Moreover, inasmuch as plaintiff sued in the capacity of a taxpayer in behalf of the county, that is, for the benefit of all taxpayers of the county, the law will not permit him to select and sue four of the alleged tort feasors and waive the right of the county to recover from the fifth.

In support of one of the special grounds of demurrer it is pointed out that the second cause of action is based upon general allegations that many of the payments authorized to be made were “exorbitant”, and that the claims were “padded” and included work never performed and materials never furnished on the job. Defendants contend, therefore, that it was necessary for plaintiff to specify in his complaint the items, bills, claims or warrants upon which those general allegations were based. This contention finds ample support in the decisions rendered in Gray v. White, supra, and Hansen v. Carr, 73 Cal.App. 511, 513, 238 P. 1048. Plaintiff is not in a position to say that this information was not available to him, because he has alleged to the cent the amount he claims was illegally paid, to–wit, $17,847.68.

There are other special grounds of demurrer upon which the trial court's ruling in our opinion may be properly sustained, but in view of the conclusions reached on the points already mentioned, the others do not require discussion.

The judgment is affirmed.

KNIGHT, Justice.

We concur: PETERS, P. J.; WARD, J.