Casaretto v. DeLucchi

This action was brought by Louis T. Casaretto, doing business as the Redwood Meat Co., against J. D. and L. J. DeLucchi, partners, doing business as Mount Davidson Market, on a common count for goods allegedly sold by plaintiff to defendants. The goods sold consisted of meats which were allegedly sold and delivered during the period May, 1943, to November, 1943. According to plaintiff’s evidence he delivered $14,013.66 of meat during the period in question to defendants for which he received only $5,854.90, leaving a claimed balance of $8,158.76. The defendants in their answer denied all the material allegations of the complaint, and, in addition, by way of set-off and counterclaim, alleged that plaintiff had overcharged them some $7,000 on the deliveries made. The defendants also cross-complained not only against plaintiff but also against one Sehroeter, the former manager of the meat department of defendants. The first count of the cross-complaint alleged the existence of a conspiracy between Sehroeter and plaintiff by means of which the conspirators planned to deteriorate the value of defendants’ market so that it could be purchased by or sublet to them at much less than its real value; that pursuant to this conspiracy when Casaretto would deliver meat to defendants’ market, Sehroeter, as defendants’ manager would receipt for meat in excess of the amount delivered. It is alleged that this phase of the conspiracy resulted in a loss in operation of $6,493.50 and a loss of profits in the sum of $5,058.22, or a total damage of $11,551.72.

The second count of the cross-complaint alleged that during this same period the defendants and cross-complainants were registered with the O.P.A. as a retail meat market and had received from the O.P.A. an allotment of red points; that Casaretto, during this period, was illegally operating as a meat wholesaler; that pursuant to the conspiracy between these parties not only was less meat delivered than was called for by the tags, but Casaretto collected red points for such meat never delivered with the result that defendants overdrew their red point ration bank account; that as a result, defendants’ place of business was closed down by the O.P.A.

Demurrers to the answer and cross-complaint were overruled, whereupon the cross-defendants answered denying the allegations of the cross-complaint, and the cause proceeded to trial before a jury. The jury rendered two verdicts, one covering the issues raised by the complaint and answer, and the other covering the issues raised by the cross-complaint and the answer thereto. Both verdicts were in favor of the DeLucehis. On the complaint the jury found in favor of defendants. On the cross-complaint the jury also found in favor of the DeLucehis, and fixed the damages, assessed against both parties, at $6,500. Judgments were entered accordingly. Casaretto moved for a new trial in both proceedings, and Sehroeter joined with him in moving for a new trial on the issues involved in the cross-complaint. The trial court denied the motion insofar as the judgment in favor of the DeLucehis based on the issues raised by the complaint was concerned. On the motion relating to the issues raised by the cross-complaint and answer the court denied the motion on condition the cross-complainants consent to a reduction from $6,500 to $500. The cross-complainants refused to accept the reduction, so that this motion for a new trial was granted.

Plaintiff Casaretto has appealed from the judgment in favor of the defendants rendered on the issues raised by the complaint, while the DeLucehis have appealed from the order granting the new trial on the issues raised by the cross- complaint.

Appeal by CascvreMo

Most of the contentions raised by this appellant are highly technical and none are meritorious. No objection is made to any instruction given or refused by the trial court. A considerable number of technical objections are made to the pleadings. For example, the DeLucehis in their answer to the complaint set up a counterclaim. In this pleading it is averred that “Defendants incorporate Paragraphs I, II and III of cross-complainants’ cross-complaint filed in this action and make the same a part of this Answer as though herein set forth at this point word for word.” The cross-complaint was filed the same day as the answer. Casaretto urges that this is faulty pleading, and that Ms demurrer to the

A somewhat similar problem "was involved in Turney v. Collins, 48 Cal.App.2d 381 [ 119 P.2d 954 ]. In that ease the pleader in an amended answer and counterclaim, incorporated by reference certain exhibits pleaded in the original answer. In holding that this was not error the court stated (p. 388) : “As the question here presented to us is open, we are of the opinion that there is not the slightest reason for holding that a pleading may not by reference incorporate an exhibit or allegation found in another pleading in the same case, even though the pleading has been superseded by such later pleading. Except in a case where a complaint has been filed and not served, or a new party is brought into the case after pleadings have been filed and served, the opposing parties have copies of the prior pleadings, and so have no need to be supplied again, either with allegations or exhibits set forth in earlier pleadings in the same case. Such a requirement would simply involve needles additional expense to a party, and moreover, it unduly encumbers the record. ’ ’

There is no merit to this contention.

It is next urged that the allegations of the counterclaim do not show that the counterclaim is based on the same transaction which is the foundation of plaintiff’s complaint.

