CHASTAIN v. BELMONT

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District Court of Appeal, Fourth District, California.

CHASTAIN v. BELMONT.*

Civ. 4726.

Decided: December 14, 1953

G. V. Weikert, Los Angeles, and S. B. Kaufman, Anaheim, for appellant. Rimel & Johnston, Santa Ana, for respondent.

This appeal involves an agreement between an orange grower and fruit shipper. Plaintiff alleges in his complaint that on June 25, 1950, he was the owner and in possession of a crop of oranges growing upon his 15 acre tract of land near the city of Anaheim; that on said day the defendant wrongfully, maliciously and fraudulently entered upon said real property and unlawfully picked and carried away 1,226 boxes of oranges and converted them to his own use to plaintiff's damage in the sum of $2,450; that the defendant also injured plaintiff's citrus trees to his further damage in the sum of $300.

Defendant answered, alleging, among other things, that on or about August 4, 1949, plaintiff and defendant entered into a contract in writing (a copy of which is attached to the pleadings and is the contract here involved); that concurrently with the execution of the contract defendant loaned to plaintiff the sum of $6,000; that on or about June 25, 1950, defendant entered upon plaintiff's land and picked 1,226 boxes of oranges in accordance with the provisions of the contract; that plaintiff prevented defendant from picking and harvesting the remainder of the crop and that plaintiff is indebted to defendant on a book account for money loaned in the sum of $5,297.26. Defendant also filed a cross-complaint in which he sought recovery of said sum and further alleged that plaintiff had violated the contract and had refused to deliver the 1950 orange crop in accordance therewith. He also sought liquidated damages at the rate of 35¢ per box for fruit marketed elsewhere by plaintiff.

In plaintiff's answer to the cross-complaint he alleged that the said $6,000 received by him from defendant was not a loan but was in payment for a matured crop of oranges, paid on the basis of $1 per box for the estimated crop with an agreement for adjustment depending upon the number of boxes in the crop; that the contract was for the year 1949 only; that defendant Belmont, through his agent, represented to plaintiff that if he would execute a consignment contract, defendant would guarantee plaintiff a minimum of $1 per field box for a 3,519 cubic inch box; that under such agreement there would be deducted from any possible additional sums to be paid by plaintiff certain costs and expenses and if plaintiff's fruit, when sold, brought sufficient money not only to meet the guarantee of $1 per box but to pay said costs and expenses, that the additional returns would then be paid to plaintiff. It was further alleged therein that the written contract was not in accordance with the oral agreement and that defendant's agent made false representations as to the contents and meaning of the written contract, thereby inducing plaintiff to execute it.

The trial court found that on June 25, 1950, defendant Belmont entered upon plaintiff's property and picked 1,226 field boxes of oranges at the guaranteed price of $1 per field box; that the said $6,000 paid to plaintiff was an advance on the purchase price of plaintiff's crop and was not a loan; that the contract between the parties was in force and effect during 1949 and 1950; that plaintiff Chastain did not during the last ten days of November, 1949, notify defendant Belmont that the contract was terminated; that during the year 1950 plaintiff Chastain picked 2,049 boxes from his citrus grove; that plaintiff agreed to pay defendant as liquidated damages the sum of 35¢ per box for the 1950 fruit picked by plaintiff; that Chastain is entitled to credit for 4,966 field boxes of oranges picked in 1949 at $1 per field box under the guaranteed provisions of the contract, leaving a balance of $1,034 owing at the end of the 1949 picking season; that Belmont is entitled to interest on this sum amounting to $47.65 and is entitled to a credit of 35¢ per field box on the 2,049 field boxes picked by plaintiff and withheld from Belmont as liquidated damages in the sum of $717.15; that Chastain is entitled to a credit of $1 per box for the 1,226 boxes picked by Belmont and the total due Belmont was and is the sum of $626.70, plus costs. The trial court further found in accordance with the allegations in Chastain's affirmative defenses that the parties entered into an oral agreement whereby Belmont guaranteed to Chastain $1 per field box for a 3,519 cubic inch box for all citrus fruit received and accepted as per contract during the 1949 season only; that Belmont's agent represented that the written contract provided as the parties had agreed orally and that Belmont and his agent knew that the written instrument did not express the intention of the parties.

Belmont appeals from the judgment only insofar as it awarded him on his cross-complaint the sum of $620.79 instead of $5,085.14, plus interest, and Chastain appeals from that part of the judgment awarding Belmont liquidated damages on his cross-complaint and costs.

The instrument signed by the parties hereto was partly printed and partly in handwriting. The printed matter provides, in part, that the grower agrees to consign to Belmont all oranges growing or to be grown on plaintiff's premises during the term of the contract * * *; ‘that this contract covers merchantable fruit only and the shipper or his agent shall be the sole judge as to the merchantability of said fruit’. * * * Shipper agrees to pay to the grower the total amount received from the sale of said fruit, after deducting therefrom all sums of money (1) paid out in advance hereunder; or (2) loaned or advanced to or for the use and benefit of the grower; or (3) paid out for picking and processing said fruit, also deducting (4) hauling charges at prevailing rates; and (5) shipper's charges for packing and selling said fruit, as follows: 125¢ per packed box for picking oranges or grapefruit and 15¢ per packed box for selling * * * etc. (The figures 125 and 15 were written in pencil in the blank spaces provided.) * * * Grower agrees to pay shipper as liquidated damages 35¢ for each box disposed of by grower to any person other than the shipper. The contract also provides as follows: ‘Shipper guarantees to grower 1.00 per field box for 3519 cu. inch box for all citrus fruit received and accepted as per contract for and during current season only’. The underlined portion of said provision was written in pencil and is the basis for the trial court's admission in evidence of the statements of the parties as to what was said at the time and prior thereto as to what was intended by them and to explain the ambiguities in the agreement.

