Dumm v. Pacific Valves

• Decision Date: 14 December 1956
• Court: California Court of Appeals Court of Appeals
• Parties: Carol Ann DUMM and Mary Jane Dumm, Minors, by their legal guardian, Marion M. Collins, Plaintiffs and Appellants, v. PACIFIC VALVES, a corporation, Charlotte M. Dumm, Howard C. Dumm, Helen I. Dumm, Irving M. Dumm, Elizabeth M. Dumm, Robert J. Dumm, Grace Dumm, and Irving M. Dumm III, Defendants and Respondents. Civ. 21854.

Page 738

304 P.2d 738

146 Cal.App.2d 792

Carol Ann DUMM and Mary Jane Dumm, Minors, by their legal guardian, Marion M. Collins, Plaintiffs and Appellants, v. PACIFIC VALVES, a corporation, Charlotte M. Dumm, Howard C. Dumm, Helen I. Dumm, Irving M. Dumm, Elizabeth M. Dumm, Robert J. Dumm, Grace Dumm, and Irving M. Dumm III, Defendants and Respondents.

Civ. 21854.

District Court of Appeal, Second District, Division 1, California.

Dec. 14, 1956.

Rehearing Denied Jan. 2, 1957.

Hearing Denied Feb. 6, 1957.

James C. Webb, Long Beach, for appellants.

Albert D. White, Walter Desmond, Jr., Long Beach, for respondents.

WHITE, Presiding Justice.

Plaintiffs appeal from a judgment and attempt to appeal from an 'order hereinbefore made on or about the 10th day of October, 1955, sustaining the defendants' demurrer to plaintiffs' Third Amended Complaint herein'.

An order sustaining a demurrer is not appealable. Code Civ.Proc. § 963; Jeffers v. Screen Extras Guild, Inc., 107 Cal.App.2d 253, 254, 237 P.2d 51. It is deemed excepted to, Code Civ.Proc. § 647, and will be reviewed upon appeal from the judgment. The minute order of October 10, 1955, is that the demurrer of all of the named defendants to the Third Amended Complaint 'is sustained, with ten days allowed plaintiff in which to amend'.

The demurrer specifies the following grounds: (1) 'said Third Amended Complaint does not state facts sufficient to constitute a cause of action for declaratory relief against these defendants, or any of them'; (2) 'the court is without judisdiction of the subject of this action, in that it appears on the face of the Third Amended Complaint that plaintiffs have failed to comply with the requirements of Section 834 of the Corporations Code * * *'; (3) 'the plaintiffs, as mere beneficiaries of a trust consisting of a minority of corporate shares, are without capacity or right to commence or maintain the said action against the directors of the corporation'; (4) said complaint is uncertain for eight reasons, to wit: (a) it cannot be ascertained therefrom how defendants Charlotte M. Dumm, Helen I. Dumm, Elizabeth M. Dumm and Grace Dumm are concerned; (b) it cannot be ascertained how the defendants took, appropriated, and distributed the money among themselves and converted it to their own use; (c) that there are no sufficient and specific allegations of fact constituting the elements of fraud; (d) that the identify of the testamentary trustees has been deleted; (e) that the terms of the trusts or the duties of the trustees cannot be ascertained from the complaint; (f) that it cannot be ascertained how or in what manner the 180 shares 'belong to' the minors; (g) that the complaint does not show 'upon what supporting facts' it is alleged there is an 'existing controversy'; and (h) that the complaint fails to allege the lack of a plain, speedy and adequate remedy at law; (5) 'several causes of action have been improperly united or not separately stated, to-wit, an alleged matter of probate and a testamentary trust, purely and exclusively under the jurisdiction of the Probate Court, to wit, the testamentary trust referred to in paragraph IX of the plaintiffs' Third Amended Complaint, to wit, In the Matter of the Estate of John F. Dumm, also known as Jack F. Dumm, deceased, No. LB P-22262, united with a derivative suit by alleged minority shareholders of a corporation, and against its directors thereof'; (6) the complaint is ambiguous for the same reasons it is uncertain; and (7) it is unintelligible for the same reasons it is ambiguous and uncertain.