The next contention is equally technical, and is equally without merit. It is contended that the answer pleads “fraud” as a defense, and based on this contention it is urged that fraud was not properly pleaded and that such a defense converted the action into an equity action in which the jury’s verdicts were advisory only and in which plaintiff was entitled to findings of the court. The allegation complained of is found in Paragraph IV of the third defense set forth in the answer in which defendants allege that plaintiff delivered them meat but “overcharged” defendants some $7,000. It will be noted that no attempt to plead fraud is found in this allegation. An overcharge could be based on mistake as well as fraud. Moreover, no affirmative relief was awarded the DeLuechis on their counterclaim. It is not the counterclaim of the DeLuechis that charges fraud but their cross-complaint against both Casaretto and Schroeter. There can be no doubt at all that the cross-complaint alleges fraud in detail and with particularity. Casaretto strenuously argues

These contentions are all based on the basic misconception that in all cases where fraud is pleaded the cause of action is necessarily exclusively within the jurisdiction of the equity court. Fraud is, of course, a peculiar object of equity jurisdiction, but where, as here, the only relief asked is for damages, where no equitable relief or remedies are invoked, and where the remedy for damages is not only adequate but speedy, the action is at law, and equity will refuse jurisdiction. Equity jurisdiction is not conferred by a mere charge of fraud made affirmatively or defensively. (See many cases collected and commented upon 10 Cal.Jur. p. 475, § 17 ; 10 Cal.Jur. p. 467, § 10 ; 19 Am.Jur. p. 65, § 42 ; 30 C.J.S. p. 383, § 49.) Here the cross-complaint asked only monetary relief. No equitable remedy or right was invoked. This being so, the entire cause was legal in nature and it was proper, therefore, to submit all issues to the jury.

Casaretto also contends that certain evidence offered by the DeLucchis concerning their difficulties with the O.P.A. was admitted erroneously and to his prejudice. In his brief the only example of such testimony referred to is a series of questions asked Casaretto as to whether he had any conversations with the DeLucchis in which he was advised that the DeLucchis had been called before the O.P.A. because of a red point shortage. This evidence, and the other evidence relating to the red point shortage, was clearly within the issues raised by the cross-complaint. The questions, therefore, were not incompetent, irrelevant and immaterial, these being the objections made to them.

It is next contended that the verdict on the issues raised by the complaint and answer and counterclaim is in conflict with the pleadings and the stipulation of the parties. Casaretto points out that he sued the defendants for $8,805.19 and that the DeLucchis in their counterclaim alleged that

The contention that the DeLuechis stipulated during the trial that they had received all items of meat listed on the bill of particulars with the exception of an overcharge of $755.80 is without merit. A reading of the long record demonstrates that at all stages of the trial, both before and after the stipulation in question was entered into, the DeLuecMs were strenuously contending that much of the meat listed in the bill of particulars had never been delivered. The stipulation in question was never treated during the trial as an admission by the DeLuecMs that they had received the meat listed. All that the stipulation amounted to was to summarize the bill of particulars and to agree upon the poundage claimed by Casaretto. The exact words of the stipulation were that the “total poundage of beef we find from the bill of particulars delivered over the period of time or alleged to be delivered, ” etc. (R.T. 544.) And again, “ Total pounds of meat delivered, according to the bill of particulars,” etc. (R.T. 545.) Such a stipulation cannot be distorted into an admission that the DeLuechis had no defense at all to the cause of action pleaded in the complaint.

It is also urged that the verdicts and judgment are contrary to the evidence. It is very difficult to understand this contention. The evidence most favorable to the DeLuechis on both the issues raised by the complaint and cross-complaint shows the following facts: Casaretto’s place of business was Redwood City where he operated a retail meat market. He had no wholesaler's permit but Ms bill tags listed Mm as a wholesaler. The DeLuechis operated a large market in San Francisco, and in this market was a retail meat department. In November of 1942 Sehroeter was hired by the DeLuecMs as manager of their meat department. As such manager it was

Between the period May to November, 1943, Casaretto delivered large quantities of meat to the DeLuechis under this arrangement. Sehroeter, being the purchasing agent for the DeLuechis, gradually saw to it that practically all the meat for the DeLuechis’ market was purchased through Casaretto and the allotments with the various wholesalers were allowed to lapse.

