American Enterprise, Inc. v. Van Winkle

• Decision Date: 08 July 1952
• Citation: 246 P.2d 935,39 Cal.2d 210
• Court: California Supreme Court
• Parties: AMERICAN ENTERPRISE, Inc. v. VAN WINKLE et al. S. F. 18261.

Page 935

246 P.2d 935

39 Cal.2d 210

AMERICAN ENTERPRISE, Inc. v. VAN WINKLE et al.

S. F. 18261.

Supreme Court of California, in Bank.

July 8, 1952.

Donahue, Richards, Rowell & Gallagher and George E. Thomas, Oakland, for appellant.

Mancuso, Herron & Winn, and John Wayne Herron, San Francisco, for respondents.

EDMONDS, Justice.

American Enterprise, Inc., brought an action in declaratory relief to determine its rights, and also those of Walter S. Van Winkle, under a lease. By certain provisions of the lease, in the event the property was taken for public use by a proceeding in eminent domain, the lessor might terminate the tenancy and take possession of the premises. Under such circumstances, the lessor was given the right to purchase for $10 certain fixtures and equipment. The judgment declares that the lease has been terminated but that Van Winkle, the lessee, is the owner of and entitled to possession of the fixtures and equipment. The appeal of American Enterprise is from that portion of the judgment which concerns the rights of the parties to the personal property.

There is no conflict in the evidence. In 1939, American Enterprise leased to M. J. Russell real property for use as a bowling alley. The term of the tenancy was about 11 years. With the written consent of the lessor, Russell assigned his interest to Van Winkle.

The lease required the lessee to purchase, under a conditional sale contract, equipment for the operation of the bowling alley. He agreed to give the lessor a chattel mortgage on this equipment as security for the payment of rent. If the lease were terminated prior to its expiration, provided he were not in default, he might remove all trade Fixtures. Also, under such circumstances, the lessor promised to pay to the lessee $750 and to release the chattel mortgage.

The lease made elaborate provision for disposing of the parties' interest in the leasehold in case the demised premises were taken for public use by right of eminent domain. If there were an 'actual taking, under eminent domain proceedings, of the whole * * * of the property of which the demised premises are a part', the lessee covenanted to deliver possession of the premises to the lessor or its successor within 30 days after receipt of written notice. The lessee, in return, was to receive a sum equal to $3,000 per year for each unexpired year of the term of the lease. In such event, the lessee further convenanted to sell to the lessor for $10 all of the bowling alley equipment and furnishings installed in or upon the premises.

In 1946, American Enterprise, by grant deed, conveyed the property to Sam Neider, its president. In the following year, the City of Oakland authorized condemnation of the property and threatened to commence an action for that purpose. By reason of such threat, but without an action having been instituted, Neider conveyed the property to the city.

One month later, American Enterprise served upon Van Winkle a notice to surrender possession. It notified him that the entire property had been taken an eminent domain proceeding, demanded delivery of possession of the premises to American Enterprise and the execution of a bill of sale of the personal property.

The present action was commenced by American Enterprise more than two and one-half years after its deed to Neider. The complaint alleged that the City of Oakland had acquired the property by right of eminent domain, that American Enterprise had terminated the lease in accordance with the conditions contained therein, and that Van Winkle, wilfully and wrongfully refused to abide by the terms of the notice.

In his answer, Van Winkle denied that the property had been taken in an eminent domain proceeding. As an affirmative defense, he alleged that American Enterprise 'has divested itself voluntarily of all right, title and interest in said Lease and the terms, conditions and covenants thereof, and that said complaint does not state facts sufficient to constitute a cause of action against Defendant.'

Upon trial, the court made findings of fact in accordance with the foregoing evidence. As conclusions of law, it determined that the sale of the property to the city, made under threat of condemnation, was within the contemplation of the parties in giving the lessor the right to terminate th lease. Other conclusions were that the notice served upon Van Winkle effectually terminated his tenancy and that he 'is the owner of and entitled to the possession of' the personal property and equipment in the premises.

The judgment subsequently entered declares that Van Winkle's tenancy was terminated by the notice of American Enterprise and since that date it has been entitled to the possession of the premises. Another provision states that 'Walter S. Van Winkle is the owner of and entitled to the possession of the Bowling alley equipment, furniture and fixtures, and all of the personal property in and about said premises.'

The appeal of American Enterprise is from only that portion of the judgment declaring Van Winkle to be entitled to possession of the personal property and equipment. Van Winkle did not appeal.

