Marchese Bros. v. A. Lyon & Sons
| Decision Date | 16 February 1954 |
| Court | California Court of Appeals Court of Appeals |
| Parties | MARCHESE BROS. v. A. LYON & SONS et al. Civ. 15710. |
Curtis H. Palmer, Los Angeles, J. Albert Hutchinson, San Francisco, for appellants.
Gallagher, Ruffo & Rainville, Albert J. Ruffo, San Jose, for respondent.
Plaintiff is a corporation with its principal place of business in Santa Clara County. Defendants are a partnership with their principal place of business in Los Angeles. Two of the partners, A. Lyon and William Lyon, reside in Los Angeles, the third, Leon Lyon, resides in Kentucky. Plaintiff purchased 100 barrels of brandy from defendants subject to an express warranty. After the merchandise had been delivered and the purchase price paid, plaintiff brought this action in Santa Clara County, claiming that the brandy was not as warranted, offering to return the quantity still on hand and demanding the return of the purchase price of the quantity still on hand, plus expenses incurred. Defendants moved for a change of venue to Los Angeles County on the ground of residence and on the ground that the contract was made in that county. The motion was denied. Defendants appeal.
The pertinent facts are set forth in the complaint and affidavits filed on the motion. The facts are not in dispute. On May 16th and 24th, 1951, appellants sold two lots of imported brandy to respondent. Each of the invoices for these two shipments, which were sent from appellants' Los Angeles office to respondent in San Jose, contained an express warranty to the effect that 'This merchandise is guaranteed to have Federal ATU [Alcohol Tax Unit] approval as 20 year Old Brandy and pass all Food and Drug Administration regulations.' The complaint alleges that when the brandy was received it carried the necessary federal approval of its sale as twenty-year-old brandy but that, about April 15, 1952, the Alcohol Tax Unit rescinded this approval, because, according to the information and belief of respondent, such agency found that the brandy was not twenty-year-old brandy. Respondent thereupon served on appellants a notice of rescission, offering to restore to them the balance of the brandy still on hand, and demanding the return of the purchase price of that amount of the brandy. Thereafter, this action was brought in Santa Clara County.
The affidavit of A. Lyon, one of the appellants, avers that after the brandy was imported by appellants, they authorized one Philip Marshall to solicit orders for it on a commission basis; that about May 16, 1951, Marshall called at the Los Angeles office of appellants and stated that he had an order from respondent for fifty barrels of the brandy, on condition that appellants would make the express warranty above quoted; that appellants agreed to make the warranty and accepted the order in Los Angeles county; that appellants then issued an invoice and mailed it, with a sight draft attached, to respondent in San Jose. The second sale of fifty barrels on May 24, 1951, is averred to have occurred under similar circumstances.
The affidavit of Philip Marshall avers that he is a licensed broker of alcoholic beverages in Los Angeles; that on May 16th and 24th, 1951, respectively, he received in the mail on behalf of respondent, he believes from one Ernest Baer of San Francisco, two orders, directed to appellants, for the brandy, which orders stated that they were made on condition that appellants would make the warranty above quoted; that he presented the orders to appellants at their Los Angeles office; that appellants then agreed to sell the brandy subject to that express warranty; that he received a commission on the two sales, which he divided with Baer.
The affidavit of Norman Hanak, an office employee of appellants who was present during the negotiations with Marshall over the warranty, corroborates Lyon and Marshall, and, in addition, avers that the brandy at the time of the two sales was stored in San Francisco; that the terms of the orders were the billing of warehouse receipts with sight drafts attached directed to respondent's bank in San Jose; that after the invoices and sight drafts were drawn up they were taken by appellants to a Los Angeles bank with instructions to mail them to respondent's bank in San Jose.
A counter-affidavit was filed by Paul Marchese, president of respondent. He avers that he was contacted in San Jose by Ernest Baer; that Baer, on behalf of appellants, offered to sell the twenty-year-old brandy; that he made two purchases through Baer, each sale carrying the express warranty; that the merchandise was delivered to respondent in San Francisco and payment was made pursuant to the agreement by sight draft at respondent's bank in San Jose. This affiant avers that his sole contact in the deal was with Ernest Baer; that he never dealt with Marshall; that all matters relating to the two purchases occurred in Santa Clara County; that respondent's obligation to pay arose and was to be performed in Santa Clara County.
Thus, the factual situation is simply one where Baer contacted respondent in San Jose and secured orders for the brandy on condition appellants would make the express warranties above quoted. Baer forwarded the orders to Marshall in Los Angeles. Marshall brought the orders to appellants in Los Angeles. In Los Angeles appellants accepted the orders after agreeing to make the warranties. Invoices and sight drafts were then prepared in Los Angeles and mailed in Los Angeles by a Los Angeles bank to respondent's bank in San Jose, where they were paid. The merchandise was delivered in San Francisco.
It is respondent's theory that Santa Clara County is a proper county for the trial of the action either because, under section 395(1) of the Code of Civil Procedure, appellants contracted to perform an obligation in that county, or the contracts were there entered into. Appellants dispute both contentions, urging that under the facts they are entitled to have the action tried in Los Angeles County.
Both sides agree that section 395(1) of the Code of Civil Procedure is the controlling section. It provides: ...
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