Keller v. Pacific Turf Club

• Decision Date: 17 May 1961
• Court: California Court of Appeals Court of Appeals
• Parties: Dan KELLER, Plaintiff and Appellant, v. PACIFIC TURF CLUB, Webb A. Everett, Defendants and Respondents. Civ. 18812.

Page 346

13 Cal.Rptr. 346

192 Cal.App.2d 189

Dan KELLER, Plaintiff and Appellant, v. PACIFIC TURF CLUB, Webb A. Everett, Defendants and Respondents.

Civ. 18812.

District Court of Appeal, First District, Division 2, California.

May 17, 1961.

Rehearing Denied June 16, 1961.

Hearing Denied July 12, 1961.

J. A. London, Mountain View, Boccardo, Blum, Lull, Niland & Teerlink, by Edward J. Niland, San Jose, for appellant.

Donahue, Richards & Gallagher, Joseph T. Richards, Thomas Schneider, Oakland, for respondents.

KAUFMAN, Presiding Justice.

Plaintiff, Dan Keller, seeks to recover damages for breach of contract from Pacific Turf Club, a California corporation and its officers, hereafter referred to as defendants. At the close of plaintiff's case, the court granted defendants' motion for a nonsuit and plaintiff appeals. We conclude that the matter should have gone to the jury.

The granting of a motion for a nonsuit is warranted "* * * when, and only when, disregarding conflicting evidence, and giving to plaintiff's evidence all the value to which it is legally entitled, indulging in every legitimate inference which may be drawn from that evidence, the result is a determination that there is no evidence of sufficient substantiality to support a verdict in favor of the plaintiff.' (Card v. Boms (1930), 210 Cal. 200, 202, 291 P. 190; see, also, Golceff v. Sugarman (1950), 36 Cal.2d [152, at page 152, 153] 222 P.2d 665; Blumberg v. M. & T., Incorporated (1949), 34 Cal.2d 226, 229, 209 P.2d 1, and cases there cited.) 'Unless it can be said as a matter of law, that * * * no other reasonable conclusion is legally deducible from the evidence, and that any other holding would be so lacking in evidentiary support that a reviewing court would be impelled to reverse it upon appeal, or the trial court to set it aside as a matter of law, the trial court is not justified in taking the case from the jury.' (Estate of Lances (1932), 216 Cal. 397, 400, 14 P.2d 768.) In other words, while in most appeals it is the duty of the reviewing court to indulge every reasonable intendment in favor of sustaining the trial court, substantially the reverse is true when the appeal is from an order of nonsuit * * *' Raber v. Tumin, 36 Cal.2d 654, at page 656, 226 P.2d 574, at page 575; Beal v. Blumenfeld Theatres, Inc., 177 Cal.App.2d 192, 193, 2 Cal.Rptr. 110.

Stated in the light most favorable to the plaintiff, the evidence may be summarized as follows: Plaintiff, Dan Keller, also doing business as 'West Coast Fertilizer', was in the business of hauling and selling manure to mushroom farmers throughout the state. Defendants operate the 'Golden Gate Fields,' a race track in Albany and Berkeley. On October 13, 1954, the parties entered into a written contract, whereby plaintiff agreed to remove all straw and manure from the stable area at Golden Gate Fields for each of the race meets during the one year immediately following the execution of the agreement for a consideration of $10,000. Plaintiff was to begin removing all straw and manure upon the arrival of the first horses for the racing meets scheduled to begin on November 1, 1954, and March 7, 1955. Plaintiff was authorized to dispose of the manure as he desired.

The contract also contained the following option provision:

'15. Second party [plaintiff] hereby grants unto first party [defendant] the option, to be exercised by first party by notifying second party of such exercise, at least thirty days prior to the expiration hereof, [i. e. by September 13, 1955] to extend this contract for a period of one year from the termination date hereof; said one year extension to be upon all the terms, conditions and covenants herein contained, save and except that the consideration to be paid by first party to second party for any race meet during such extension is to be a total of $9000.00 for each such race meet; said $9000.00 to be paid by first party to second party upon the following basis * * *'

The next paragraph provided:

'16. All notices to be given to first party shall be given to said first party, in writing, at Post Office Box 27, Albany 6, California; notices to be given to second party shall be given to said second party, in writing, at 691 Seventeenth Avenue, Menlo Park, California.'

