Adams Mfg. & Engineering Co. v. Coast Centerless Grinding Co.

• Decision Date: 16 September 1960
• Docket Number: 24801,Nos. 24767,s. 24767
• Citation: 184 Cal.App.2d 649,7 Cal.Rptr. 761
• Court: California Court of Appeals Court of Appeals
• Parties: , 127 U.S.P.Q. 174 ADAMS MANUFACTURING AND ENGINEERING COMPANY, Plaintiff and Appellant, v. COAST CENTERLESS GRINDING COMPANY, a corporation, and Robert H. Black, Defendants. Coast Centerless Grinding Company, a corporation, Respondent. ADAMS MANUFACTURING AND ENGINEERING COMPANY, Plaintiff and Respondent, v. COAST CENTERLESS GRINDING COMPANY, a corporation, and Robert H. Black, Defendants. Robert H. Black, Appellant.

Page 761

7 Cal.Rptr. 761

184 Cal.App.2d 649, 127 U.S.P.Q. 174

ADAMS MANUFACTURING AND ENGINEERING COMPANY, Plaintiff and Appellant, v. COAST CENTERLESS GRINDING COMPANY, a corporation, and Robert H. Black, Defendants.

Coast Centerless Grinding Company, a corporation, Respondent.

ADAMS MANUFACTURING AND ENGINEERING COMPANY, Plaintiff and Respondent, v. COAST CENTERLESS GRINDING COMPANY, a corporation, and Robert H. Black, Defendants.

Robert H. Black, Appellant.

Nos. 24767, 24801.

District Court of Appeal, Second District, Division 2, California.

Sept. 16, 1960.

Rehearing Denied Oct. 13, 1960.

Hearing Denied Nov. 10, 1960.

Clement H. Jacomini, Los Angeles, for appellant Robert H. Black.

Larwill & Wolfe, Los Angeles, for appellant and respondent Adams Mfg. and Engineering Co.

Wm. J. Cusack, Los Angeles, for respondent Coast Centerless Grinding co.

ASHBURN, Justice.

Before us are two appeals arising from the judgment in Adams Manufacturing and Engineering Company vs. Coast Centerless Grinding Company, a corporation, and Robert H. Black, Superior Court No. 716854. Plaintiff sued to recover the value of services rendered and materials furnished to respondents Coast Centerless Grinding Company (hereinafter designated as Coast) and Robert H. Black, in the construction of two oil well pumps. The complaint is in two counts, the first of which is directed at defendant Coast alone and the second against Coast and its co-defendant Black. The court rendered judgment in favor of defendant Coast, but also rendered judgment by default against Black in the sum of $6,542.10, plus interest and costs. From the judgment in favor of Coast plaintiff appeals (2nd Civil No. 24767), and from the judgment against Black he appeals (2nd Civil No. 24801).

The first count of the complaint alleges that Coast became indebted to plaintiff within two years past in the sum of $6,542.10 for materials furnished and labor performed in the fabrication of two oil well pumping machines; that the work was done and materials furnished at the request of defendant Coast, payment demanded of said defendant and no part paid. Defendant Black is not mentioned in that cause of action. The second count incorporates by reference the allegations of the first cause of action and adds: 'Plaintiff is informed and believes and therefore states the fact to be that at all times herein mentioned defendants Coast Centerless Grinding Company, a corporation and Robert H. Black were partners engaged in the production of the aforesaid two oil well pumping machines and for which machines plaintiff furnished said labor and materials, as aforesaid.' Judgment for $6,542.10 plus interest and costs is prayed against both defendants. On September 25, 1959, the clerk entered Black's default. Coast answered denying all material allegations of the complaint and the cause came on for trial on January 28, 1960, without a jury. No judgment had been rendered against Black at that time.