Appellant Belmont contends that under the consignment contract, the guarantee was limited to that portion of the 1949 crop of fruit classified as merchantable. However, he made the same contention in Jackson v. Belmont, 108 Cal.App.2d 288, 238 P.2d 1084, and we there held contrary to his contention and that the trial court properly received in evidence the statements of the parties as to what was said at the time as indicating the real purpose of additions and modifications of the same printed form contract. Again in Groover v. Belmont, 114 Cal.App.2d 623, 250 P.2d 686, this court held that parol evidence was admissible where, as here, the written contract was ambiguous in many respects and there was an obvious inconsistency between the provisions contained in the fine print and the provisions written in longhand. In that case a provision written in longhand in the same form contract guaranteed 35¢ per field box to the grower for fruit taken, while the printed provision was that the packer should pay the grower only what was left after deducting numerous charges, and after eliminating any fruit which the packer might prefer to consider as unmerchantable. In that case, as here, mistake, misrepresentation and fraud were alleged and the validity of the agreement was the fact in dispute. Under the pleadings and proof in the instant case the trial court was entitled to find both fraud and mistake as well as ambiguity in the contract.

Plaintiff Chastain testified that on or about August 4, 1949, he had a conversation with Mr. Herb Miller (Belmont's agent) in which Miller stated that they would give him 90¢ a box for his fruit and that plaintiff refused this offer; that he later talked to Miller and the substance of that conversation was ‘that they would give me $1.00 a box guarantee on my fruit with the provision that if it brought more, I would get it, but I was guaranteed that $1.00 a box net to me. There would be no recourse on the $1.00 a box’; that the substance of another conversation with Miller was ‘Well, the first thing I asked Miller is if this dollar a box guarantee meant that a dollar was mine without recourse from Belmont; that I got that dollar net and if there was anything above the cost of packing and all of that my dollar I was to get that. I was to get the dollar a box net to me. We estimated the crop at 7,000 boxes, which it didn't pick, but in view of the fact that there was 7,000 boxes I asked for a $6,000 advance on the pick before they started picking and which he agreed to. I also asked, before we made the contract, that he put a provision in there that the contract covered 1949 crop only. He made the contract and I disagreed to some of the other. * * * He wrote the contract and I signed it and I called his attention to the fact that he handn't put on the contract ‘to cover 1949 crop only,’ and he said, ‘Okay, I'll put in on’, and took my copy and put it on.' Chastain further testified that he would not have executed any instrument or agreed to sell any of his fruit to Belmont if he had known that the meaning of the written contract was in any respect different from the oral understanding reached with Miller. This testimony, together with the apparent ambiguities and inconsistencies in the written agreement, furnish substantial support for the findings and the conclusion of the trial court that Belmont was obligated under his contract to pay to Chastain the net sum of $1 per field box for all of Chastain's oranges picked by Belmont in 1949.

Plaintiff Chastain failed to give Belmont written notice of the termination of the contract as therein provided and the trial court's finding that the contract was in full force and effect during 1950 is supported by the record. The endorsement on the back of the contract that ‘this contract covers 1949 crop only’, signed by Herb Miller, adds nothing to the written agreement since the guarantee of $1 per field box was expressly ‘for and during current season only’.

Appellant Chastain contends that the trial court erred in awarding Belmont 35¢ per box for fruit picked by Chastain and not delivered to Belmont. This award was based upon the provision in the contract that ‘Grower agrees to pay the shipper as liquidated damages the sum of thirty-five cents ($.35) for each and every commercial package box known to the trade as ‘standard field box’ or the equivalent thereof of citrus fruit, which the grower may dispose of, sell, market, or consign to any person other than the shipper named herein or that grower may remove or permit to be removed from said citrus orchard or fail to deliver to said shipper, it being specifically agreed that it is impractical and extremely difficult to fix the actual damage which would thereby be suffered by the shipper.'

Section 1671 of the Civil Code provides that the parties to a contract may agree therein upon an amount which shall be presumed to be the amount of damage sustained by a breach thereof, when, from the nature of the case, it would be impracticable or extremely difficult to fix the actual damage.

In Better Food Markets v. American Dist. Teleg. Co., 40 Cal.2d 179, 184, 253 P.2d 10, the general rules relating to agreements providing for liquidated damages are discussed, and it is there held that, under the law generally, the parties are allowed to contract for liquidated damages if it is necessary to do so in order that they may know with reasonable certainty the extent of liability for a breach of the agreement; that unless a clause providing for liquidated damages falls within the provisions of section 1671 of the Civil Code, it is invalid; and except on admitted facts this is generally a question to be resolved by the trier of facts; that the burden is on the party seeking to rely upon a liquidated damage provision in the contract to plead and prove facts showing impracticability.

The trial court found that it was and is impracticable and extremely difficult to fix the damage or loss to Belmont resulting from the refusal of Chastain to permit Belmont to market the 1950 crop of oranges. The impracticability of fixing such damages and the resulting damage to Belmont from Chastain's failure to deliver the 1950 crop was adequately pleaded in Belmont's cross-complaint and the allegations therein were sufficiently supported by the testimony of Belmont. Under the circumstances shown, the finding and award of the trial court in respect to such damages was not error. Anaheim Citrus Fruit Ass'n v. Yeoman, 51 Cal.Appp. 759, 761, 197 P.2d 959.

Judgment affirmed.

MUSSELL, Justice.

BARNARD, P. J., and GRIFFIN, J., concur.

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