M. E. HULSE, Individually and doing business as Hulse Import Co., Plaintiff, Cross-Defendant, and Appellant, v. JUILLARD FANCY FOODS CO., a corporation, Defendant, Cross-Complainant, and Respondent.
We hold here that the purchase order involved constitutes an integration of part of the terms of the agreement between the parties and, being clear and unambiguous in its language, cannot be varied by parol evidence. While we deem it unnecessary for the trial court to take further evidence, our holding on the above pivotal issue will require the court upon remand of this cause to make adequate findings and draw proper conclusions in conformity with the views we express herein. Additionally we conclude that plaintiff's several claims of prejudicial error and abuses of judicial discretion are either resolved by our above holding or in the light of the record are without merit. We therefore reverse the judgment with directions to the trial court as set forth in detail infra.
Plaintiff does business in San Francisco under the name of Hulse Import Co. (hereafter called Hulse) and is an importer of various food products and alcoholic liquors. Among these have been the products of a French company, Get Freres (hereafter called Get), which produces and exports foods and liquors from France, and for which company plaintiff has been agent for many years in the sale of alcoholic beverages. In February 1959, plaintiff secured from Get an exclusive agency for the sale and distribution in the United States of Get Freres Mint Syrup, a non-alcoholic beverage. Plaintiff thereupon approached defendant Juillard Fancy Foods Co. (hereafter called Juillard), a California corporation engaged in the business of importing food specialities, to the end of having Juillard become plaintiff's exclusive distributor of the above syrup in the states of California, Oregon, Washington and Hawaii.
At some time prior to February 27, 1959, plaintiff telephoned Leroy Cramer, defendant's vice-president and general manager, informed the latter about the syrup and of the desirability of marketing it through a ‘fancy food house’ and made arrangements to submit samples of it to Juillard. Shortly thereafter plaintiff visited Cramer at Juillard's place of business, furnished further information about the product and left a sample of it.
A second meeting at Juillard's office followed about a week later. On this occasion the parties discussed possibilities of a sale and the price of the syrup, plaintiff leaving a price schedule of the product. Cramer then noticed that the price for the small size of the syrup was quoted in cases of 24 half liters and thereupon mentioned to plaintiff that Juillard's trade would not buy full cases of 24, that almost everything they purchased was in units of 12 and that unless the syrup could be thus packed, Julliard would not be interested in it. Cramer agreed on behalf of defendant to pay 20 cents case extra if the merchandise could be secured packed in cartons of 12 units.
Plaintiff met again with representatives of Juillard at the latter's place of business on February 27, 1959. In addition to Cramer, there were present Alexander Greenwich, defendant's president and Harold Thies, its sales manager. These three constituted Juillard's buying committee for new items of merchandise.
There is a sharp conflict in the evidence as to what transpired at the above meeting. Plaintiff testified on direct examination that he went to Juillard's office for the sole purpose of securing an order; that Cramer guaranteed Hulse a purchase of 2500 cases on the original purchase order of which Cramer was taking 500 cases of the half-liter size and 100 cases of the liter size; that Cramer then called into his office Otto Kaasch, defendant's purchasing agent and instructed the latter to issue a purchase order for the above number of cases and to put a memo on the bottom of the purchase order ‘that would protect us against the purchasing of 2500 special cases, bottles and labels'; and that Kaasch then went out to his desk in the main office, prepared the purchase order, returned and handed it to Cramer who, after examining it, turned it over to plaintiff.
Juillard's printed form of purchase order, introduced as an exhibit below, has been brought before us. Dated February 27, 1959, and issued to Hulse, it covers ‘500 Cs Get Freres Mint 12/1/2 Liter and 100’ cases of the same merchandise ‘12/1 Liter.’ Immediately below appears the following: ‘Direct Import Basis! We guarantee the sale of 2500 cases of the 1/2 liter size within a twelve month period.’ No prices are stated. Spaces provided for terms and shipping instructios (‘F.O.B. TERMS SHIP VIA’) are left blank. The order is signed by Kaasch.
On cross-examination there was a slight variance in plaintiff's testimony: this time plaintiff testified that Cramer went out to Kaasch's desk and instructed the latter what to write on the purchase order, leaving plaintiff alone in Cramer's office. Plaintiff also denied that there was a discussion about paying for empty cartons and that he had dictated any part of the purchase order to Kaasch.
