Firchau v. Diamond National Corporation

• Decision Date: 26 April 1965
• Docket Number: No. 19526.,19526.
• Citation: 345 F.2d 269
• Parties: Albert J. FIRCHAU, Emma Firchau Sallender, both individually, and Albert Firchau and Emma Firchau Sallender, as Trustees and as Assignees of Western Oregon Trucking Corporation, Inc., a dissolved Oregon corporation, Firchau Logging Co., Inc., a Nevada corporation, and Independent Loggers and Contractors, Inc., an Oregon corporation, Appellants, v. DIAMOND NATIONAL CORPORATION, a Delaware corporation, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

345 F.2d 269 (1965)

Albert J. FIRCHAU, Emma Firchau Sallender, both individually, and Albert Firchau and Emma Firchau Sallender, as Trustees and as Assignees of Western Oregon Trucking Corporation, Inc., a dissolved Oregon corporation, Firchau Logging Co., Inc., a Nevada corporation, and Independent Loggers and Contractors, Inc., an Oregon corporation, Appellants, v.DIAMOND NATIONAL CORPORATION, a Delaware corporation, Appellee.

No. 19526.

United States Court of Appeals Ninth Circuit.

April 26, 1965.

Clarence H. Pease, Sacramento, Cal., for appellants.

Arthur R. Albrecht, Craig McAtee, McCutchen, Doyle, Brown, Trautman & Enersen, San Francisco, Cal., for appellee.

Before CHAMBERS, HAMLEY and BROWNING, Circuit Judges.

HAMLEY, Circuit Judge:

On January 24, 1963, Albert J. Firchau and others commenced this action against Diamond National Corporation(Diamond) to recover damages in the sum of $1,500,000 for breach of contract.The action was filed in the Superior Court of the State of California in and for the County of Tehama, and was removed to the federal district court because of diversity of citizenship.On motion of Diamond the complaint, in which one claim was asserted, was dismissed on October 17, 1963.

A first amended complaint, purporting to state two claims, was filed on November 21, 1963.The first claim was in general similar to that stated in the original complaint, and sought relief in the same amount.The second claim was stated in the alternative and sought damages in the sum of $1,297,500.

On motion of Diamond, the district court also dismissed the first amended complaint on June 25, 1964.On July 21, 1964, plaintiffs filed a notice of appeal "* * * from the Order dismissing the second claim as pleaded in the first amended complaint. * * *"The court entered a final judgment dismissing the action on July 24, 1964.No further notice of appeal was filed.

Diamond has moved to dismiss the appeal for lack of jurisdiction in this court.The company argues that the order of June 25, 1964, dismissing the first amended complaint, is not an appealable order; that Firchau's purported appeal therefrom is therefore ineffectual; and that no appeal was taken from the subsequently-entered judgment dismissing the action.

An order which dismisses a complaint without expressly dismissing the action is not, except under special circumstances, an appealable order.Marshall v. Sawyer, 9 Cir., 301 F.2d 639, 643.The special circumstances under which this court will regard such an order as final, and therefore appealable, must be such as to make it clear that the district court determined that the action could not be saved by any amendment of the complaint.Marshall v. Sawyer, supra, at 643.

Assuming such circumstances did not exist in this case, the question remains whether the notice of appeal, filed on July 21, 1964, may not be regarded as running against the subsequently-filed final judgment of dismissal.

This court is extremely liberal in accepting as sufficient for the purposes of a notice of appeal informally drawn and improperly labeled documents.Poe v. Gladden, 9 Cir., 287 F.2d 249, 251;Yanow v. Weyerhaeuser Steamship Co., 9 Cir., 274 F.2d 274, 282.In this spirit, we regard the notice of appeal here in question as directed to the final judgment of dismissal, overlooking as a technical defect not affecting substantial rights, the premature filing of that notice.

The Supreme Court of the United States similarly viewed a notice of appeal filed before entry of the final decision in a criminal proceeding.SeeLemke v. United States, 346 U.S. 325, 74 S.Ct. 1, 98 L.Ed. 3.It did so in view of Rule 52(a),Federal Rules of Criminal Procedure, reading: "Any error, defect, irregularity or variance which does not affect substantial rights shall be disregarded."Since a substantially similar provision is contained in Rule 61,Federal Rules of Civil Procedure, we think the rationale of Lemke supports our view as expressed above.¹The motion to dismiss the appeal is denied.

On the merits, Firchau questions only the dismissal of the second claim of the first amended complaint, making no issue of the dismissal of the first claim stated in that pleading.