The order sustaining the demurrer gives ten days to amend the Third Amended Complaint. Plaintiffs failed to amend. Defendants served upon them notice of the ruling on the demurrer, and about 40 days later moved for dismissal pursuant to Section 581, subd. 3 of the Code of Civil Procedure. The motion was granted and judgment was entered that plaintiffs take nothing, the action be dismissed, and defendants have their costs.

Appellants contend that the court was without jurisdiction to grant the judgment in the instant action 'without notice to appellants, and said judgment is void upon its face'. No cases are cited by them in support of that contention. By plaintiffs' failure to amend, in effect they refuse to amend, perhaps because they prefer to stand upon the complaint as it is, or perhaps because they have pleaded every fact they are prepared to prove in support of their action. Their failure to amend leaves nothing to be done by the court except the making and entry of the judgment. The requirement that the judgment be made 'when * * * the defendant moves for such dismissal', Code Civ.Proc. § 581, subd. 3, relieves the court of the duty to dismiss the action upon its onw motion, but does not require that notice of the motion be given to plaintiffs.

In the instant action the order sustaining the demurrer to the Third Amended Complaint does not specify the ground or grounds upon which the ruling is based. Therefore, if the complaint is insufficient on any ground properly specified in the demurrer, the judgment entered after the order sustaining the demurrer will not be reversed on appeal. Moxley v. Title Insurance & Trust Co., 27 Cal.2d 457, 462, 165 P.2d 15, 163 A.L.R. 838; Stowe v. Fritzie Hotels, Inc., 44 Cal.2d 416, 425, 282 P.2d 890.

Plaintiffs' 'Third Amended Complaint in Equity for Declaratory Relief' alleges that plaintiffs are minors, acting by their duly appointed, qualified and acting guardian; that defendant Pacific Valves is a California corporation with its principal office in Signal Hill, Los Angeles County; that defendants Howard C. Dumm and Irving M. Dumm are the president and secretary-treasurer and they and defendants Robert J. Dumm and Irving M. Dumm III are the directors of said corporation; that said corporation has issued only 25,000 shares of no par value capital stock, all of the same class; and that 22,855 shares thereof are owned and controlled by the defendants, 22,050 shares by defendants Irving M. Dumm, Howard C. Dumm and Robert Dumm.

'VIII. That continuously since on or about the 1st day of December, 1951, 180 certain shares of stock of said corporation belonging to these minor plaintiffs, have been, and still are, held in the possession of the defendants, Howard C. Dumm, Irving M. Dumm and Robert J. Dumm.

'IX. That on the 26th day of March, 1951, John F. Dumm, Sr., who was the father of these plaintiffs, died, having made his will wherein he devised and bequeathed in trust 1,250 shares of stock of said corporation, to be held for these minor plaintiffs during their minority, and to be delivered over to said minor plaintiffs upon the attainment of their majority; that said testamentary trust was thereafter duly approved by the above entitled Court in the Matter of the Estate of John F. Dumm, Sr., deceased, No. LB P-22262; that by reason thereof these plaintiffs, and each of of them, were at all of said times, and still are, beneficiaries of said testamentary trust.

'X. That continuously from, on or about the 26th day of March, 1951, to and including the present time, the defendants, and each of them, excepting the defendant, Irving M. Dumm III did, from and out of the profits and earnings of said corporation, take, appropriate and distribute among themselves, and convert to their own use and conceal from these plaintiffs large sums of money, the exact amount of which is unknown to plaintiff, but that plaintiff is informed and believes, and upon those grounds alleges said sum to be in excess of the sum of $250,000.

'XI. That a controversy exists between these minor parties plaintiff and parties defendant, and each of them, in that:

'(a) Plaintiffs contend that the monies received and held by said defendants, and each of them, as alleged hereinbefore in Paragraph X, are dividends payed by said defendant corporation, and that these minor plaintiffs are entitled to have and receive a portion therefrom.

'(b) Plaintiffs contend that as beneficiaries under said testamentary trust that they are entitled to receive the income accruing to, or produced by the shares of stock of said corporation in which they hold...