Dairyman's Cooperative Creamery Assn. v. Leipold

• Decision Date: 05 September 1973
• Citation: 34 Cal.App.3d 184,109 Cal.Rptr. 753
• Parties: , 13 UCC Rep.Serv. 237 DAIRYMAN'S COOPERATIVE CREAMERY ASSOCIATION, Plaintiff and Respondent, v. Jerry LEIPOLD, Defendant and Appellant. Civ. 1776.
• Court: California Court of Appeals Court of Appeals

Page 753

109 Cal.Rptr. 753

34 Cal.App.3d 184, 13 UCC Rep.Serv. 237

DAIRYMAN'S COOPERATIVE CREAMERY ASSOCIATION, Plaintiff and Respondent, v. Jerry LEIPOLD, Defendant and Appellant.

Civ. 1776.

Court of Appeal, Fifth District, California.

Sept. 5, 1973.

Hearing Denied Oct. 31, 1973.

C. Richard Maddox, Beverly Hills, for defendant and appellant.

Joseph L. Soares, Brian M. Rowson, William Silveira, Jr., Tulare, for plaintiff and respondent.

OPINION

GARGANO, Associate Justice.

The Dairyman's Cooperative Creamery Association, hereafter called the Co-op, brought this action, in common count, to recover the sum of $10,912.50 from appellant, Jerry Leipold; the common count was allegedly predicated on appellant's oral agreement to purchase 450 bags of dry milk powder from the Co-op.

In defending the action in the court below, appellant, who is a broker, did not deny that he ordered the milk powder from the Co-op. He took the position that he was not obligated to pay for the powder because he had dealt with the Co-op as a broker, not as a principal. He also took the position that the oral agreement was unenforceable under the Statute of Frauds. This statute is set forth in section 2201 of the California Commercial Code and reads in pertinent part as follows:

'(1) Except as otherwise provided in this section a contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement is sought or by his authorized agent or broker. A writing is not insufficient because it omits or incorrectly states a term agreed upon but the contract is not enforceable under this paragraph beyond the quantity of goods shown in such writing.

'(2) Between merchants if within a reasonable time a writing in confirmation of the contract and sufficient against the sender is received and the party receiving it has reason to know its contents, it satisfies the requirements of subdivision (1) against such party unless written notice of objection to its contents is given within 10 days after it is received.

'(3) A contract which does not satisfy the requirements of subdivision (1) but which is valid in other respects is enforceable.

'. . .con

'(c) With respect to goods for which payment has been made and accepted or which have been received and accepted.'

After court trial, the trial judge gave notice of his intended decision as required by Rule 232, subdivision (a), of the California Rules of Court. When neither side requested findings of fact and conclusions of law, the court entered judgment in favor of the Co-op for the sum of $10,912.50 plus interest as prayed for in the complaint. Appellant has appealed, challenging the sufficiency of the evidence to support the judgment. His attack centers on the court's notice of intended decision which reads as follows:

'. . . Although there was a conflict in the evidence, the best evidence indicates that plaintiff contracted the sale with the defendant as a principal and not as an agent. This is corroborated by both the shipping order (plaintiff's exhibit No. 1) and the invoice (plaintiff's exhibit No. 2). The contract of sale is excluded from the Statute of Frauds under section 2201, subdivision 2, since the parties were contracting as merchants, and the invoice was sent directly to defendant, which was a confirmation of the terms and conditions of the sale, and the defendant failed to make written objection to its contents within ten days as required.'

There was ample evidence for the trial judge to find that appellant orally contracted to buy the 450 bags of dry milk powder from the Co-op as a principal and that he personally agreed to pay the purchase price.

Gary Gilman, a Co-op sales representative in the Los Angeles area, testified that in early August 1968 he received a telephone call from appellant, a broker, who requested prices on 'dry milk powder.' The witness said in a subsequent call they discussed a brokerage allowance and that appellant asked if the client could be billed directly. Gilman informed appellant that all sales were made directly to brokers and that the general manager was the only person who could authorize a change in the Co-op's policy.

George M. DeMedeiros, the Co-op's general manager, testified that appellant telephoned him in August; appellant stated that he was a broker and inquired as to the conditions upon which the Co-op would sell a broker milk powder. DeMedeiros told appellant that the Co-op sold through brokers and that the brokerage was 'a quarter of a cent'; he said he explained to appellant that the Co-op did not wish to become involved with the broker's customers and that it was its policy to bill the broker and hold him responsible for the account. Appellant then ordered 450 bags of powdered milk and directed that delivery be made to West Pac at 6860 Oran Circle, Buena Park, California.

There is merit, however, to appellant's contention that there was no substantial evidence to support the trial court's implied finding that the oral agreement fell within the exception of subdivision (2) of section 2201 of the Commercial Code. Although the copy of the shipping order shows that the milk powder was billed to Jerry Leipold, and although the copy of the invoice which followed the shipping order...