The pre-trial order incorporates a stipulation of counsel which says: 'The only apparent issue is the liability of the defendant Coast Centerless Grinding Company for the labor and materials furnished by plaintiff on said oil well pumping machines. In the determination of this issue it will be necessary for the Court to determine the relationship of the two defendants and to determine whether or not there was a joint venture (a co-partnership) between them which will make the defendant Coast Centerless Grinding Company liable for the money due to plaintiff.' Plaintiff-appellant's briefs say: 'The question involved in this appeal is: 'Did a joint venture exist between the two defendants in the action, one defendant being the respondent here, Coast Centerless Grinding Company, and one Robert H. Black. If a joint venture did exist, as appellant contends, then the respondent (as a joint-venturer with the other defendant) is as fully liable to this appellant as the trial court found the said co-defendant to be'; 'Respondent, in its Statement of the Case, says: '* * * that the question of the existence of a joint venture is one of the question involved in this appeal.' Appellant contends it is the only question involved. Throughout the entire action respondent repeatedly stated that as far as it was concerned, joint venture was the only issue. Respondent stipulated with appellant in their joint pre-trial statement that this was the only issue, and in the Pre-Trial Conference Order this was said to be the issue.'

As a result of the trial the court found that defendant Coast had not become indebted to plaintiff in any sum for or on account of materials and labor furnished or performed in the fabrication of two oil well pumping machines or otherwise, and that it is not true that defendant Coast requested that any of said work be done by plaintiff or that any of said materials be furnished by plaintiff. Also: 'The court finds that it is not true that defendants Coast Centerless Grinding Company, a corporation, and Robert H. Black were partners or joint venturers engaged in the production of the oil well equipment described in plaintiff's complaint as two oil well pumping machines.' Judgment was rendered as above indicated.

Appeal of Coast--No. 24767

Plaintiff, as appellant, argues that the defendants were partners or joint venturers and that Coast was therefore liable to plaintiff because of the activities of Black and his implied agency for his co-adventurer. The argument rests upon a written agreement between the defendants, supplemented by oral evidence concerning their respective acts in development of Back's invention relating to oil well pumps and the patent rights coverning same. Appellant's opening brief says: 'Appellant (plaintiff below) was in the manufacturing business. Defendant Robert H. Black requested plaintiff to furnish labor, and some of the materials, to construct two of said oil well pumps, between 2 September and 29 October, 1957. (Admitted by Pre-Trial Statement and Pre-Trial Conference Order.)' The agreement recites Black's ownership of the invention and covering patent rights also the previous payment by Coast (designated as assignee) of $5,000 to Black (assignor) 'for use in the development and construction of two units of said invention.' The parties agree that said $5,000 has been so used in he development of the invention and the construction of two units of same; 'and the assignee agrees to advance the total sum of Six Thousand Dollars ($6000.00) if such an amount is required to complete the two units referred to and install one of such units in a working well. Should the cost of the first two units including the cost of installing one of them in a working well exceed the sum of Six Thousand Dollars ($6000.00), the assignor will pay such additional cost.' Black assigns to Coast 'an undivided 50 percent (50%) of said entire and exclusive right, title and interest' in the invention and patent rights thereon. In paragraph IV the assignee agrees to pay to assignor for the rights so transferred and assigned the sum of $24,000, $5,000 being acknowledged as previously paid and the balance to be payable in nine installments of $2,000 each 'commencing on the 1st day of the month after to two units now under construction are completed and sold and have proven meritorious to the extent that additional orders have been received by assignee * * *. The assignee may discontinue the payment of said monthly installments at any time that it may determine that the device covered by this agreement will not prove satisfactory to the trade, and may withhold the payment of such installments until the merits of said device are established.' Paragraph V says that 'in the event the marketing of said device should prove to be unprofitable to the assignee, the assignee may elect to reassign to assignor all of the rights transferred to it pursuant to this agreement, and in such event, and upon tender of a reassignment of such rights, the assignee [sic] agrees within thirty days (30) thereafter to repay, or cause to be repaid to assignee, all sums theretofore paid or advanced by assignee pursuant to the provisions of this agreement including the sum of Six Thousand Dollars ($6000.00) advanced by assignee and used in the development and construction of the first two units.' Assignee is given the first right to purchase the other 50...