As we have indicated, the testimony of Cramer, Greenwich, Thies and Kaasch differed from that of plaintiff. That of the first three is substantially the same: that as the buying committee they decided to purchase 250 cases of the smaller (half liter) size and 100 of the larger (one liter) size; that ‘Hulse asked us to make it 500, and we agreed to it’; that they told him that they would accept the distributorship only on an exclusive basis and then only for a trial period of approximately one year, to which Hulse agreed; and that the parties discussed the territory for the distributorship as embracing ‘the eleven Western States, Alaska, and Hawaii.’
When Juillard's representatives had reached the above decision, Kaasch was called into the office and told to write out the purchase order for the above quantities and description of the syrup. Kaasch did so and also added the words ‘Direct Import Basis' which, he testified was his customary procedure when no brokerage was involved. He prepared the order in triplicate, handing the original or white copy to Cramer and retaining the other two. All three members of the buying committee testified that there was a discussion with plaintiff to the effect that in order to take care of the initial order, it would be necessary for the manufacturer to run a minimum quantity of 3000 cases of the special size (12 units to a carton) which Juillard's trade required. According to their testimony, plaintiff then asked them what assurance could be given that Juillard would use up 3000 cases, whereupon it was explained to plaintiff that it was Juillard's policy ‘to pay for and buy any cases that were never used, * * *’ Plaintiff then requested that such guarantee be put in writing. Although varying somewhat in detail, all three witnesses testified substantially that Kaasch was instructed as to the additional provision on the purchase order and Hulse himself went out with Kaasch and dictated it.1
The 600 cases ordered by defendant arrived on July 1, 1959. In the meantime, Juillard had begun its promotional work on the syrup and distributed advertising material among its trade. Actual selling took place after the arrival of the shipment. Initially the syrup was sold outright to defendant's accounts; later when it was discovered that the merchandise was not ‘moving,’ it was distributed on consignment. In October 1959, plaintiff wrote defendant complaining that the latter apparently did not intend ‘to purchase to accomplish resale of the agreed minimum of the 2500 cases of 1/2 liter size within twelve months from February 27th, 1959.’ Defendant did not answer the letter.
On May 13, 1960, plaintiff filed his complaint for breach of contract in two counts: the first count alleging defendant's failure to purchase not less than 2500 cases of the half-liter size within a year from February 27, 1959, sought damages in the sum of $16,400; the second count, realleging all allegations of the first, and alleging defendant's failure to accomplish suitable distribution and placement of the product throughout the agreed territory, sought damages in the sum of $40,000.2
Defendant filed an answer and cross-complaint. In the answer it denied that it had entered into a contract as alleged in the complaint and in an affirmative defense alleged that on or abount February 27, 1959, the parties ‘entered into an oral agreement’ under which, among other things, plaintiff gave defendant an exclusive distributorship for the syrup, agreed to supply defendant with the half-liter size packed in cases of 12 bottles upon condition that defendant would guarantee the payment for 2500 cartons of such size manufactured for defendant's use, and agreed to pay defendant a certain sum of money for advertising materials.3 Defendant's cross-complaint sought recovery of $533.85 for promotional expense incurred under such agreement. However in the cross-complaint, it was alleged that the parties had ‘entered into an oral and partly written agreement.'4
The trial court found and concluded, so far as is here pertinent, that the parties had entered into the oral agreement as alleged by defendant; that defendant had fully paid for the 600 cases ordered and received but had not paid for the additional 2500 cartons since plaintiff had not informed defendant of their cost and value, had made no demand therefor on defendant and had not alleged or prayed for such damage; that defendant had fully performed all of the terms of the agreement;5 and that defendant had expended the sum of $533.85 for advertising materials. Judgment was entered accordingly, denying all relief to Hulse on its complaint and awarding the sum of $533.85 to Juillard on its cross-complaint.
Plaintiff's contentions before us may be summarized as follows: (1) that since defendant breached its express undertaking to ‘guarantee the sale of 2500 cases within a 12-month period,’ the trial court was not free to find otherwise; (2) that the uncontradicted evidence demonstrates defendant's breach of its obligations as plaintiff's exclusive distributor; (3) that even on defendant's theory of pleading and proof, plaintiff s entitled to the cost of the packaging of 3000 cases; (4) defendant's recovery on its cross-complaint cannot be sustained, in view of its admission of its failure to perform the contract; and (5) that the trial court committed prejudicial error and abuses of discretion which vitiate the judgment in all events.