In his second claim Firchau alleged that he and Diamond, during the winter of 1960 to 1961, entered into an oral contract wherein Firchau agreed to cut and deliver to Diamond's Red Bluff or other plants, forty-five thousand M board feet of logs for a minimum price of $22.75 per thousand.Firchau further alleged that, on or about April 1, 1961, Diamond anticipatorily breached that oral contract, to Firchau's damage in the amount of $1,297,500.

In dismissing this claim for failure to state a claim on which relief can be granted the district court held that the claim is barred by California Code of Civil Procedure § 339(1).That statute provides that an action upon a contract not founded upon an instrument in writing must be brought within two years after the accrual of the cause of action.According to the allegations of the first amended complaint, the cause of action on the second claim accrued on April 1, 1961.The district court held that the action upon that claim was not brought until November 21, 1963, when the first amended complaint was filed.

Firchau argues here, however, as he did in the district court, that the second claim relates back to the date of the original complaint, and since he filed the latter pleading on January 24, 1963, which was less than two years after the accrual of the cause of action on the second claim, the California two-year statute of limitations does not bar that claim.

Consideration of this argument requires us to compare the allegations contained in the original complaint with those set out in the second claim of the first amended complaint.SeeSidebotham v. Robison, 9 Cir., 216 F.2d 816, 823.

In the original complaint Firchau alleged that, in February, 1959, he and Diamond entered into an oral contract having a term of four years.This contract, Firchau alleged, pertained to timber operations on Diamond's lands in Shasta and Tehama Counties, California, including logging, road construction, and the hauling of logs to Diamond's plant at Red Bluff, California, and elsewhere.Under the terms of this so-called "Master Agreement,"plaintiff averred, he was to log forty-five thousand M board feet each year from forest areas then generally designated, but to be thereafter specifically designated.Under this agreement, Firchau alleged, he was to haul these forest products to Diamond's plants and, during the first year he was to receive from twenty to twenty-two dollars per thousand net Scribner Decimal C scale for the logs, depending on the named area from which they were taken.

Firchau further alleged in his original complaint that, under the master agreement: (1) Firchau would build logging roads in such areas and for such prices as would be determined by the parties from time to time; (2) the price per thousand in successive years would be negotiated from a base price of twenty-two dollars per thousand depending upon variances in the cost of labor and parts, and the length of haul; (3) Firchau would purchase from Diamond certain equipment, payment to be made by deducting one dollar per thousand board feet for all deliveries made by Firchau under the master agreement; and (4) the actual areas to be logged from year to year would be in accordance with a described five-year logging program.

Firchau also alleged in the original complaint that pursuant to the master agreement: (1)he and Diamond entered into a subordinate written agreement on February 17, 1959, covering logging and associated operations from April 1 to December 15, 1959;²(2) pursuant to this subordinate written agreement, he cut, logged and delivered forty-seven thousand M board feet during the 1959 season; (3)he and Diamond entered into a substantially similar subordinate written agreement on February 8, 1960, covering logging and associated operations from March 1 to December 1, 1960; and (4) pursuant to this second subordinate written agreement, he cut, logged and delivered forty-nine thousand M board feet during the 1960 season.The original complaint (Paragraph XVI) then contains the critical allegations quoted in the margin.³

In the second claim of the first amended complaint, after incorporating by reference certain introductory paragraphs of the original complaint, Firchau stated his claim as follows:

"That plaintiffs and defendant did during the winter of 1960-1961 enter into an oral contract wherein and whereby plaintiffs would cut, log and deliver to defendant\'s Red Bluff or other plant, 45,000 M. board feet of logs for a minimum price of $22.75 per M.On or about April 1, 1961, defendant wrongfully and unlawfully anticipatorily breached said contract all to the damage of plaintiffs in the amount of $1,297,500.00.Plaintiffs have performed all covenants and conditions precedent required of them by said oral logging contract."

This being a diversity action arising under the laws of California, California Code of Civil Procedure § 339(1) providing that actions upon a contract not founded upon an instrument in writing must be brought within two years, controls.We need not decide whether California law also controls in determining whether, for the purposes of applying that statute, the second claim stated in the first amended complaint relates back to the original complaint.This is true since we would reach the same conclusion in this case whether or not California law applies.

In California, as stated in Austin v. Massachusetts Bonding & Insurance Co., 56 Cal.2d 596, 601, 15 Cal.Rptr. 817, 819, 364 P.2d 681, 683 the amended complaint would be deemed filed as of the date of the original complaint "* * * provided recovery is sought in both pleadings on the same general set of facts."And, under Rule 15(c),Federal Rules of Civil Procedure...