Higson v. Montgomery Ward & Co.

• Decision Date: 21 June 1968
• Citation: 69 Cal.Rptr. 497,263 Cal.App.2d 333
• Court: California Court of Appeals Court of Appeals
• Parties: J. Wayne HIGSON, Plaintiff, Appellant and Respondent, v. MONTGOMERY WARD & CO., Inc., a corporation, Defendant, Respondent and Appellant. Arroyo Nueces Investment Co., Inc., a corporation, King Parker, Jr., Defendants and Respondents. Civ. 24314.

Page 497

69 Cal.Rptr. 497

263 Cal.App.2d 333

J. Wayne HIGSON, Plaintiff, Appellant and Respondent, v. MONTGOMERY WARD & CO., Inc., a corporation, Defendant, Respondent and Appellant Arroyo Nueces Investment Co., Inc., a corporation, King Parker, Jr., Defendants and Respondents.

Civ. 24314.

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

June 21, 1968.

M. F. Hallmark, Edward G. Brown, Oakland, for J. Wayne Higson.

Thiel, Wallace & Bolton, Oakland, for Montgomery Ward & Co., Inc.

ELKINGTON, Associate Justice.

Plaintiff J. Wayne Higson appeals from an order granting defendant Montgomery Ward & Co., Inc. (herein called 'Ward') a new trial. Ward cross appeals from a judgment for $10,000 which was entered in favor of plaintiff after a court trial.

We shall first consider plaintiff's appeal.

The trial court specified that the new trial was granted on the ground of insufficiency of the evidence to justify the decision. Plaintiff urges, among other things, that the order is void because the trial court, although properly stating the ground of the order, did not state its Reasons as required by Code of Civil Procedure section 657, as amended in 1965. It is conceded by Ward that the trial court did inadvertently fail to state its reasons for granting the new trial.

As amended in 1965, and as pertinent here, Code of Civil Procedure section 657 ¹ provided: 'When a new trial is granted, on all or part of the issues, the court shall specify the ground or grounds upon which it is granted and the court's reason or reasons for granting the new trial upon each ground stated. * * * ( ) * * * and if the motion is granted (it) must state the ground or grounds relied upon by the court, and may contain the specification of reasons. If an order granting such motion does not contain such specification of reasons, the court must, within 10 days after filing such order, prepare, sign and file such specification of reasons in writing with the clerk. * * * ( ) On appeal from an order granting a new trial the order shall be affirmed if it should have been granted upon any ground stated in the motion, whether or not specified in the order or specification of reasons; provided, that the order shall not be affirmed upon the ground of the insufficiency of the evidence to justify the verdict or other decision unless such ground is stated in the order granting the motion; and provided further that on appeal from an order granting a new trial upon the ground of the insufficiency of the evidence to justify the verdict or other decision, or upon the ground of excessive damages appearing to have been given under the influence of passion or prejudice, it shall be conclusively presumed that said order as to such ground was made only for the reasons specified in said order or said specification of reasons, and such order shall be reversed as to such ground only if there is no substantial basis in the record for any of such reasons.'

Recently the Supreme Court in Mercer v. Perez, 68 A.C. 102, 65 Cal.Rptr. 315, 436 P.2d 315, construed for the first time the 1965 amendments to section 657. That case holds that the provisions of section 657, as amended in 1965, requiring specification of not only the grounds but also the reasons for granting a new trial, are mandatory and must be strictly followed, and that inferences may not be drawn to establish such grounds or reasons. Where the ground specified by the trial court is 'Insufficiency of the evidence to justify the * * * decision' (§ 657, subd. 6), failure to state the reasons is fatal to the new trial order insofar as it is granted on that ground. An appellate court may, however look to the record 'to find support for any Other ground stated in the motion, and (affirm) the order on such a ground.' (P. 117, 65 Cal.Rptr. p. 324, 436 P.2d p. 324.)

In the case before us, in addition to 'Insufficiency of the evidence to justify the * * * decision' the only grounds relied upon by Ward were 'that the decision is against the law' and 'error in law occurring at the trial and excepted to by the party making the application.' It is contended by Ward that the new trial order is supported on these two last mentioned grounds. ² However, as we find no support in the record for granting a new trial on either of such grounds, the order must be reversed.

We turn now to a consideration of defendant Ward's appeal from the judgment.

