Gold v. Maxwell

• Decision Date: 14 December 1959
• Citation: 176 Cal.App.2d 213,1 Cal.Rptr. 226
• Court: California Court of Appeals Court of Appeals
• Parties: David S. GOLD, John Rich and Stan H. Ross, Plaintiffs and Respondents, v. Richard MAXWELL and David Raksin, Defendants, David Raksin, Appellant. Civ. 23686.

Page 226

1 Cal.Rptr. 226

176 Cal.App.2d 213

David S. GOLD, John Rich and Stan H. Ross, Plaintiffs and Respondents, v. Richard MAXWELL and David Raksin, Defendants, David Raksin, Appellant.

Civ. 23686.

District Court of Appeal, Second District, Division 3, California.

Dec. 14, 1959.

Abraham Marcus, Beverly Hills, for appellant.

Morton R. Goodman, Beverly Hills, for respondents.

VALLEE, Justice.

Defendant Raksin appeals from a judgment for plaintiffs in an action on a promissory note dated January 1, 1956 for $3,000, payment of which Raksin guaranteed. Defendant Maxwell did not appear in the action. As a defense, Raksin pleaded fraud in the procurement of the note and the guaranty and a counterclaim.

The court found: 1. Due execution of the note. 2. No part of the principal or interest has been paid, and there is unpaid $3,000 principal and $180 interest. 3. The note was given to plaintiffs by Maxwell as part of the purchase price for shares of stock of Coda Productions, Inc., a California corporation, which shares were then owned by plaintiffs. The shares were delivered by plaintiffs to Maxwell. 4. In connection with the purchase, Maxwell was acting as agent of Raksin. Maxwell was also employed by Coda at the time he was acting as agent for Raksin. 5. As additional consideration to plaintiffs for the stock and their acceptance of the note, Raksin executed in favor of plaintiffs a written guaranty of payment of the note. 6. Raksin admits he refuses to pay the note. 7. Certain exhibits attached to the answer were not part of the transaction between plaintiffs and Raksin.

The court also found: 1. Prior to December 30, 1955 plaintiffs and one Bradford owned all the outstanding stock of Coda. 2. Bradford was manager of Coda. 3. Prior to December 30, 1955 the owners of the stock desired to sell all or a substantial part of it, and Sunset Music Corporation was desirous of obtaining it. 4. About December 1955 Sunset was not financially in a position to undertake the purchase. 5. Bradford negotiated for the 'purchase and transfer' of 70 per cent of the stock. 6. Bradford was acting on his own behalf. His authority with respect to plaintiffs was limited to obtaining somebody who was interested in purchasing their stock. 7. Bradford, in his negotiations with Raksin and Maxwell, did not represent to them that Coda had such a financial status that its accounts receivable exceeded all of its 'payables' or that it had gross receipts of $7,000 a month. 8. It is not true that but for the representations of Bradford, Raksin would not have executed the guaranty and would not have entered into the arrangements to purchase the stock. 9. Defendants did not rely on the representations of Bradford to the effect that Coda's accounts receivable exceeded all of its 'payables,' and that it had gross receipts of $7,000 a month. 10. The representations made by Bradford were not false. 11. After the acquisition of the stock of Coda, Raksin entered into the operation of its business with Maxwell as its general manager pending transfer of part of the stock acquired to Sunset, and undertook various commitments and obligations. 12. Raksin did not learn of the alleged falsity of the representations until about 30 days after the execution of the note and the guaranty. At that time such commitments had not been made as to make it impossible for Raksin to rescind the transaction. Plaintiffs and Bradford were not then notified of the falsity of the representations. 13. About May 4, 1956 Raksin transferred to Sunset Music Corporation 45 per cent of the stock of Coda. 14. Execution of the note was not procured by fraud.

The court concluded: 1. Bradford's representations as to Coda's income were beyond the scope of his authority, and plaintiffs are not bound by them or by an agreement between Raksin and Bradford made December 29, 1955 relative to the purchase by Raksin. 2. Raksin did not reasonably rely on such representations, and was guilty of negligence and carelessness in failing to investigate further the financial condition and income of Coda. 3. Raksin was not induced to enter into the transaction by reason of Bradford's representations but was motivated solely by his desire to assist Sunset in acquiring a controlling interest in Coda. 4. An agreement of May 4, 1956 between Raksin and Sunset affirmed the value of the stock Raksin purchased December 30, 1955, and his actions after the transaction bar him from asserting his claim of fraud against plaintiffs. ¹ (In this agreement Raksin stated he had purchased 70 per cent of the outstanding stock of Coda and Sunset had purchased 15 per cent and that an additional $3,000 was payable to persons from whom he (Raksin) had purchased the stock, Raksin agreed to sell and Sunset agreed to buy 45 per cent of the 70 per cent for $3,857.14, and Sunset agreed to attempt to purchase the remaining stock of Coda.) 5. Plaintiffs are not responsible ro liable to Raksin for any losses suffered by him as a result of the transaction of the operation of Coda subsequent thereto.

In support of his position, defendant makes and variously repeats a number of points which, on analysis, come down to one contention: that the findings are unsupported by the evidence. Such contention requires defendant to demonstrate that there is no substantial evidence to support the challenged findings. Nichols v. Mitchell, 32 Cal.2d 598, 600, 197 P.2d 550. Defendant completely ignores the rule that where an appellant claims the findings, or a particular finding, is not sustained by the evidence, he is required to set forth in his brief all of the material evidence and not merely his own evidence. Defendant recites only evidence favorable to him and argues the case as though we were the judges of the weight of the evidence. It is well established that a reviewing court starts with the presumption that the record contains evidence to sustain every finding of fact. This defendant has not done. If it is not done, the error is deemed waived. Cooper v. Cooper, 168 Cal.App.2d 326, 331, 335 P.2d 983. We do not search the record to find error.

In re Estate of Good, 146 Cal.App.2d 704, at page 706, 304 P.2d 196, 197, we said:

'We have had occasion to remark before in a similar situation that a claim of insufficiency of the evidence to justify findings, consisting of mere assertion without a fair statement of the evidence, is entitled to no consideration, when it is apparent, as it is here, that a substantial amount of evidence was received on behalf of the respondents. Instead of a fair and sincere effort to show that the trial court was wrong, appellant's brief is a mere challenge to respondents to prove that the court was right. And it is an attempt to place upon the court the burden of discovering without assistance from appellant any weakness in the arguments of the respondents. An appellant is not permitted to evade or shift his responsibility in this manner. [Citation.] And upon more than one occasion we have called attention to our statement to the same effect in Goldring v. Goldring, 94 Cal.App.2d 643, 645, 211 P.2d 342, and we have said we must either abide by our former statements or tolerate practices which are contrary to first principles of appellate procedure and which place undue burdens upon the court.'

Notwithstanding defendant's flagrant violation of the rules, we have examined the record. It would serve no purpose to recite the ramifications of the transaction. Suffice it to say that from our examination of the record we are satisfied the evidence supports the court's vital findings. There was evidence which supports the finding that Bradford's sole function was to find a buyer for the stock. Assuming, as defendant contends, that Bradford made the false representations to Raksin to the effect that Coda's accounts receivable exceeded its 'payable...