Furlong v. White

The action was to compel defendant White to account to plaintiff for a one-half interest in the profits ensuing from the sale of certain property in

The complaint alleges that by virtue of certain instruments in writing, dated January 2, January 15, and March 12, 1917, constituting virtually the same contract, one Lott, who was the owner of said property, gave defendant White an option to purchase it. That on February 17, 1917, defendant Richard White entered into a certain contract and assignment with plaintiff, wherein it was recited that White was the owner and holder in his own name, but for the use, benefit, advantage, and profit of both parties to the agreement, of the said option; that the parties would share equally and mutually co-operate with each other in promoting a sale of the property under option, and said agreement containing this clause: “Now this indenture witnesseth that the said party of the first part (Richard White), for and in consideration of the premises, has assigned, transferred and set over to the party of the second part (H. W. Furlong) and by these presents does hereby assign, transfer and set over to the said party of the second part an undivided and equal one-half interest in and to that said above-described option from said Charles F. Lott to said Richard White as the same is evidenced by said agreements of January 2, 1917, and January 15, 1917, and the undivided one-half and equal share of interest in and to all advantages or profits to be derived from or that may accrue from said option, either by direct purchase thereunder or sale to others or otherwise. ”

The complaint then alleges that in October, 1917, defendant White entered into an agreement with the state land settlement board for the sale of said Lott ranches to said board for the sum of $165,000, and that he has failed to account to plaintiff for one-half of the profits derived from said sale. It may be added that copies of the instruments to which plaintiff refers are attached to the complaint and made a part thereof.

Defendant White in his answer admitted the execution of said option and the purported assignment on February 17, but he alleged that this latter instrument was executed

Appellant in his opening brief declares that his contention “turns wholly on the sufficiency of the findings as a matter of law, and is now concerned with the insufficiency of the evidence to support the same.” As to this, it cannot be doubted that the judgment that plaintiff take nothing follows as a logical and necessary conclusion from the facts found by the court. It is also true that these findings of fact cover all the material issues that are expressly raised by the pleadings. We deem it unnecessary to detail these findings. Indeed, the controverted facts are few. Appellant admits that the “entire controversy turns on the effect of

However, appellant’s real objection probably is that the court failed to make certain material findings that would have operated to nullify the effect of the finding as to said agreement of September 27th, and would have required the court to give full force" and effect to said agreement of February 17th according to its terms.

[1] Of these the first specification is that “the findings leave us in ignorance as to the terms of the ‘prior oral agreement,’ except in so far as we discover that the agreement of September 27th, ‘expressed the terms and conditions and intent of said prior oral agreement.’ The court erred in not making a direct finding as to the terms of this prior agreement.” Herein appellant is entirely in error. The execution of said agreement of September 27th was not denied, its terms appeared in the instrument, which was set out in full, and the court found that it contained the expression of the parol agreement. There is no uncertainty as to the terms of the contract embodied in said written instrument. The finding, therefore, leaves us in no doubt as to what said parol agreement was. But even if the finding

The other objections are entitled to more serious consideration. They relate to the validity of the said contract of September 27th. Herein appellant says: “If we can show that the September contract is invalid, then the February contract becomes the measure of the rights of the parties and the plaintiff must prevail.” It is claimed that the learned trial judge entertained a similar view as shown by his declaration: “If the agreement of September 27th had not been executed, then it would be perfectly clear that the plaintiff ought to prevail in this action.”

[2] The validity of said September agreement is assailed upon the grounds that it was without consideration and that it was secured by fraud and undue influence. These elements were not pleaded, but since said agreement appeared for the first time in the answer, it is the claim of appellant tha.t these defenses are pleaded by operation of law. The decisions are indeed to the effect that where the defendant has pleaded a written instrument in defense, the plaintiff “may controvert the instrument by evidence of fraud, mistake, undue influence, compromise, payment, statute of limitations, estoppel, and the like defenses, under section 462 of the Code of Civil Procedure.” (Moore v. Copp, 119 Cal. 429 , [ 51 Pac. 630 ].) Nor in such eases is the plaintiff required to file an affidavit setting up any such ground upon which he may rely, although such affidavit was filed herein by plaintiff.