The gist of plaintiff's argument in support of his first contention is this: defendant's purchase order is a partially integrated contract; to the extent so integrated, such contract cannot be contradicted by parol evidence; the meaning of the guarantee provisions of the purchase order is plain; and the trial court was therefore not free to find upon the parol evidence received that the guarantee provisions meant something else.
We must first resolve some preliminary matters. It is to be noted that plaintiff does not contend that there has been an integration of the entire agreement between the parties and that they have embodied its complete terms either in the above purchase order or in any other writing or writings. (See Estate of Gaines (1940) 15 Cal.2d 255, 264–265, 100 P.2d 1055; Civ.Code, § 1625; Code Civ.Proc. § 1856; Rest., Contracts, § 228.) As we have already set forth, plaintiff declared upon an oral contract, confirmed by defendant by the writing dated February 27, 1959, namely the purchase order. (See footnote 2, ante.) This was also established by the pretrial conference order. In effect, then, plaintiff takes the position that his contract with defendant rests partly in parol and partly in writing. In this last respect, he claims that it is partially integrated and that to such an extent the parol evidence rule is operative. Defendant does not meet this issue squarely and at times argues under the misapprehension that plaintiff relies on the purchase order ‘as a wholly integrated contract.’
‘An agreement is integrated where the parties thereto adopt a writing or writings as the final and complete expression of the agreement. An integration is the writing or writings so adopted.’ (Rest., Contracts, § 228.) As was said in the Estate of Gaines, supra, 15 Cal.2d 255, 264–265, 100 P.2d 1055, 1060 the parol evidence rule ‘as applied to contracts is simply that as a matter of substantive law, a certain act, the act of embodying the complete terms of an agreement in a writing (the ‘integration’), becomes the contract of the parties. * * * The rule comes into operation when there is a single and final memorial of the understanding of the parties. When that takes place, prior and contemporaneous negotiations, oral or written, are excluded; or, as it is sometimes said, the written memorial supersedes these prior or contemporaneous negotiations. [Citations.]'
However, there may be only a partial integration: that is, only a certain part of a transaction may be embodied in a writing and the remainder left in some other form, e. g., in parol. (Rest., Contracts, § 229; 9 Wigmore Evidence (3d ed.) § 2430; McCormick on Evidence (1954 ed.) pp. 432–433; 4 Williston on Contracts (3d ed.), § 633, pp. 1010–1016; § 636, p. 1035; Witkin, Cal.Evidence, p. 402.) The parol evidence rule ‘is not calculated to, nor does it in practice, exert any compulsion upon the parties to put their entire understanding in writing.’ (Mangini v. Wolfschmidt, Ltd. (1958) 165 Cal.App.2d 192, 198, 331 P.2d 728; Spurgeon v. Buchter (1961) 192 Cal.App.2d 198, 203, 13 Cal.Rptr. 354.) A contract may be partly written and partly oral in the sense that both oral and written evidence may be received to establish the terms of the agreement between the parties. (Lande v. Southern Cal. Freight Lines (1948) 85 Cal.App.2d 416, 420, 193 P.2d 144; see McCormick, op. cit., § 212, pp. 432–433.) Where there has been a partial integration or more precisely an integration of part of the terms of the contract, parol evidence, while admissible to prove that part of the contract not reduced to writing, is not admissible to vary or contradict that part which is. (Rest., Contracts, § 2396 ; Wigmore, op. cit., § 2430; Witkin, op. cit., p. 402; Sivers v. Sivers (1893) 97 Cal. 518, 521, 32 P. 571; Pierce v. Edwards (1907) 150 Cal. 650, 654, 89 P. 600; Keeler v. Murphy (1931) 117 Cal.App. 386, 390–391, 3 P.2d 950; Smith v. Bear (2 Cir.1956) 237 F.2d 79, 85, 60 A.L.R.2d 1119 (declaring California law); 18 Cal.Jur.2d, Evidence, § 258, p. 743; 20 Am.Jur., Evidence, § 1135, pp. 988–989.) Wigmore, supra, states that in this situation ‘obviously the rule against disputing the terms of the document will be applicable to so much of the transaction as is so embodied, but not to the remainder.’ (P. 97.) Witkin capsulizes the rule thusly: ‘The parties may reduce only a part of their agreement to writing, leaving the rest to their oral understanding. In such a case it has been said that the integrated part is protected by the parol evidence rule in the same manner as if the whole contract were integrated.’ (P. 402.)