When Casaretto delivered meat to the DeLuechis’ market he would always deliver the same to Sehroeter who would weigh the meat and sign a tag for it. Casaretto would give the original tag to Sehroeter and keep a copy for himself. Casa

The theory of the DeLucchis was that Schroeter would sign for a greater poundage of meat than was actually delivered. This had several results. It made the operation of the meat market unprofitable, so that, according to the DeLucchis, Casaretto and Schroeter could purchase the market from the DeLucchis for less than its true value. There is evidence that Casaretto tried to sublet the meat market at a very low monthly rental. Such practices also resulted in Casaretto receiving more red points than he was entitled to, thus depleting the DeLucchi stock of red points. Direct evidence was offered by the DeLucchis that as to at least two deliveries improper practices were indulged in by Casaretto. Thus evidence was offered relating to a delivery supposedly made on August 9, 1943. This load, contrary to the usual custom, was not delivered by Casaretto but was picked up in Redwood City by an employee of the DeLucchis, Scheppleman by name. Scheppleman testified that he signed for the meat in Redwood City and brought a signed copy of the receipt tag back with him to San Francisco; that this tag was made out for either 3,255 or 3,235 pounds of meat; that he arrived back at the DeLucchis’ market at about 6 p. m.; that Schroeter had left and that he and the DeLucchis weighed the meat and found a shortage; that the actual weight was 3,001 pounds. Both Scheppleman and Joe DeLucchi testified that a note was left for Schroeter to check this delivery and they left the duplicate tag with the note; that this was the last they ever saw of the Scheppleman tag. Casaretto offered in evidence a tag for this delivery which is signed by Schroeter and which states that 5,600 pounds of meat were delivered ón that date. Strangely enough, this Sehroeter tag is dated August 8th, which was a Sunday. As to this delivery, if the testimony offered by the DeLucchis was believed, as apparently it was, there was an overcharge of some 2,600 pounds. During the months here involved this was apparently the only delivery checked by the DeLucchis as to the weight claimed delivered, as this was otherwise left entirely in Schroeter’s hands.

There was also some peculiar circumstances surrounding an alleged delivery of meat on November 2, 1943. The tag offered by Casaretto to support this delivery was a duplicate

The DeLucchis offered some corrobative evidence that demonstrates that something was very wrong with the meat department from May to November, 1943. They showed that from January 1, 1943, to May 28, 1943, the meat market made a net profit of $2,340.62. This was before the dealings with Casaretto began. Prom May 29, 1943, to November 28, 1943, the meat market lost $6,597.39, although the amount of sales increased during this latter period. The records show that if Casaretto’s figures are correct, $90.68 more was actually charged during this period for meat than was taken in on sales. There was evidence that meat bought at wholesale ceiling and sold at retail ceiling would net the retailer between 30 to 33% per cent profit.

There were also some other facts testified to from which the jury could and apparently did indulge in inferences unfavorable to Casaretto. It was shown that, although Casaretto and Schroeter had known each other for fifteen years, it was not until after May of 1943 that they became intimate.

The books of Casaretto were in a somewhat questionable condition. At the trial a ledger sheet of the DeLucchi account was introduced. The entries thereon were not always in rotation by dates. Thus there would be an entry like May 6th following an entry of June 3d. Casaretto tried to explain this anomalous situation but the sufficiency of his explanation was for the jury. Moreover, both Joe DeLucchi and his bookkeeper testified that while investigating the red point shortage they checked Casaretto’s accounts and were told that no ledger sheet of their account was kept.

The evidence also shows that on November 2, 1943, the O.P.A. forbade the DeLucchis from purchasing any more red point items because of a huge red point shortage of about 88,000 points. Subsequently, the meat market was suspended for a year. Obviously, if Casaretto overcharged the De-Lucchis as to poundage and received red points based on the overcharges, it would deplete the DeLucchi supply of red points.

It is quite clear that the above evidence, plus the reasonable inferences therefrom, sustains the finding of the jury that Casaretto did not sustain the burden of proof of showing what meat had in fact been delivered. The judgment based on the verdict is amply supported and should be affirmed.

Appeal by the DeLucchis from the order granting a new trial to Casaretto and Sehroeter on the judgment for $6,500 based on the issues raised by the cross-complaint.

Casaretto and Sehroeter contend that the order is not appealable because, so they claim, the action was equitable in nature, and jury trial was therefore not a matter of right.