It may be added that plaintiff was not compelled to anticipate any defense founded upon the September agreement. {Janes v. Throckmorton, 57 Cal. 368 .) However, as he knew of the execution of the subsequent agreement of September 27th, and that it was inconsistent with the terms of the February contract, it ivould have been commendable practice for him in his complaint to have expressly alleged the grounds of its asserted invalidity. If so, the court would have been less likely to overlook these elements in making the findings.

[3] It is seriously claimed by respondents, however, that appellant should be precluded from urging any such objection by reason of the fact that he had an opportunity

“After receipt by counsel for plaintiff of a copy of the trial court’s written opinion in this case, counsel for plaintiff did address a communication to the said trial judge, under date of December 14, 1918, as follows: ‘We have not been served with any copy of the proposed findings and when they are served, will desire to be heard on the settlement of the same. ’

“The said- findings of fact and conclusions of law, as finally signed by the said trial court, were served by counsel for defendants upon counsel for plaintiff on January 3, 1919.

“On January 26, 1919, the said trial judge wrote to counsel for the plaintiff as follows:

“ ‘Will you please send me any proposed amendments to the findings in the case of Furlong vs. White, which you desire to make by the last of this week. ’

“On January 29, 1919, said counsel for plaintiff did reply to the said trial judge by communication as follows:

“ ‘In re Furlong vs. White et al., I beg to acknowledge receipt of your letter of January 26th, and to advise you that we have decided not to submit any amendments to the findings as proposed.’

‘ ‘ The said findings and conclusions of law were thereupon signed and filed by the said trial judge.”

Counsel should not forget that they are officers of the court, and while it is their duty to protect and -defend the interests of their clients, the obligation is equally imperative to aid the court in avoiding error and in determining the cause in accordance with justice and the established rules of practice.

We do not think that appellant is thereby estopped" from urging the point, nor do we question the good faith of counsel, but we are of the opinion that the trial judge in denying the motion for a new trial was justified in making this comment: “In those cases where an issue arises out of the evidence rather than the pleadings, and the party in whose behalf such issue is so raised, after being served with proposed findings by the other party, remains silent as to such issue, knowing from the court’s opinion that the issue must be found against him, there is nothing in such conduct

The answer of appellant is, of course, that the court had no discretion to deny the motion, since a judgment based upon findings, which do not determine all the material issues, is a decision against law, and presents a case demanding a new trial. (Kaiser v. Dalto, 140 Cal. 167 , [ 73 Pac. 828 ].)

However, in Ms motion for a new trial he should have specifically mentioned this ground. (Kaiser v. Balto, supra; Haight v. Tryon, 112 Cal. 6 , [ 44 Pac. 318 ].)

Nevertheless, the question is reviewable upon the appeal from the judgment. (Emirzian v. Asato, 23 Cal. App. 251 , [ 137 Pac. 1072 ]; Math v. Crescent Hill Gold Mines Co., 31 Cal. App. 636 , [ 161 Pac. 140 ].)

[4] But another principle operative to defeat appellant is this: When a party relies upon this ground he must show to the appellate court not only that no finding was made upon a material issue, but also that the evidence would justify a finding in Ms favor. (Himmelman v. Henry, 84 Cal. 104 , [ 23 Pac. 1098 ].)

If the finding must have been adverse, its omission is not sufficient to authorize a reversal of the judgment. (Winslow v. Gohransen, 88 Cal. 450 , [ 26 Pac. 504 ]; Estate of Carpenter, 127 Cal. 582 , [ 60 Pac. 162 ].)