Thus the companion rule governing the admission of evidence to prove that part of the agreement not reduced to writing, is formulated on the express premise that such evidence must not at the same time contradict or be inconsistent with the terms of the writing. As the court said in American Industrial Sales Corp. v. Airscope, Inc. (1955) 44 Cal.2d 393, 397, 282 P.2d 504, 506, 49 A.L.R.2d 1344: ‘It has long been the rule that when the parties have not incorporated into an instrument all of the terms of their contract, evidence is admissible to prove the existence of a separate oral agreement as to any matter on which the document is silent and which is not inconsistent with its terms. [Citations.]’ (Emphasis added; see also Sivers v. Sivers, supra; Buckner v. A. Leon & Co. (1928) 204 Cal. 225, 227, 267 P. 693; Crawford v. France (1933) 219 Cal. 439, 443, 27 P.2d 645; Lindsay v. Mack (1935) 5 Cal.App.2d 491, 496–497, 43 P.2d 350; McKee v. Lynch (1940) 40 Cal.App.2d 216, 226, 104 P.2d 675; Bowman v. Santa Clara County (1957) 153 Cal.App.2d 707, 711–712, 315 P.2d 67; Mangini v. Wolfschmidt, Ltd., supra, 165 Cal.App.2d 192, 199, 331 P.2d 728.)
Applying the above principles to the case before us, it is manifest that the purchase order issued to Hulse by Juillard is an integration of part of the terms of the agreement between the parties. We are not presented here with the task of determining whether a writing apparently complete on its face is nevertheless only a partial integration, frequently a complex question when examined in the light of the California ‘face of the document’ test. Neither party asserts that the document involved is an integration of the entire contract. This is not a case where all integration is precluded by virtue of the fact that the writing relied upon is of a noncontractual nature. (See Kreuzberger v. Wingfield (1892) 96 Cal. 251, 255, 31 P. 109; India Paint & Lacquer Co. v. United Steel Prod. Corp. (1954) 123 Cal.App.2d 597, 607–608, 267 P.2d 408; 3 Corbin on Contracts (1960 ed.) § 588, p. 522, et seq.) The purchase order before us is clearly contractual in nature. It constitutes a written offer to purchase goods which, when accepted and acted upon by the seller, becomes binding on both parties. (Remsberg v. Hackney Manufacturing Co. (1917) 174 Cal. 799, 802, 164 P. 792.) Since the order is not here attacked on the grounds of fraud or mistake or otherwise questioned as to its validity, we conclude, as plaintiff correctly contends, that by virtue of the operation of the rule explained above it is immune from contradiction by parol evidence. Defendant therefore could not show that the guarantee provisions of the order were intended to mean something else, any more than it could show that it had intended to place a different order than that covering the 600 cases described therein. ‘Although parol evidence is ordinarily admissible to explain the meaning of an agreement, it is not admissible when it is offered, as here, to give the terms of the agreement a meaning to which they are not reasonably susceptible, and this is especially true where the evidence consists of a declaration of a party as to what he intended the language of the specific document to mean. [Citations.]’ (Imbach v. Schultz (1962) 58 Cal.2d 858, 860, 27 Cal.Rptr. 160, 162, 377 P.2d 272, 274.) We conclude therefore that testimony introduced below to the effect that the guarantee contained in the purchase order of a ‘sale of 2500 Cases of the 1/2 liter size within a twelve month period’ in fact meant and purported to set forth a guarantee ‘for the payment for . . . (2,500) carton containers especially manufactured for the defendant’ was erroneously admitted in violation of the parol evidence rule.
