Gressley v. Williams

• Decision Date: 10 July 1961
• Parties: Dell H. GRESSLEY, Plaintiff and Appellant, v. Ben L. WILLIAMS, John M. Stokes, Harold H. Utschig, Balboa Oldsmobile, a corporation, Defendants. Harold H. Utschig and Balboa Oldsmobile, a corporation, Respondents. Civ. 24848.
• Court: California Court of Appeals Court of Appeals

Page 496

14 Cal.Rptr. 496

193 Cal.App.2d 636

Dell H. GRESSLEY, Plaintiff and Appellant, v. Ben L. WILLIAMS, John M. Stokes, Harold H. Utschig, Balboa Oldsmobile, a corporation, Defendants Harold H. Utschig and Balboa Oldsmobile, a corporation, Respondents.

Civ. 24848.

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

July 10, 1961.

James J. Oppen, Reseda, and Cecil W. Collins, Los Angeles, for appellant.

Potruch & Lerten and Erwin Lerten, Los Angeles, for respondents.

VALLEE, Justice.

Appeal by plaintiff from a judgment for defendants Harold H. Utschig and Balboa Oldsmobile, a corporation, entered on the sustaining of their demurrer to the sixth amended complaint. On the sustaining of the demurrer, counsel for plaintiff stated the did not desire to further amend and the demurrer was sustained without leave.

The sixth amended complaint is in three counts. The demurrer to counts I and II was general and special. The special demurrer was on the grounds of uncertainty, ambiguity, and unintelligibility. The demurrer to count III was general. Plaintiff contends each count states facts sufficient to constitute a cause of action. Defendants assert the general demurrer was well founded and that each count is vulnerable to the special demurrer.

It appears necessary to say again what we have said repeatedly: On appeal from a judgment sustaining a demurrer to a complaint the allegations of the complaint must be regarded as true. The court must, in every stage of an action, disregard any defect in the pleadings which does not affect the substantial rights of the parties. Code Civ.Proc., § 475. Pleadings must be reasonably interpreted; they must be read as a whole and each part must be given the meaning that it derives from the context wherein it appears. All that is necessary as against a general demurrer is to plead facts entitling the plaintiff to some relief. In determining whether the complaint is sufficient as against the demurrer on the ground that it does not state facts sufficient to constitute a cause of action, the rule is that if one consideration of all the facts stated it appears the plaintiff is entitled to any relief at the hands of the court against the defendants the complaint will be held good although the facts may not be clearly stated, or may be intermingled with a statement of other facts irrelevant to the cause of action shown, or although the plaintiff may demand relief to which he is not entitled under the facts alleged. In passing upon the sufficiency of a pleading, its allegations must be liberally construed with a view to substantial justice between the parties. While orderly procedure demands a reasonable enforcement of the rules of pleading, the basis principle of the code system in this state is that the administration of justice shall not be embarrassed by technicalities, strict rules of construction, or useless forms. Hardy v. San Fernando Valley Chamber of Commerce, 99 Cal.App.2d 572, 577-578, 222 P.2d 314.

Count I.

Count I alleges: On March 25, 1957 plaintiff entered into an oral contract of employment with defendants. On information and belief, Utschig is the sole owner and alter ego of Balboa; Balboa is influenced and governed by Utschig in that Utschig controls and operates Balboa as though it were a sole proprietorship; there is such a unity of interest and ownership apparent from the manner in which Utschig operates Balboa that the individuality or separateness of Utschig and Balboa has ceased; an adherence to the fiction of separate existence of the corporation would sanction a fraud and promote injustice in that in this case Utschig represented himself to be acting in his individual capacity as well as an agent for Balboa. Plaintiff was informed by Utschig and so believes that Utschig is and at all times herein mentioned has been the owner and holder of all the issued and outstanding stock of Balboa excepting only shares held by his wife and son to qualify them as directors; at all times mentioned Utschig controlled the board of directors of Balboa and was the representative of and the only person interested in Balboa; the identity of the two defendants is virtually identical; notwithstanding the foregoing representations, plaintiff does not know the true state of ownership of the stock of Balboa.

Count I further alleges: At all times defendants were engaged in the business of selling automobiles at a profit and had salesmen in their employ. By the contract of employment with plaintiff, defendants agreed to employ plaintiff as an automobile sales manager at a salary of $1,000 a month plus 5 per cent commission on net profits of the business, payable monthly beginning April 1, 1957 and continuing to December 1, 1958; in consideration thereof plaintiff agreed to and did terminate his then employment, did accept the position, and did move his family, home, nd residence as required by defendants. On November 30, 1957 plaintiff and defendants mutually and orally rescinded the contract of March 25, 1957. Utschig agreed to pay all accrued and unpaid commissions due under the contract of March 25, 1957. Prior to rescission plaintiff performed all the obligations, conditions, and covenants on his part to be performed. Defendants are estopped from raising the defense that the contract of March 25, 1957 is invalid under the statute of frauds. Due to the efforts of plaintiff in the performance of his duties under the contract, defendants realized a profit in the operation of the business, the amount of which is unknown to plaintiff. Defendants fail and refuse to account to and pay plaintiff commissions on the net profits of the business although requested by plaintiff so to do. It is necessary that an accounting be had in order that the amounts payable and due plaintiff be determined.

It is manifest that the contract pleaded in count I is invalid and unenforceable. An oral agreement that by its terms is not to be performed within a year from the making thereof is invalid. Civ.Code, § 1624(1). The contract alleged in count I by its terms was not to be performed within a year from its making. It is alleged to have been made on March 25, 1957 and it was to continue to December 1, 1958. This was more than one year from the making thereof. Wickson v. Monarch Cycle Mfg. Co.., 128 Cal. 156, 159, 60 P. 764; Brockman v. Lane, 103 Cal.App.2d 802, 804-805, 230 P.2d 369.

The statement that 'defendant is estopped from raising the defense that the aforesaid contract is invalid under the Statute of Frauds' does not help the pleading. This is not an allegation of an ultimate fact. It is a conclusion of the pleader. The party pleading estoppel must allege the facts giving rise thereto, and all the essential elements must be pleaded. 18 Cal.Jur.2d 412, § 13. Nor does the allegation that plaintiff fully performed all the terms and conditions of the contract take it out of the statute of frauds. The mere rendition of services is not usually such a part performance of an oral contract as will relieve the contract from the operation of the statute. Kobus v. San Diego Trust & Savings Bank, 172 Cal.App.2d 574, 579, 342 P.2d 468.

Count II.

Count II realleges the allegations of count I with respect to alter ego, the fact that defendants were engaged in selling automobiles, the realization of profits, and alleges: On November 30, 1957 plaintiff and Utschig, individually and as agent of Balboa, entered into an oral contract by which plaintiff was employed as sales manager for one year at a salary of $1,000 a month plus 1 per cent of the gross profits after $35,000 a month was grossed from the sale of automobiles by defendants from December 1, 1957 to November 30, 1958, the salary and commission to be paid monthly. Another term of the contract of November 30, 1957 was that the oral contract of March 25, 1957 would be mutually rescinded the consideration therefor being that defendants would pay plaintiff all accrued and unpaid commissions due under the contract of March 25, 1957. The salary and commission would be subject to renegotiation on November 30, 1958. In...