Fidelity & Deposit Co. of Md. v. Claude Fisher Co.

• Decision Date: 19 June 1958
• Citation: 161 Cal.App.2d 431,327 P.2d 78
• Court: California Court of Appeals Court of Appeals
• Parties: FIDELITY AND DEPOSIT COMPANY OF MARYLAND, a corporation, Plaintiff and Cross-Defendant, v. CLAUDE FISHER COMPANY, Ltd., a corporation, Defendant, Cross-Complainant and Appellant. State of California, Cross-Defendant and Respondent. Civ. 22941.

Page 78

327 P.2d 78

161 Cal.App.2d 431

FIDELITY AND DEPOSIT COMPANY OF MARYLAND, a corporation, Plaintiff and Cross-Defendant, v. CLAUDE FISHER COMPANY, Ltd., a corporation, Defendant, Cross-Complainant and Appellant State of California, Cross-Defendant and Respondent.

Civ. 22941.

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

June 19, 1958.

Rehearing Denied July 14, 1958.

Hearing Denied Aug. 13, 1958.

Leon J. Garrie, Los Angeles, for appellant.

Robert E. Reed, Harry S. Fenton, Robert F. Carlson, Sacramento, William S. Ashton, Jr., Salinas, for respondent.

LILLIE, Justice.

The action herein arises out of a highway construction contract between appellant Claude Fisher Company and the State of California entered into on February 5, 1951. On April 8, 1952, appellant's work was terminated by the state and the balance of the project was completed by another contractor. The Fidelity and Deposit Company, surety on Fisher's construction bond, paid the state the sum of $163,421.79 on the bond and thereafter instituted the present action against the Claude Fisher Company to recover the amount paid. The Claude Fisher Company then filed a cross-complaint against the Fidelity and Deposit Company and the State of California, which is denominated: 'Cross- Complaint For Declaratory Relief, Monies Due On Contract, And Damages For Breach Of Contract.' Thereafter the state made a motion to dismiss on the ground that the court lacked jurisdiction because the claim upon which the action was brought was not presented to the State Board of Control within two years after the claim first arose or accrued, as required by section 16044 of the Government Code. There is no dispute as to the various steps taken or their respective dates.

The gist of appellant's cross-complaint is that the state had failed to facilitate the work involved in the construction contract, delayed work thereon and prevented the contractor from diligently prosecuting the same. It is particularly alleged that the contract required the state to furnish all necessary rights of way; adequate working room and a proper site in which to work; that it was obligated to remove obstructions and obstacles from the right of way, including certain utility transmission towers, prior to March 15, 1951, and that it was required to have the route and right of way adequately surveyed and marked at all times. Appellant further alleged that the state failed to perform such obligations and that it unreasonably delayed the work through the spring months, as a result of which the Claude Fisher Company was forced to perform grading work in the wet, winter months at increased costs resulting in damages. Appellant charged that as a result of such breaches of contract, its 'financial resources and credit were seriously depleted, whereupon on or about the last week in March, 1952 cross-complainant did treat said construction contract as terminated as a result of the aforementioned acts on the part of the cross-defendant State of California'; and that thereafter the state terminated cross-complainant's work and relet the contract to another contractor.

The cross-complaint then averred a contract provision to the effect that within 30 days after completion of the work and its acceptance by the Director of Public Works, the state engineer should make and submit to the contractor a proposed final estimate of work done under the contract and the value thereof; that 30 days thereafter cross-complainant should submit to the engineer its written approval of such estimate, or a written statement of all claims for additional compensation under the contract, after which a semifinal estimate should be made and submitted by the engineer and that the amount found due should be paid within 30 days. It is further alleged that the state engineer failed to submit a final estimate within the required 30-day period, but that on May 18, 1953, the state notified Fisher to submit its claim to the engineer, which it did on June 22, 1953. The claim was denied by the engineer on August 10, 1955, except as to the sum of $9,607.69, which amount cross-complainant refused to accept. It did not file its claim with the State Board of Control until February 21, 1956. This claim was denied on July 27, 1956.

No answer to the cross-complaint was filed but the state made the motion to dismiss here under discussion. In opposition thereto, the Claude Fisher Company maintained that the claim did not accrue until August 10, 1955, when the state engineer made his valuation of the amount purportedly due it and denied its demand for the damages subsequently set forth in the claim. Using this date appellant's claim, filed with the State Board of Control on February 21, 1956, would be within the statutory two-year period.

Appellant's first contention is that the lower court had no authority to dismiss the cross-complaint and that the filing of an answer by the state was a prerequisite to the filing and granting of such motion under section 437c of the Code of Civil Procedure, as it existed prior to September 11, 1957, the effective date of an amendment which allows the filing of a motion to dismiss prior to the filing of an answer.

The respondent's answer to this argument is that by virtue of its inherent power to prevent abuse of judicial process, a court has authority to grant a (speaking) motion to dismiss based upon uncontroverted facts showing that the action has no merit. Apropos this same matter, respondent further maintains that even though there may have been a procedural error in the court's dismissal of the action on motion rather than by demurrer, such an error cannot be deemed reversible if a general demurrer would have been sustained without leave to amend.

In reference to the so-called 'speaking motions,' referred to by respondent as precedents for the motion to dismiss in the present case, the Supreme Court has this to say in Pianka v. State of California, 46 Cal.2d 208, 211, 293 P.2d 458, 461: 'However, nonstatutory speaking motions have now been superseded by the procedure governing motions for summary judgment contained in section 437c of the Code of Civil Procedure. This section was originally very limited in scope, but it has been broadened by a series of amendments and now applies 'in any kind of action' and * * * all types of proceedings. * * * The remedy afforded by this section is broad enough to cover all situations in which speaking motions have been employed, and there is therefore no longer any need for the nonstatutory procedure. In the interests of orderly and efficient administration of justice the litigant should be required to employ the statutory remedy, and a speaking motion to dismiss should be treated as a motion for summary judgment in order to preserve the safeguards provided by the statute.'

Assuming, without deciding, that the respondent's motion to dismiss was not strictly or technically proper, such error, if any, must be considered nonprejudicial since it is clear from the record that the same result would have ensued had the matter been presented in some other manner. The very fact utilized as the basis for the motion to dismiss, that the claim against the state was presented to the State Board of Control on February 21, 1956, more than two years after the cause of action arose, is definitely pleaded in appellant's cross-complaint and hence was a matter appearing on the face of the cross-complaint. Proper procedure is always to be desired and encouraged but dereliction in this respect is not necessarily fatal.

The language of the reviewing court in Stafford v. People ex rel. Dept. of Public Works, 144 Cal.App.2d 79, 81, 300 P.2d 231, 233, is applicable to the instant controversy: 'But regardless of any questions of procedure in the trial court they are of no moment on the appeal if they did not prevent a full and fair disposition of matters in issue or result in harm to plaintiff, Code of Civ.Proc., § 475; Const. art. 6, § 4 1/2; 4 Cal.Jur.2d 499.' In this connection it is interesting to note that, in the lower court, appellant did not see fit to raise any question about the propriety of respondent's use of the motion to dismiss. Apparently the entire matter was duly argued and considered upon its merits. Regardless of the fact...