In the opening brief of counsel no quotation is made of any testimony nor is reference made to any part of the transcript in which may be found any evidence of fraud, undue influence, or want of consideration. For that reason we would be entirely warranted in assuming that no such evidence is contained therein. If parties are too indifferent to point out the evidence upon which they rely, they cannot expect an appellate court to search for it through a voluminous record. However, we have read the entire transcript and we are satisfied that this contention of appellant cannot be maintained.

[5] As to the consideration for said agreement of September 27th, the lower court was warranted in holding that no other consideration than that supporting the original

“Whereas, it is desirable and for the mutual satisfaction and protection of both parties hereto that the agreement relating to said option between them should be definitely stated and executed in writing,” etc.

It is admitted by appellant that “If the prior oral agreement was a valid and subsisting agreement at the time of the execution of the September contract, then it may well be said that the September contract required no new consideration.” We could not expect to find better evidence that it was “a valid and subsisting agreement” than the written declaration of the parties to that effect. We may add that there was abundant parol evidence, admitted without objection, as to the terms of said contract and that the purpose of the parties in executing said September instrument was simply to preserve written evidence of said original contract. But appellant replies: “We contend, however, that the September contract cannot be held to be ‘the written expression of the original contract’ for the ‘original contract’ was merged in and supplanted by the February contract and was no longer in existence.” As to this, though, the parties themselves should be the best judge. They not only declared in the September instrument, as we have already seen, that said parol contract was in force, but they also stated that the purpose and effect of the February agreement were to protect “the interests” of Furlong in said parol agreement and “the assignment to the party of the second part set out in Exhibit ‘A’ hereto annexed shall be binding upon and enforceable against the

In reference to the claim of fraud relating to the representations of White as to the meaning of the September agreement the trial judge declared: “In this connection it is important to consider the mental capacity of the two men. Both appear to be above the average in mentality. Both are of mature years and have had wide and varied experience. Both are proficient in the use and understanding of the English language.” In view of these facts we consider it highly improbable that plaintiff did not understand the significance of this final instrument.

As to undue influence, there was not between the parties the relation of attorney and client. It is true that Mr. White was and is an attorney at law, and for that reason

We are not unmindful of the contention of respondent that the findings of the court do actually cover these considerations, but we deem it unnecessary to inquire as to that.

The point is made that it was not proper to show that the February agreement was really intended as security since there was no allegation in the answer to that effect, the averment being that the February agreement was executed “as a part of the prior oral agreement.” As to this it is sufficient to say that the evidence was received without objection; in other words, the case was tried upon the theory that the question was in issue and it is now too late to contend for the contrary.' In reference to the finding upon this matter it may be said that, while it contains said language of the answer, it also recites that said agreement of February 17th was merged in and supplanted by the, written instrument of September 27th, “which said instrument of September 27, 1917, expressed the terms and conditions and intent of said prior oral agreement and said agreement of February 17, 1917, aforesaid, and is in writing and is in words and figures following, to wit.” Then follows a copy of said September agreement, which shows beyond peradventure that the parties intended the February contract to constitute security for the performance of the oral contract. Thus does the finding fully support the theory upon which the case was decided.

In the closing brief, in direct conflict with his admission in his opening brief, appellant contends that even the September instrument does not limit his right to an accounting to the situation wherein a sale should be made by himself. For the first time he asserts that, construing the instrument as a whole, it is a fair inference that he was entitled to

We are not disposed to notice specifically the decisions cited by appellant, as they involve familiar principles not in conflict with anything herein determined.

On account of the earnestness with which the able counsel for appellant have urged their contentions we have considered them somewhat at length, but we find no substantial reason for reversing the judgment. We may add that, if for any of the reasons urged by them, which may possess some merit, the cause should be reversed, it is perfectly apparent from the views expressed by the learned trial judge that the asserted errors or irregularities would be corrected upon a new trial, and a judgment would be rendered again in favor of respondent.

However, we are satisfied that within the limits prescribed for the exercise of our jurisdiction, we cannot disturb the finding below.

The judgment is therefore affirmed.

Prewett, P. J., pro tern., and Hart, J., concurred.

All the Justices • concurred.