Moving Picture etc. Union v. Glasgow Theaters, Inc.

• Decision Date: 08 April 1970
• Citation: 6 Cal.App.3d 395,86 Cal.Rptr. 33
• Court: California Court of Appeals Court of Appeals
• Parties: MOVING PICTURE MACHINE OPERATORS UNION LOCAL NO. 162, Plaintiff, Respondent and Appellant, v. GLASGOW THEATERS, INC., a corporation, Defendant, Appellant and Respondent. Civ. 26201.

Page 33

86 Cal.Rptr. 33

6 Cal.App.3d 395

MOVING PICTURE MACHINE OPERATORS UNION LOCAL NO. 162, Plaintiff, Respondent and Appellant, v. GLASGOW THEATERS, INC., a corporation, Defendant, Appellant and Respondent.

Civ. 26201.

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

April 8, 1970.

Hearing Denied June 5, 1970.

Kenneth C. Zwerin, San Francisco, for appellant.

Brundage, Neyhart, Grodin & Beeson, Joseph R. Grodin, San Francisco, for respondent.

MOLINARI, Presiding Justice.

In this appeal by both parties from the judgment below Glasgow Theaters, Inc. (hereinafter referred to as 'Glasgow'), appeals from an adverse judgment in the sum of $1,209, and Moving Picture Machine Operators Union Local No. 162 (hereinafter referred to as 'Union') appeals from that portion of the judgment denying relief in the sum of $1,845.

Glasgow operates a motion picture theater which employs a number of projectionists who are members of Union. A dispute arose between Glasgow and Union concerning payments Union claimed Glasgow was obligated to make to a pension fund for the benefit of Union's members. Union contended that under a collective bargaining agreement and a supplement thereto entered into between the parties, Glasgow's payment obligation was retroactive to August 15, 1963. Glasgow maintained that its obligation to make payments commenced on August 15, 1965.

Counsel for both parties entered into negotiations for settlement of the dispute. Such negotiations resulted in an oral agreement reached by counsel on or about March 15, 1967 to settle the dispute by a compromise fixing the commencement date for the subject payments as August 15, 1964. This proposal was agreed to by Union and Glasgow, but was subsequently repudiated by Glasgow.

On August 9, 1967, Union filed a complaint, subsequently amended, against Glasgow stating three causes of action. The first sought recovery in the sum of $1,854 based on an alleged participation agreement entered into on January 24, 1966, whereby Glasgow had agreed to make pension fund payments in the sum of.$9.00 per week for 206 weeks commencing August 15, 1963. The second cause of action sought recovery of the sum of $1,486 based on the agreement allegedly reached by counsel on March 15, 1967. The third cause of action sought a declaration of rights as to Glasgow's obligation to make pension payments under the subject agreements.

Following the filing of this complaint, counsel for Glasgow directed a letter, dated August 24, 1967, to counsel for Union in which it was stated that Glasgow admitted it owed the sum of $1,209 for the period commencing August 1964 and that Glasgow was prepared to pay this amount in full satisfaction of the matter sued upon in the complaint. Union's counsel responded, by letter dated August 29, 1967, that the proposal contained in the letter of August 24, 1967 was not acceptable, but that Union was prepared to settle on the basis of the formula originally agreed upon between counsel. This letter contained the following condition: 'This proposal will not be open if my client is required to litigate the matter.'

At trial Glasgow objected to the admissibility of evidence of the negotiations between counsel on the basis that such evidence was inadmissible because it related to an attempt to compromise. These objections were overruled. In ruling on the objection the trial court stated that it was receiving the evidence relating to the negotiations in evidence but stated that it would 'decide the legal effect of it later.' The trial court found that Glasgow was indebted to Union for $1,209 for the period from August 15, 1964 to August 14, 1967 on the basis that Glasgow had admitted its liability in that sum. The court also found that Glasgow was not indebted to Union in the sum of $1,854 on the basis that the parties had entered into a written agreement on January 24, 1966 providing for pension payments in the smount of.$9.00 per week commencing August 15, 1963.

Glasgow contends that the evidence pertaining to the settlement negotiations should have been inadmissible and therefore there is no evidentiary support for the judgment against it in the sum of $1,209. Union contends that the trial court did not err in granting the judgment of $1,209 but that it did err in not granting the full relief requested. As we understand Union's contention, Glasgow is indebted to it in the sum of $1,854 for payments due from August 15, 1963, of which sum $1,209 was admitted to be due by Glasgow. In short, Union's position is that the trial court should also have awarded it the difference between these two sums.