Juillard contends that the objectionable evidence was nevertheless admissible to interpret the purchase order. It argues: that it ‘simply tried to explain the terms of the agreement’; that the parol evidence rule does not apply to the purchase order ‘which is a mere memorandum’; and that therefore ‘the trial court was free to find the meaning of the language contained in the memorandum, . . .’ This contention has no merit. The record is far from clear that defendant offered the evidence in question to explain an ambiguous document or that the trial court, finding such ambiguity, received the evidence for such purpose. It makes no difference that we find no express ruling on this point. ‘In construing a contract, the question whether an uncertainty or ambiguity exists is one of law, and the lower court's finding on this issue is not binding on appeal.’ (Brant v. California Dairies, Inc. (1935) 4 Cal.2d 128, 133, 48 P.2d 13, 16; Neff v. Mutual Life Ins. Co. (1941) 48 Cal.App.2d 110, 112, 119 P.2d 404; Crow v. P. E. G. Construction Co., Inc. (1957) 156 Cal.App.2d 271, 278, 319 P.2d 47; Cook v. Penn Mutual Life Ins. Co. (1963) 218 A.C.A. 210, 214, 32 Cal.Rptr. 400.
‘If the language of the instrument is clear and explicit the intention of the parties must be ascertained from the writing alone. Parol evidence is admissible only where the language used is doubtful, uncertain or ambiguous and only then in cases where the doubt appears upon the face of the contract. [Citations.]’ (Eastern-Columbia v. System Auto Parks (1950) 100 Cal.App.2d 541, 545, 224 P.2d 37; 40 Bartel v. Associated Dental Supply Co. (1952) 114 Cal.App.2d 750, 752, 251 P.2d 16; Crow v. P. E. G. Construction Co., Inc., supra.) But where the terms of an agreement are set forth in writing, and the words are not equivocal or ambiguous, the writing or writings will constitute the contract of the parties, and one party is not permitted to escape from its obligations by showing that he did not intend to do what his words bound him to do.' (Brant v. California Dairies, Inc., supra, 4 Cal.2d 128, 134, 48 P.2d 13, 16.) In such instances, as Justice White observed in the Crow case, supra, ‘it is not within the province of a court to rewrite or alter by construction what has been agreed upon [citations]. The function of a judge in the construction of an instrument is set forth in Section 1858 of the Code of Civil Procedure, and the method of discharging that function is contained in Sections 1643 and 1654 of the Civil Code. It is only in those cases where upon the face of the written contract itself there is doubt that resort may be had to the surrounding circumstances to dispel such doubt, not by showing that the parties meant something other than what they said but by showing what they meant by what they said [citations].’ (156 Cal.App.2d 271, 278, 319 P.2d 47, 51.)
The provisions of the purchase order here in controversy are explicit and unambiguous. By its terms, Juillard ordered 500 cases of Get Freres mint in the one-half liter size and 100 cases of such product in the one liter size. In addition Juillard guaranteed the sale of 2500 cases of the one-half liter size within a twelve-month period. It is clear that the order was placed for 600 cases of syrup and not merely 600 empty containers. There is no reason for concluding that the word ‘cases' appearing in the guarantee is used in a different sense. To show that in the latter instance ‘cases' means something entirely different, that is ‘empty cartons,’ is to contradict the clear meaning of the language. If this language had been intended to express a promise to pay the cost of manufacturing 2500 unused cartons, the parties could have very easily so provided. To insert such language into the purchase order would be to rewrite it.
Has plaintiff properly raised in this court such violations of the parol evidence rule? He argues: first, that he made timely and adequate objection to the offending testimony in the court below; and, secondly, that even in the absence of an objection such testimony must be disregarded. As to the latter point, we observe, as Witkin points out (Witkin, Cal.Evidence, pp. 399–400), that decisions in California and elsewhere have been in great conflict on the question whether violations of the parol evidence rule can be raised for the first time on appeal. However it now appears to be the settled rule in California that ‘the admission of parol evidence to vary or add to a written instrument cannot be objected to for the first time in the appellate court.’ (Pao Ch'en Lee v. Gregoriou (1958) 50 Cal.2d 502, 506, 326 P.2d 135, 137, and cases there collected; Tsarnas v. Bailey (1960) 179 Cal.App.2d 332, 338, 3 Cal.Rptr. 629; Santa Clara Properties Co. v. R.L.C., Inc. (1963) 217 A.C.A. 903, 912, 32 Cal.Rptr. 333.) The Supreme Court in Pao Ch'en Lee expressly disapproves Lifton v. Harshman (1947) 80 Cal.App.2d 422, 182 P.2d 222, relied upon by plaintiff herein. As we pointed out in Santa Clara Properties, while Pao Ch'en Lee does not specifically include in its disapproval other California decisions holding that evidence violating the parol evidence rule should be disregarded on appeal even though not objected to in the trial court, nevertheless Lifton relied on such other cases so that it can be safely concluded that they too are under the anathema.
