AMERICAN INDUSTRIAL SALES CORPORATION v. AIRSCOPE

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District Court of Appeal, Second District, Division 3, California.

AMERICAN INDUSTRIAL SALES CORPORATION, a corporation, Plaintiff and Respondent, v. AIRSCOPE, Inc., a corporation, Defendant and Appellant.

Civ. 20142.

Decided: October 05, 1954

Woodrow W. Baird, Long Beach, for appellant. Lane & Lane, Long Beach, for respondent.

The complaint in this action alleged that on or about June 20, 1952 plaintiff sold to defendant under written contract airplane engine parts and components and airplane parts for $100,000, payable $20,000 down and the balance on or before June 20, 1953 on which purchase $80,000 remained due and unpaid. Defendant filed an answer and a counterclaim. An attachment was issued and levied on certain property of the defendant.

A motion to discharge the attachment was made upon the ground that the same was improperly and illegally issued in that the contract sued upon was made in the State of Florida and all payments thereunder were to be made in the State of Florida. The affidavit of one C. T. Perrin, secretary and treasurer of defendant, was filed in support of the motion. This affidavit incorporated a copy of the agreement in question. Counter affidavits of C. D. Richardson and Leonard J. Kuyper were filed in opposition to the motion. These affidavits by reference identified the copy attached to the Perrin affidavit as the agreement of the parties. The matter was heard on the affidavits, the pleadings and other records in the action. After the hearing the court made an order reading: ‘After argument by counsel defendant's motion to discharge attachment and defendant's motion to reduce excessive attachment are denied.’ Defendant appeals from the order denying its motion to discharge the attachment.

The question involved is stated as follows: ‘Can an attachment be levied in this action by a Florida corporation, plaintiff, against a California corporation, defendant, for money on a written contract made in Florida for goods delivered in Florida which contract is silent as to the place of payment?’ The agreement contained the following provisions: (1) The subject of the sale was ‘the entire Pratt and Whitney Inventory’ of the seller located in warehouses in Miami, Florida; (2) The price was $100,000 of which $20,000 was as be paid down and the balance of $80,000 as follows: Airscope was to retain the first $20,000 received from the sale on either of said inventories; one-half of all money received from any and all additional sales should be paid to American up to $80,000; in the event 50 per cent of said sums should not equal 80 per cent at the end of 6 months Airscope was to pay the balance in 6 equal payments beginning at the end of the seventh month and ending with the twelfth month; there was a guaranty as to identity of the merchandise; American was to assist Airscope in removal of both inventories to another location in Miami; Airscope was to furnish a record of sales; American's share of sales receipts was to be paid to it not later than 10 days after receipt of the money by Airscope; American would have the right to inspect balance of inventories and Airscope's books and records of sales. The agreement contained the following provision: ‘Because of the admitted inability of either party to this agreement to know in advance the condition, or circumstances surrounding, the future market for the material contained in these two inventories, it is hereby agreed that nothing outlined above shall constitute a restriction or limitation so far as Airscope, Inc., is concerned so long as minimum guarantees are met or exceeded. The inventories may be retained in Miami, or moved to Long Beach or Los Angeles Area, California, at any time that such removal would be deemed by Airscope to be more economical from an operational standpoint. Likewise, the entire balance due under this agreement may be paid in full at any time Airscope, Inc., elects, even though it exceeds the fifty-percent and/or minimum payments outlined above.’

The affidavit of Perrin referred to the agreement and stated that all sums thereunder were to be paid in Florida. The affidavit of Richardson stated that he was Vice-President and General Manager of American; that no part of the $80,000 had been paid; that the contract was prepared by Perrin, Secretary and Treasurer of Airscope; Perrin in the negotiation of the contract requested that Airscope be given the right to remove the property to a Long Beach or Los Angeles area for resale; Perrin stated that American could inspect the books of Airscope at any time and that payments would be made to American's representative in California of any money found to be due and that payment of the same would be made to such agent by certified or cashier's check; that American would have the right to keep an agent in Airscope's plant for the purpose of checking on sales. It was also stated that shortly after the agreement was made the property was removed to Long Beach and has remained there ever since; that American sent a duly authorized agent to California but Airscope refused to pay any sum to said agent; that Airscope has sold part of the property but has remitted none of the proceeds of sales; that American relied upon the statements and promises of Perrin and otherwise would not have entered into the contract. The affidavit of Kuyper stated that he was present during the negotiation of the contract; that Richardson questioned Perrin as to how American would enforce its contract or receive its money if the property were removed to Long Beach and that Perrin replied that American could send affiant its accountant to Long Beach to examine the books and that any amount found due to American would be paid to affiant or that if American placed an agent in Airscope's plant any sums found due would be paid to such agent as each sale was made and collection effected therefor. Richardson replied to the effect that if the property was removed to California he would want to have an agent present to check sales and collect money due.

Section 537, Code of Civil Procedure provides, in part, that plaintiff may have the property of the defendant attached ‘In an action upon a contract, express or implied, for the direct payment of money, where the contract is made or is payable in this State, * * *.’ The affidavit for attachment is not contained in the record. It will be assumed that it stated sufficient facts.