The determination that Van Winkle 'is the owner of and entitled to the possession' of the personal property is challenged by the lessor as failing to adjudicate the rights of the parties under the sale provision of the lease. For the purposes of argument, the appellant reads the judgment as holding that Van Winkle is not required to sell the equipment to it. This, it contends, is erroneous. The lease provision, it is said, constitutes an enforceable contract to sell and, in no sense, is a provision for forfeiture.

Van Winkle takes the position that the judgment correctly denies American Enterprise the right to purchase the personal property. To support this conclusion, he asserts that the appellant is without standing to prosecute this action because it conveyed all of its interest in the real property. His second point is that a sale of the real property under threat of condemnation does not amount to a taking of it in an eminent domain proceeding within the contemplation of the lease. Finally, he argues that, because the current market value of the fixtures and equipment is nearly $40,000, to require him to sell them for $10 would be to compel a forfeiture.

In reply, American Enterprise argues that its right to maintain this action as the lessor, and the question as to whether or not there has been a taking of the real property by a proceeding in eminent domain, are issues necessarily determined in that part of the judgment declaring its right to possession of the demised premises. Because Van Winkle has taken no appeal it says, the adjudication of those issues has become final.

If the contention is correct, those issues may not be considered by the reviewing court. The basic question, therefore, is the scope of review upon a partial appeal. The answer lies in a determination as to whether that portion specified in the notice of appeal is severable from the remainder of it. The well recognized rule is that there may be an appeal from a part of a judgment only if that part is severable. Bancroft, Code Practice and Remedies, 8326, § 6267; State ex rel. Mueller v. Todd, 117 Mont. 80, 158 P.2d 299, 300; Evans v. De Spain, Tex.Civ.App., 37 S.W.2d 231, 233; Cottier v. Sullivan, 47 Wyo. 72, 31 P.2d 675, 678; Stearns v. Strom, 68 Idaho 392, 195 P.2d 337; 4 C.J.S., Appeal and Error, § 109, p. 204. Where portions of a judgment are truly severable, the appellate court is without jurisdiction to consider the parts from which no appeal has been taken. In re Burdick, 112 Cal. 387, 391, 44 P. 734; G. Ganahl Lumber Co. v. Weinsveig, 168 Cal. 664, 667, 143 P. 1025. And the appellate court will consider the portion before it independently of the other parts. Pacific Mutual Life Ins. Co. v. Fisher, 106 Cal. 224, 231, 39 P. 758; In re Yoder, 199 Cal. 699, 704, 251 P. 205; Denman v. Smith, 14 Cal.2d 752, 755, 97 P.2d 451; Arp v. Blake and Cohn, 63 Cal.App. 362, 370, 218 P. 773; Swall v. Anderson, 60 Cal.App.2d 825, 827, 414 P.2d 912. Modification or reversal of the portion of the judgment from which the appeal has been taken has no effect upon the other portions. Pacific Mutual Life Ins. Co. v. Fisher, supra, 106 Cal. at page 232, 39 P. 758; Lake v. Superior Court, 187 Cal. 116, 119, 200 P. 1041; Smith v. Anglo-California Trust Co., 205 Cal. 496, 505, 271 P. 898; Neill v. Five C. Refining Co., 79 Cal.App.2d 191, 194, 179 P.2d 818.

The test of whether a portion of a judgment appealed from is so interwoven with its other provisions as to preclude an independent examination of the part challenged by the appellant is whether the matters or issues embraced therein are the same as, or inter-dependent upon, the matters or issues which have not been attacked. Blache v. Blache, 37 Cal.2d 531, 538, 233 P.2d 547; Cottier v. Sullivan, supra, 31 P.2d at page 678; Warren Mercantile Co. v. Myers, 48 Wyo. 232, 45 P.2d 5, 6; Stout v. Oliviera, Tex.Civ.App., 153 S.W.2d 590, 594. '(I)n order to be severable, and therefore appealable, any determination of the issues so settled by the judgment * * * must not affect the determination of the remaining issues whether such judgment on appeal is reversed or affirmed * * *. Perhaps another way of saying it would be that the judgment is severable when the original determination of those issues by the trial court and reflected in the judgment or any determination which could be made as the result of an appeal cannot affect the determination of the remaining issues of the suit * * *.' Attorney General v. Pomeroy, 93 Utah 426, 73 P.2d 1277, 1294, 114 A.L.R. 726.

Measured by this rule, the portions of the judgment in the present case which declare the rights of the parties to the realty and to the personalty are inseparable upon the issue as to whether there was a taking of the property in an eminent domain proceeding and the...