We must therefore determine whether plaintiff made a proper objection below. Plaintiff himself was the principal witness in his own behalf.7 He testified at length to the negotiations between the parties and to the events leading up to the oral agreement and purchase order. During his testimony the purchase order was introduced in evidence without objection. Plaintiff then called his assistant manager and, upon the conclusion of the latter testimony, rested. Defendant's first and chief witness was its vice-president Cramer. On direct examination, Cramer generally gave his version of the negotiations and of the events leading up to the oral agreement and purchase order. Cramer was called on the second day of the trial; direct examination was not completed on that day (Monday, February 26, 1962). Shortly before adjournment he testified to the discussions pertinent to the special cartons, Juillard's policy of paying for unused special cartons, the preparation of the purchase order, and to the subsequent addition thereto of the guarantee provisions here in controversy.8 All of this testimony was admitted without objection. The trial was then continued until Wednesday, February 28, 1962.
On that day, direct examination of Cramer being resumed, he testified, in response to the first two questions and without objection, to discussions between the parties as to the amount of syrup to be ordered. The following then took place: ‘Q. And was there any discussion between you, Mr. Hulse and you, relative to placing an order for 2,500 cases of twelve one half liter size Get mint syrup? MR. HUTCHINSON: We'll object, if your Honor please, it's outside the issues, attempting to modify a written document which is admitted in the answer, and setup with a copy in the answer. They made an agreement and it's complete as to that phase of it. THE COURT: Overruled, you may proceed.’
Examining the pertinent testimony broadly, we are not prepared to say that the portion introduced prior to adjournment on the preceding day (see footnote 8, ante) was so directly at variance with the written instrument as to be per se violative of the applicable rule and, absent an objection, to constitute competent evidence in the record for all purposes. The record does not indicate for what purpose defendant was offering such testimony. Clearly, as we have explained supra, testimony dealing with the negotiations of the parties was admissible to prove that part of the agreement resting in parol so long as it did not contradict that part resting in the writing. Taken in context, the preceding day's testimony, in our view, was not sufficiently on the point to offend the rule but at the most was on the borderline. On the following day, the probe of the questioner hit the nerve center and aroused the prompt response of the objection. We think the objection was timely under the circumstances. Defendant does not raise any issue on the point.
Since plaintiff's objection was overruled, it was not incumbent upon him to repeat it as the occasion arose during the testimony either of the above defense witness or any of the following witnesses called by defendant. Where an objection to evidence is distinctly made and overruled the objection need not be repeated either when the same question is repeated or when evidence of the same class is offered, whether by the same or by a different witness. (Moore v. Norwood (1940) 41 Cal.App.2d 359, 368–369, 106 P.2d 939; Wilcox v. Sway (1945) 69 Cal.App.2d 560, 570, 160 P.2d 154.) The force of the objection therefore extended to any testimony of the three following defense witnesses which tended to contradict the document involved. Actually, as our summary of the evidence indicates, all of this testimony was generally cumulative to that of Cramer.9 We hold therefore that testimony offered to vary the guarantee provisions of the purchase order was not admissible, that proper objection to such testimony had been asserted at trial, and that such testimony could not be considered by the court for such purpose.
We take up plaintiff's second contention. On this issue he urges that defendant, in addition to failing to perform his express guarantee to sell 2500 cases, also breached its general undertakings as an exclusive distributor. Plaintiff claims that this is established by uncontradicted evidence in the record. The pertinent findings of fact are important: The court found in terms of the complaint that except as to the provision dealing with the purchase of 2500 cases of one-half liter size syrup (discussed, supra) the parties had entered into an oral agreement as alleged by plaintiff. (See footnote 2, ante.) An essential part of this oral agreement as so found by the court was defendant's undertaking ‘to accomplish distribution of said products within the States of California, Oregon, Washington and Hawaii, and to use its best efforts to accomplish distribution, to resell the maximum amount of these products possible by means of defendant's best efforts, * * *’ Although the next finding of fact (Finding III) is largely repetitive and sets forth specifically the terms of such oral agreement, it makes no mention of defendant's undertaking quoted above. Nevertheless the preceding finding (Finding II) is not inconsistent therewith and the two findings must be read together. Suffice it to say at this point, that defendant had the general obligation delineated above.