The agreement further provided that as security for plaintiff's performance, he was to deliver a corporate surety bond in the amount of $10,000. In lieu of this provision, however, the parties on the same day [October 13, 1954] entered into a supplemental agreement, providing that the plaintiff would deposit in escrow with George E Thomas, an attorney of the law firm representing the defendants, certain documents, including: (1) various certificates of registration and ownership [i. e. pink slips; Veh.Code, §§ 4450, 4454]; (2) a list of plaintiff's current customers; and (3) an assignment of plaintiff's accounts receivable.

It was further agreed that the escrow holder was to keep the above mentioned documents in his possession pending full performance by the plaintiff, and that for the purposes of the supplemental agreement, plaintiff's failure to remove manure as agreed was deemed to be a failure of performance on his part. Such failure of performance required the escrow holder to deliver the documents in his possession to the defendants and entitled the defendants to the right to perform the balance of the agreement for the account of the plaintiff and to attempt to dispose of the manure to plaintiff's customers. Any profit realized thereby was to be paid to the plaintiff; in the event of a loss, the plaintiff's vehicles could be sold at a public sale.

The plaintiff negotiated the above mentioned agreements with Mr. Fred Burgoyne, who was the controller and secretary of the defendants. The agreements were drawn up by defendants' attorneys. In performance of the contract, the plaintiff removed all straw and manure during the race meets in the fall of 1954 and the spring of 1955.

Early in June, 1955, the plaintiff wrote to defendants' attorneys for certain information which appeared on the pink slips held in escrow. On June 13, 1955, he again wrote and thanked them [apparently for the information] and stated: 'I was given to understand that these slips will now be forwarded to my lawyer * * *' The reply to the plaintiff from defendants' attorneys, dated June 16, 1955, stated that the pink slips were to remain in escrow for the term of the contract unless the defendants chose to exercise their option to extend the contract for an additional year. The letter continued: '* * * If this election is not made within the time provided, that is, by sometime in September, 1955, the slips are to be returned to you. If the option is exercised, the slips will remain in escrow pending performance of your obligations for the balance of the term.' ¹ Plaintiff testified that the slips were not returned to him until 1958, about 2 months before the trial in this matter, which began in November, 1958.

In July, 1955, Mr. Burgoyne told the plaintiff that the defendants had exercised their option [i. e. thus extending the term of the contract for an additional year from October 13, 1955, to October 13, 1956]. At this time, the plaintiff began negotiations with Mr. Burgoyne for a new contract for a duration of 6 or 7 years.

In a letter dated October 26, 1955, the defendants proposed to the plaintiff a new agreement relating to the removal of manure from Golden Gate Fields, extending from January 1, 1956, to December 31, 1962, on the terms of the October 13, 1954 agreement subject to a number of modifications. The final paragraph of the letter of October 26, 1955, provided: 'If the foregoing proposal meets with your approval, please indicate your acceptance on the enclosed copy of this letter, returning it to the undersigned. This proposal is made subject to the approval of the Board of Directors of Pacific Turf Club, Inc., and it is contemplated that, if accepted by you and approved by the Board, the understanding of the parties as reflected by this letter will become the subject of a formal contract to be entered into between the parties.

'Pacific Turf Club, Inc.

'/s/ ________

'By Fred Burgoyne, Secretary'

Plaintiff signed this letter to indicate his approval and returned it to the defendants.

By a letter dated November 28, 1955, defendants proposed to plaintiff an agreement relating to the removal of rubbish and dry garbage ² from Golden Gate Fields. This letter concluded with language identical to that quoted above from the letter of October 26. Plaintiff, likewise, signed and returned this letter to the defendants. About December 1, 1955, plaintiff went to Burgoyne's office to discuss the above letters. Plaintiff indicated that he was in the process of forming a corporation and wanted the contracts to be in the name of the corporation.

Defendants sent copies of the letters of October 26 and November 28 to plaintiff's attorney, pursuant to his request on February 3, 1956. Defendants write: 'These in fact are our understandings with Mr. Dan Keller and the information contained therein can be incorporated in a formal contract as soon as possible, subject to final ratification of our Board of Directors.'

Mr. Burgoyne testified that at a meeting of the Executive Committee of defendants' Board of Directors early in April, 1956, the committee 'approved the basic contents of the letters and directed me to have our attorney prepare a contract along these lines.'

Thereafter, plaintiff's attorney received the following letter, dated April 13, 1956, from defendants' attorneys:

'Sometime ago Mr. Keller and representatives of Pacific Turf Club reached an understanding concerning manure and garbage removal from Golden Gate Fields for the period ending December 31, 1962. Their understanding has now received the approval of the Board of Directors of Pacific Turf Club, Inc., and we enclose a proposed form of...