The trial court found, among other things, that King Parker, Jr., and Arroyo Nueces Investment Company ³ (hereinafter called Arroyo) were agents of Ward, and as such were authorized to enter into an agreement with plaintiff for compensation for his services as a real estate broker. The court also found that plaintiff's cause of action was not barred by the provisions of Civil Code sections 1624 and 2309. Ward, as will be seen, contends that these findings are not supported by the evidence.

As has been frequently stated, when a finding of fact is attacked on the ground that there is no substantial evidence to sustain it, the power of an appellate court begins and ends with a determination as to whether there is any substantial evidence, contradicted or uncontradicted, to support the finding of fact. (Green Trees Enterprises, Inc. v. Palm Springs Alpine Estates, Inc., 66 Cal.2d 782, 784, 59 Cal.Rptr. 141, 427 P.2d 805.) We therefore, although the evidence is in conflict, state the facts as they tend to support the court's findings.

Ward wished to purchase an entire city block (herein called 'Ward block') consisting of seventeen separately owned parcels. It was important that all of the property be acquired. King Parker, Jr., was orally employed as its real estate broker for that purpose. Ward was concerned only with the gross price of the property, the details being left to Parker who had complete discretion in carrying 'out the mechanics of (the) various transactions.' His authority was general and related to the acquisition of the whole block. Separate authority as to each parcel was neither necessary, nor given. Ward knew that Parker was entering into contracts on its behalf for the purchase of real estate and for the payment of real estate brokers' commissions. It was aware of Parker's actions and it approved them.

Parker had been successful in acquiring for Ward all but one of the parcels making up the Ward block. Plaintiff Higson had been employed by Parker as broker on two of these parcels and had received commissions for his services. All of the transactions were handled by Parker through defendant Arroyo, which was a 'nominee' of Ward and Parker. The property was acquired in its name for the purpose of keeping the name of the true buyer, Ward, undisclosed.

The one remaining parcel was owned by the Harmon estate. The estate was not interested in selling, but indicated a willingness to make a tax-free exchange for acceptable income property. Parker thereupon submitted numerous proposals for such an exchange but they were all turned down. He then went to plaintiff, told him 'that we needed an income property to trade for the Harmon estate parcel' and asked for his cooperation trying to find such a property.

Plaintiff found a piece of property owned by Mr. and Mrs. Milton. Another broker, Fred Johnson, had an exclusive listing of this property for sale at approximately $160,000. After agreeing with Johnson that any commission would be split three ways--between plaintiff, Johnson and a third party--plaintiff offered the property to Parker as being available for sale. Parker in turn submitted the property to the Harmon estate for trade for the estate's property. He was told it would be acceptable on condition that a tenant be found that would produce enough income for the estate.

On November 29, 1963, Parker delivered to plaintiff an offer (called 'Deposit Receipt'), under the terms of which Arroyo offered to purchase the Milton property for $160,000. The offer was 'conditional on the satisfactory completion of lease negotiations now in progress with the prospective tenant of the undersigned.' With the 'Deposit Receipt' Parker delivered the following letter to plaintiff:

'November 29, 1963

'Mr. Wayne Higson

1404 Franklin St.

Oakland, California

Dear Mr. Higson:

In regard to the offer submitted to you by our agent, Mr. King Parker, Jr., on the property now in the name of Milton et al, please be advised that upon completion of this transaction, that is, the sale, trade or leasing of the property described in the Deposit Receipt, we will pay you the sum of $15,000 as commission for handling this portion of the transaction.

Yours very truly,

ARROYO NUECES INVESTMENT COMPANY, INC.

(S) C. M. Simonis, Secretary'

C. M. Simonis was Parker's secretary. He had dictated the letter to her.

Plaintiff, through Johnson, submitted the offer to the Miltons who turned it down because of its 'lease condition.'

On December 9, 1963, Parker delivered a new 'Deposit Receipt' with a $5,000 deposit to plaintiff for submission to the Miltons. The offer was for the same price but the lease condition was omitted. It recited 'Commission to be paid by the Buyer as per separate agreement.' It was admitted that the commission agreement of November 29, 1963, also applied to this offer. The December 9, 1963 offer was unconditionally accepted by the Miltons. They placed their deed in escrow and otherwise did everything on their part to be performed. However, the balance of the purchase price was never paid by Arroyo, Ward or Parker. After the time for closing the deal had expired the Miltons took back their papers and the $5,000 deposit was forfeited to them. Plaintiff had done everything required of him under the contract and commission agreement of December 9, 1963.

Defendants contended that the transaction was not closed because timely arrangements could not be made for leasing the Milton property as required by the Harmon estate. Parker testified that plaintiff had been informed...