It is not questioned that the contract was made in Florida. The contract did not specify a place of payment. Plaintiff therefore was not entitled to an attachment unless the sums to fall due were payable in this State. It was necessary in order to give a right to an attachment that the agreement itself provide for payment in this State. Dulton v. Shelton, 3 Cal. 206; Tuller v. Arnold, 93 Cal. 166, 28 P. 863; Eck v. Hoffman, 55 Cal. 501; Drake v. De Witt, 1 Cal.App. 617, 82 P. 982; Atwood v. Little Bonanza, etc., Co., 13 Cal.App. 594, 110 P. 344. The agreement contained no such provision. Since the agreement was made in Florida and no place of payment was specified the sums falling due would have been payable in Florida. Such a provision was implied by law. It is stated in 70 C.J.S., Payment, § 6, page 217, that ‘In the absence of agreement to the contrary, a debt is payable where the creditor resides, or at his place of business, if any, or wherever else he may be found; and ordinarily it is the duty of the debtor to seek the creditor for the purpose of making payment unless provided otherwise by statute.’ The text is supported by numerous authorities. Konig v. Associated Almond Growers, 37 Cal.App.2d 360, 366, 99 P.2d 678, 681, says: ‘In the absence of any agreement or stipulation to the contrary, a debt is payable at the place where the creditor resides or wherever else he may be found.’ In Pacific Freight Lines v. Pioneer Exp. Co., 39 Cal.App.2d 609, 614, 103 P.2d 1056, 1059, the court said: ‘It is the general rule that ‘a debtor who is indebted on a money obligation is bound, if no place of payment is specified in the contract, to seek the creditor, and make payment to him personally’. People ex rel. Columbine Mercantile Co. v. District Court, 70 Colo. 540, 203 P. 268, 269. To the same effect see Bank of Yolo v. Sperry Flour Co., 141 Cal. 314, 74 P. 855, 65 L.R.A. 90; Fitzhugh v. University Realty Co., 46 Cal.App. 198, 201, 188 P. 1023; Kaupke v. Lemoore Canal, etc., Co., 7 Cal.App.2d 362, 365, 46 P.2d 204.' See, also, Clark v. Policy-Holders' Life Ins. Ass'n, 138 Cal.App. 505, 32 P.2d 653. It is not and could not be reasonably contended that evidence of the oral agreement was admissible to resolve an ambiguity or uncertainty in the writing. There was no ambiguity or uncertainty. The money was payable in Florida under the agreement and in this respect it was complete as it was written. Since the writing was complete in itself and imposed upon Airscope a duty to pay the money in Florida an oral agreement for its payment in California would be in direct contradiction of the legal effect of the writing and therefore incompetent to vary the terms thereof. In a case involving similar facts the court said in Atwood v. Little Bonanza, etc., Co., 13 Cal.App. 594, 596, 110 P. 344, 345, supra: ‘The right to an attachment in any event depends upon the contract being for the direct payment of money, ‘and it is essential to such right that the agreement itself contain some provision indicating that such money was payable in this state.’ Drake v. De Witt, 1 Cal.App. [617] 618, 82 P. 982; citing, in support, Dulton v. Shelton, 3 Cal. [206] 208; Eck v. Hoffman, 55 Cal. [501] 502. Accepting this as the rule, and the terms of the note being admitted, it follows that no evidence was competent which undertook to change or modify the language of the instrument. Whatever may have been the understanding of the parties as to the place of payment, they are concluded by the terms of their written contract and the legal presumptions attaching thereto, whenever they invoke the attachment laws of this state. No conflict arising, therefore, from competent evidence, we are constrained to hold that as a question of law the writ of attachment should have been dissolved, and that the court erred in denying such motion.'

The case may be viewed in another aspect. Plaintiff seeks to justify the receipt of evidence of the oral agreement by citation of the rule that a contemporaneous oral agreement may be proved where the instrument does not purport to be a complete statement of the agreement of the parties. See Love v. Gulyas, 87 Cal.App.2d 608, 197 P.2d 405. This contention weakens plaintiff's principal position. If the oral agreement was valid for the reason that it related to features of the understanding which the writing did not purport to cover, it was a separate agreement which was not the subject of the action or the basis of the attachment.

The right to an attachment being statutory is strictly limited to the situations specified in the statute; the court is without power to allow its use in other situations. It is the nature of the cause of action that determines whether the plaintiff is entitled to an attachment, and an attachment will be discharged on motion if it is determined that the cause of action upon which the suit was founded is one on which an attachment is not allowed, or if there is a material variance between the allegations of the affidavit and the facts developed on the motion. Ralphs v. Burns, 22 Cal.App. 153, 133 P. 997; De Mirjian v. Ideal Heating Corp., 91 Cal.App.2d 905, 206 P.2d 20; Stowe v. Matson, 94 Cal.App.2d 678, 211 P.2d 591.

Plaintiff was suing on the written contract. The complaint alleged the essential terms of that contract. Neither the complaint nor the affidavit set out an oral agreement to the effect that if the property was removed to California and if plaintiff sent an agent to California defendant would pay the agent whatever sum or sums should be found due. In resisting the motion to discharge the attachment plaintiff did not rely upon the written contract but upon the alleged contemporaneous oral agreement. It could not sue and obtain an attachment upon a contract which gave it no right to an attachment and successfully resist a motion to discharge upon the ground that it had some other and different contract with the defendant.

The order denying the motion to dissolve the attachment is reversed.

SHINN, Presiding Justice.

PARKER WOOD and VALLEE, JJ., concur.