Hamberger-Polhemus Co. v. Hind, Rolph & Co.

Plaintiff sued upon a complaint pleading two causes of action “for breach of contract,” one in the form of a common count for money had and received and the other based upon five written contracts for the purchase and sale of sugar. The defendants’ demurrer to the complaint was sustained without leave to amend and the plaintiff has appealed upon the judgment-roll.

[1] The first alleged cause of action pleads that the defendant is indebted to the plaintiff in the sum of $613.25 for money had and received by said defendant for the use of plaintiff. This pleading of an indebtedness under the old form known as a common count is sufficient against demurrer under the rule of Pike v. Zadig, 171 Cal. 273 , 276 [ 152 Pac. 923 ], and cases there cited. [2] The general demurrer should, therefore, have been overruled upon the authority of that case and the special demurrer, inasmuch as it merely raised the point of uncertainty as to how the indebtedness arose, should likewise have been overruled upon the same authority (p. 277), the remedy of the defendant being to demand a bill of particulars.

In support of the judgment the respondent urges that the appellant has mistaken its remedy and should have sued for the difference between the contract price and the market price of the sugar as provided in sections 3308 and 3354 of the Civil Code; that the complaint is insuffi

[3] The complaint is designated as one for breach of contract. So far as the allegations of the second cause of action are concerned the only breach alleged refers to contracts “D” and “E,” wherein the respondent was obligated to deliver sugar to the appellant upon payment of the purchase price thereof. It is alleged that contracts “A,” “B,” and “C” were executed prior to the date of execution of contracts “D” and “E,” but it does not appear appellant at that time or at any time prior to the commencement of the action. It is alleged that demand was made upon the respondent to deliver the sugar called for by contracts “D” and “E,” but it does not appear that the appellant at that time or at any time prior to the commencement of the action tendered payment as required by those contracts. But, on the other hand, from the allegation that at the time of the demand the appellant informed respondent that it sought delivery merely for the purpose of fulfilling its obligation to deliver under contracts “A,” “B,” and “C,” it may be assumed that no tender of payment was made. Certainly, in an action for breach of contracts “D” and “E,” which is all that the complaint pretends to cover, the measure of damages must be that fixed by sections 3308 and 3354 of the Civil Code. So far as anything appears from the pleading the market price of sugar at the place of delivery may have been less than that which the appellant was called upon to pay under the contracts which it claims to have been breached. [4] Manifestly, where special damages only are sought, though the measure of damages is statutory, it is necessary to plead the facts which would show that the pleader had sustained damages of the character for which the remedy is provided. In Judson Mfg. Co. v. Lutge, 174 Cal. 566 [ 163 Pac. 1017 ], the supreme court had before it a pleading seeking damages for delay in delivery under a contract for the sale of material. It was pleaded “that by reason of plaintiff’s said breaches of its said contract with this defendant, this defendant has been damaged in the sum of $4,000.” The court said: “The damage for which recovery is here sought is, under every rule of pleading and

The demurrer to the second cause of action was properly sustained, and though the complaint might have been amended to meet the objections raised by the demurrer it does not appear that leave to amend was asked or refused.

Though we have said that the demurrer to the first cause of action should have been overruled, we find that on this appeal the appellant has frankly stated that this cause of action is predicated upon the transactions set forth in the second cause of action and that if there is no recovery to be had in the second cause of action then there could be no recovery on the first. It is frankly conceded that the entire transaction was a “wash sale,” as that term is Used in the trade, a transaction whereby the parties agree to settle by one of them paying the other the difference between the contract price and the market price at the time of delivery. Such a transaction has been declared to be merely a speculation upon the rise and fall of the market and as such contrary to public policy and void, at least where the transaction is made with the intention to speculate on the market and not to deliver the commodities contracted for. Though in reviewing the allegations of the complaint the intention of the parties to thus speculate upon the rise and fall of the sugar market is not clear, the defendant in his brief contends that such was the character of the transaction and that this was within the knowledge of the parties from the beginning. If the cause

Judgment affirmed.

Sturtevant, J., and Koford, P. J., concurred.