The motion for a new trial on the judgment based on the issues raised by the cross-complaint was made on the ground of excessive damages, insufficiency of evidence and errors in law occurring at the trial. The trial court, it will be remembered, granted this motion for a new trial unless the DeLucchis agreed to a reduction in damages from $6,500 to $500. The trial judge did not specify insufficiency of the evidence "as a basis of his order, so that that ground must be disregarded. (Code Civ. Proc., § 657.) No ground at all was specified as the basis of the order. It is obvious, however, that the basis of the order granting the new trial must have been excessive damages in view of the provision of the order that if the DeLucchis would accept a reduction to $500 the motion would be denied. However, the trial court’s power in this respect is much more limited than it is when the order is based on insufficiency. Section 657, subdivision 5, of the Code of Civil Procedure, provides that a new trial may be granted on the ground of “excessive damages, appearing to have been given under the influence of passion or prejudice.” A new trial may not be granted on this ground merely because the verdict seems large, but only when it appears to have been given under the influence of passion or prejudice. The trial court may interfere with the verdict on this ground only where the verdict is so disproportionate to any reasonable limit of compensation warranted by the facts as to shock the sense of justice. Thus if the evidence before the trial court is conflicting, and there is substantial evidence to sustain the award, no right to grant a new trial on the ground of ex-cessiveness of the verdict exists where insufficiency of the evidence is not also specified as a ground of the order. These principles are all well settled. (See eases collected 20 Cal.Jur. p. 99, et seq., § 64, et seq.)

Tested by these standards the evidence produced by the DeLucchis amply supports the award of $6,500. As al

In addition, as a result of the loss of red points the De-Lucchis were first forbidden by O.P.A. to purchase red point items, and then their meat department was completely suspended for a year. Thus, they were deprived of prospective profits in excess of the amount of the award.

Casaretto and Schroeter strenuously argue that they cannot be held responsible for the red point shortage because red point items were sold by the grocery department of De-Lucchis’ as well as the meat department, and but one red point bank account was maintained for both departments. The son of Schroeter who worked for the DeLucchis in the grocery department testified that he delivered many red point items to customers on DeLucchis’ orders without securing red points. He named the customers he claimed who had been so favored. Practically every customer named was called as a witness and categorically denied the statements of young Schroeter. The other evidence on this point has already been reviewed. Obviously, if Casaretto overcharged on poundage he depleted the red point bank. The jury was entitled to infer that the deficiency in red points was caused by Casaretto and Schroeter.

It is obvious, therefore, that there is ample, substantial and credible evidence in the record to sustain a much more substantial award than the $6,500 fixed in the verdict. It is equally clear that under such circumstances the trial court was without power to grant a new trial on the ground of excessiveness of the damages.

It will be noted that the notice of motion for a new trial also specified errors of law. Under the rule announced in Scott v. Renz, 67 Cal.App.2d 428 [ 154 P.2d 738 ], it is necessary to search the record and to demonstrate that no error of

The respondents Casaretto and Schroeter claim that the cross-complaint does not state a cause of action, and that their demurrer and supplementary demurrer thereto should have been sustained. It is urged that the allegations of the cross-complaint fail to show that the relief sought relates or depends upon the transaction upon which the main action was brought as required by section 442 of the Code of Civil Procedure. The point lacks merit. The Casaretto action was for the price of meat alleged to have been delivered. The cross-complaint charges Casaretto and Schroeter with a conspiracy to defraud on the weight of the beef delivered. Obviously, the cross-complaint relates to the same transaction set forth in the compaint.

It is also contended that Schroeter was never properly made a party to the action. Schroeter was brought into the proceeding by the cross-complaint. The order making him a party was secured by DeLucchis’ counsel ex parte without notice to Casaretto. It is urged that this rendered invalid the proceedings based on the cross-complaint. It is of course the law that a new party cannot be brought into the proceedings by a defendant without an order of court. (Alpers v. Bliss, 145 Cal. 565 [ 79 P. 171 ].) That same case decided that if such an order is secured ex parte it may be vacated upon proceedings had under section 937 of the Code of Civil Procedure. The law is well settled that section 937 is applicable only to such orders as a court or judge has power or jurisdiction to make without notice. (See cases collected 18 Cal.Jur. p. 672, § 23.) Thus the holding of the Alpers case is necessarily predicated upon the assumption that the court has jurisdiction to bring in a new party by an ex parte order. No proceedings under section 937 of the Code of Civil Procedure were here instituted.

The contention that Schroeter was not a party whose presence was necessary to a complete determination of the controversy as required by section 389 of the Code of Civil Procedure is so clearly without merit that the mere statement

Casaretto and Schroeter also claim error in the action of the trial court in granting the DeLueehis’ motion to strike their demand for a bill of particulars. The cross-complaint was not based upon an account, but was an action for damages for a conspiracy. No claim based on contract was invoked and no specific demands were made against Casaretto and Schroeter. Under such circumstances no bill of particulars was necessary within the meaning of section 454 of the Code of Civil Procedure. (See cases collected 1 Cal.Jur. p. 157, § 18.)

There was no possible error of law that has been suggested by Casaretto or Schroeter or that we have found that supports the order granting the new trial.

The judgment in favor of the DeLueehis based on the issues raised by the complaint and answer is affirmed; the order granting a new trial on the issues raised by the cross-complaint is reversed.

Ward, J., and Schottky, J. pro tem., concurred.