The above obligation or general undertaking of defendant is thereafter used as a basis of a breach in two instances: (a) For the charge in the first count that defendant did not use its best efforts to promote and solicit sales and did not perform the undertakings and conditions of his contract; and (b) for the charges in the second count that because of defendant's above failure to perform, plaintiff was required to effectuate promotion, distribution and sale of the product himself. The court found against plaintiff in both respects.
If we had concluded that defendant should prevail on the first issue raised before us relative to the guarantee provisions of the purchase order and were presented only with the question as to whether the court's findings pertaining to the general undertaking of the distributorship found substantial support in the evidence, we would have no hesitancy in concluding that they were so supported. Both Cramer and Thies testified to the steps taken by Juillard to promote and distribute the syrup. Both stated that, despite the efforts of Juillard, the syrup proved to be an unsuccessful product in the market. This evidence we think would justify the court in finding that defendant had not failed to perform its general undertaking as a distributor.
However, in view of the conclusion we reach as to the terms of the purchase order, the above issues must be re-examined by the trier of fact in a different light. The court below must now determine whether, in view of our holding on the first issue, defendant breached its agreement with plaintiff by not selling 2500 cases of the syrup in one-half liter size. It must also determine upon such re-examination of the evidence, whether defendant breached its agreement by failing to perform its general undertaking as a distributor. The trial court may conclude that these matters are severable and, while finding adverse to defendant on the first, conclude that nevertheless defendant did not fail to perform its general undertaking. On the other hand, the trial court may consider these matters interdependent, holding to the reasoning that a breach of the former might of itself import some failure to perform the other obligations of a distributor. We do not intimate that the findings should be one way or the other. These are matters within the competence of the trier of fact.
In view of our disposition of the instant appeal, as will appear supra, it is unnecessary to discuss plaintiff's third and fourth contentions. We proceed therefore to consider certain claims of prejudicial error and abuses of discretion allegedly committed by the trial court, which plaintiff has collected under his fifth contention on appeal. Six alleged errors are set forth. However, we need not discuss four of the alleged errors since they pertain in one way or another to the basic issue of the admissibility of the parol evidence and have been resolved by our conclusions, already explained, on this issue.10
Of the remaining two, the first is a claim that the trial court consistently ordered stricken responsive replies to defendant's questions on cross-examination. We have examined those portions of the record cited by plaintiff and are of the opinion that the answers in question were not responsive and that therefore the court's rulings striking them were correct. Plaintiff's final claim of error is that his cross-examination was erroneously curtailed ‘in several instances.’ However, plaintiff refers us to only two, occurring during the cross-examination of defendant's witness Cramer. The evidence attempted to be introduced pertained generally to the rebottling of the syrup by Juillard and the subsequent sale or distribution of it, or endeavors to sell and distribute it under Juillard's own labels. On the sustaining of defendant's objections to the two questions involved, plaintiff stated that he was attempting to show that Juillard was ‘pirating the custom’ and was ‘substituting material under their own labels.’ However, we feel that plaintiff was permitted to explore the general subject of Juillard's activities in rebottling and relabeling the syrup to a sufficient extent and that under the circumstances, particularly in a court tried case, there was no abuse of discretion arising from the two incidents called to our attention.
We therefore reach this final result: Since, as we have explained, the purchase order is a partial integration of the agreement between the parties and immune from attack by parol evidence, the trial court was not free to find, contrary to the clear meaning of its language, that it sets forth an agreement of guarantee for the payment of 2500 carton containers especially manufactured for defendant. Findings of fact (see Findings II, III and IV) and conclusions of law relative to this subject were improper because of the conclusiveness of the integration. It is obvious that the court did not find in accordance with the partial integration nor give effect to it in determining the issues raised below. The findings and conclusions are therefore inherently defective and inadequate. This necessitates a redetermination of all material issues in the light of our conclusions with respect to the purchase order.
For the above reasons, we conclude that the judgment must be reversed. However, we observe that the case was fully tried and we apprehend no need for the taking of further evidence. We find nothing in the instant record which impels us to order a new trial. Under the above circumstances, it is appropriate to remand the cause with directions to make adequate findings, based on the evidence now before it, and in conformity with the views herein expressed; to draw proper conclusions of law therefrom; and to enter judgment accordingly. (4 Cal.Jur.2d, Appeal and Error, § 670, pp. 561–562.)