Evidence Code section 1152 provides that 'Evidence that a person has, * * * offered or promised to furnish money, * * * as well as any conduct or statements made in negotiation thereof, is inadmissible to prove his liability * * *.' The admission of such evidence is error. (Conderback, Inc. v. Standard Oil Co., 239 Cal.App.2d 664, 684, 48 Cal.Rptr. 901; People ex rel. Dept. Public Works v. Forster, 58 Cal.2d 257, 263, 23 Cal.Rptr. 582, 373 P.2d 630.) This rule not only excludes offers to compromise but also excludes all negotiations in relation thereto unless they are otherwise admissible. (Boyes v. Evans, 14 Cal.App.2d 472, 479--480, 58 P.2d 922; People ex rel. Department of Public Works v. Lagiss, 160 Cal.App.2d 28, 34, 324 P.2d 926; Realty Co. of America v. Burton, 160 Cal.App.2d 178 194, 325 P.2d 171.) It is well settled, however, that the rule which excludes offers of compromise does not apply to statements which are in nowise connected with any attempt of compromise or are statements of fact independent of an offer of compromise. (Smith v. Whittier, 95 Cal. 279, 297--298, 30 P. 529; Kelly v. Steinberg, 148 Cal.App.2d 211, 219, 306 P.2d 955; People ex rel. Dept. of Public Works v. Glen Arms Estate, Inc., 230 Cal.App.2d 841, 863--864, 41 Cal.Rptr. 303; People ex rel. Dept. Public Works v. Forster, supra. Accordingly, evidence relative to the issue of whether there has been an accord and satisfaction is not subject to the objection that it violates the rule which excludes offers of compromise. (Conderback, Inc. v. Standard Oil Co., supra, 239 Cal.App.2d at pp. 683--684, 48 Cal.Rptr. 901.) Moreover, the statements of a party against whom a claim is made, that he is willing to settle the claim, when not connected with an offer of compromise, may be proved as an admission against interest. (People ex rel. Dept. Public Works v. Forster, supra, 58 Cal.2d at p. 263, 23 Cal.Rptr. 582, 373 P.2d 630; Kelly v. Steinberg, supra; Smith v. Whittier, supra.)

In considering whether a person's statement amounts to an ordinary admission or constitutes an offer of compromise, the intention of the party is dispositive. (People ex rel. Dept. Public Works v. Forster, supra, 58 Cal.2d 257, 265, 23 Cal.Rptr. 582, 373 P.2d 630; People ex rel. Dept. of Public Works v. Glen Arms Estate, Inc., supra, 230 Cal.App.2d 841, 864, 41 Cal.Rptr. 303.) In ascertaining this intention Forster quotes the rule from 31 C.J.S. Evidence § 285, pages 1042--1043, as follows: "If the proposal is tentative, and any statements made in connection with it hypothetical, if the offer was made to 'buy peace' and in contemplation of mutual concessions, it is as to such point a mere offer of compromise. On the other hand, if the intention is apparent to admit liability and to seek to buy or secure relief against a liability recognized as such, or if the party making the proposal apparently Intended to make No concessions but to exact all that he deemed himself entitled to, the proposal is an ordinary admission against interest and not an attempt to compromise.' (Italics added.)' (58 Cal.2d p. 265, 23 Cal.Rptr. p. 587, 373 P.2d p. 635.)

Adverting to the evidence objected to in the instant case, we first observe that, in the light of the foregoing principles, the negotiations by the attorneys for the parties leading up to and including the March 15, 1967 oral agreement of counsel were relevant on the issue of whether a settlement by the way of an accord and satisfaction had been reached between Glasgow and Union. 'The phrase 'accord and satisfaction' as it is known and applied in the law means the substitution of a new agreement for and in satisfaction of a pre-existing agreement between the same parties.' (B. & W. Engineering Co. v. Beam, 23 Cal.App. 164, 170, 137 P. 624, 626; Security First Nat. Bank of Los Angeles v. Rospaw, 107 Cal.App.2d 220, 223, 237 P.2d 76.) The 'accord' is the agreement whereby one of two parties having a right of action against the other upon a claim arising out of an existing agreement, agrees to accept from the other party something in satisfaction of such right of action different from an usually less than that which might be recovered upon the original obligation. (B. & W. Engineering Co. v. Beam, supra; Whepley Oil Co. v. Associated Oil Co., 6 Cal.App.2d 94, 112, 44 P.2d 670; Civ.Code, § 1521.) Since 'accord' signifies an agreement between the parties, the primary principles which govern the law of contracts are necessarily applicable, that is, proper subject matter, competent parties, mutual consent and consideration. (Dunlap v. Bellah, 184 Cal.App.2d 579, 586, 7 Cal.Rptr. 766; Kelly v. David D. Bohannon Organization, 119 Cal.App.2d 787, 792, 260 P.2d 646; Reid v. Overland Machined Products, 55 Cal.2d 203, 208, 10 Cal.Rptr. 819, 359 P.2d 251; Whepley Oil Co. v. Associated Oil Co., supra; Republic Indem. Co. v. Maier Brewing Co., 249 Cal.App.2d 495, 499, 57 Cal.Rptr. 670; Rabinowitz v. Kandel, 1 Cal.App.3d 961, 966, 81 Cal.Rptr. 897.)

For the principle of accord and satisfaction to apply there must be a bona fide dispute between the parties. (Kelly v. David D. Bohannon Organization, supra, 119 Cal.App.2d 787, 792, 260 P.2d 646; Whepley Oil Co. v. Associated Oil Co., supra, 6 Cal.App.2d 94, 112, 44 P.2d 670.) It is also necessary to show satisfaction as well as an...