The judgment is reversed with directions to the trial court to set aside the findings of fact, conclusions of law and judgment heretofore made and thereupon, having reexamined and redetermined all material issues presented by the pleadings in conformity with the views herein expressed, to make and file findings of fact thereon based upon the evidence now before it; to draw proper conclusions of law therefrom; and to enter judgment accordingly. Such findings of fact, conclusions of law and judgment shall be prepared, signed, filed and entered in the manner provided by law. Appellant shall recover costs on appeal.
1. Kaasch testified that Hulse came out to his desk and asked him to add the provision which Hulse, himself, dictated, this apparently being done without consulting Cramer.
2. In pertinent part the first count alleges that ‘on or about the 27th day of February, 1959, plaintiff and defendant entered into an oral agreement by the terms of which plaintiff appointed defendant his exclusive distributor within said States of California, Oregon, Washington and Hawaii for said products, with right to purchase and resell the same therein, and defendant undertook to accomplish distribution of said products within the States of California, Oregon, Washington and Hawaii, and to use its best efforts to accomplish distribution, to resell the maximum amount of these products possible by means of defendant's best efforts, to purchase its requirements therefor from plaintiff at his prices in effect from time to time, and to purchase and resell not less than 2,500 cases of one-half liter size of said products within twelve months from said 27th day of February, 1959; ‘That said oral contract was duly confirmed by defendant in that certain writing dated February 27, 1959, copy of which is attached hereto as Exhibit 1, and made a part hereof by reference for all purposes with the same force and effect as though herein set forth at length; * * *’ (Emphasis added.) Although the clerk's transcript does not contain such copy, it is clear from the briefs that it was a copy of defendant's purchase order dated February 27, 1959
3. A second affirmative defense raised the statute of frauds but was abandoned at trial.
4. In pertinent part the cross-complaint alleges ‘[t]hat on or about the 27th day of February, 1959, cross-complainant and cross-defendant entered into an oral and partly written agreement wherein cross-defendant agreed to give to cross-complainant the sole distribution and selling privilege of Get Freres Mint Syrup . . . and that the cross-defendant agreed to pay to the cross-complainant a certain sum, when ascertained, for advertising materials to be used for the promotion and sale of Get Freres Mint Syrup.’ (Emphasis added.)
5. We note a slight variance: in its findings, the court found ‘[t]hat the defendant has performed fully and completely all of the terms and conditions of the oral and partly written agreement . . .’ (emphasis added); in its conclusions, it stated that the ‘terms and conditions of the oral agreement and written memorandum’ (emphasis added) had been performed.
6. Rest., Contracts, § 239 states: ‘Where there is integregation of part of the terms of a contract prior written agreements and contemporaneous oral agreements are operative to vary these terms only to the same extent as if the whole contract had been integregated.’
7. There were two witnesses for plaintiff: plaintiff himself and the assistant manager for Hulse who testified to the amount due from Juillard and to the loss of profit on the 2500 cases.
8. Cramer testified thusly on the last point: ‘Q. Was there any further conversation that took place between you, Mr. Hulse, Mr. Greenwich, and Mr. Thies? A. Yes, at that time Mr. Thies asked—Mr. Hulse asked us what assurance we had that we would use these cases up, if they went ahead and made up these 3,000 cases, and we explained to him at that time that it had been our policy to pay for and buy any cases that were never used, and—Q. And what did Mr. Hulse say? A. Mr. Hulse said would we give it to him in writing. Q. And what did you say? A. We said surely we would. We would put it on the order, and he took the order, and we called Otto, and we told Otto ‘Would you please put on this order, we agree to take these 2500 cases,’ and Mr. Hulse went out. Q. All right, and further? A. Mr. Hulse went out with Otto. Otto stood at the door and went out there to his office, and dictated that phrase on there about the cases, which we agreed to do at his request.'
9. While counsel for defendant did not state the purpose of offering such testimony, a reasonable construction of portions of it leads us to the conclusion that it was designed to show that the language of the purchase order actually meant a guarantee of the expense of manufacturing special cartons for the syrup. And so the court found.
10. These claims of error are: (1) The admission of the parol evidence to vary the purchase order; (2) the court's refusal to permit plaintiff to give his ‘understanding’ of the purchase order; (3) the denial of plaintiff's motion to reopen; and (4) the inadequacy of the findings.
BRAY, P. J., and MOLINARI, J., concur.