Parsons v. Bristol Development Co.

CourtUnited States State Supreme Court (California)
Writing for the CourtTRAYNOR
Citation62 Cal.2d 861,402 P.2d 839,44 Cal.Rptr. 767
Parties, 402 P.2d 839 Cejay PARSONS, Plaintiff and Appellant, v. BRISTOL DEVELOPMENT CO. et al., Defendants and Respondents. L. A. 27434.
Decision Date17 June 1965

Page 767

44 Cal.Rptr. 767
62 Cal.2d 861, 402 P.2d 839
Cejay PARSONS, Plaintiff and Appellant,
v.
BRISTOL DEVELOPMENT CO. et al., Defendants and Respondents.
L. A. 27434.
Supreme Court of California, In Bank.
June 17, 1965.
Rehearing Denied July 14, 1965.

Page 769

[402 P.2d 841] [62 Cal.2d 863] Felix H. McGinnis, Torrance, for plaintiff and appellant.

Launer, Chaffee & Hanna, Daniel L. Stack, Fullerton, Miller, Nisson, Kogler & Wenke and Clark Miller, Santa Ana, for defendants and respondents.

C. Douglas Wikle, Walter Atkinson, W. Alan Thody, Los Angeles, Dell L. Falls, Lancaster, Cooper & Boller, Rowland, Paras & Clowdus and Gloyd T. Clowdus, Sacramento, as amici curiae on behalf of defendants and respondents.

TRAYNOR, Chief Justice.

In December 1960 defendant Bristol Development Company entered into a written contract with plaintiff engaging him as an architect to design an office building for a lot in Santa Ana and to assist in supervising construction. Plaintiff's services were to be performed in two phases. He completed phase one, drafting preliminary plans and specifications, on January 20, 1961, and Bristol paid him $600.

The dispute concerns Bristol's obligation to pay plaintiff under phase two of the contract. The contract provided that 'a condition precedent to any duty or obligation on the part [62 Cal.2d 864] of the OWNER (Bristol) to commence, continue or complete Phase 2 or to pay ARCHITECT any fee therefor, shall be the obtaining of economically satisfactory financing arrangements which will enable OWNER, in its sole judgment, to construct the project at a cost which in the absolute decision of the OWNER shall be economically feasible.' It further provided that when Bristol notified plaintiff to proceed with phase two it should pay him an estimated 25 per cent of his fee, and that it would be obligated to pay the remaining 75 per cent 'only from construction loan funds.'

Using plaintiff's preliminary plans and specifications, Bristol obtained from a contractor an ewstimate of $1,020,850 as the cost of construction, including the architect's fee of 6 per cent. On the basis of this estimate, it received an offer from a savings and loan company for a construction loan upon condition that it show clear title to the Santa Ana lot and execute a first trust deed in favor of the loan company.

Shortly after obtaining this offer from the loan company, Bristol wrote plaintiff on March 14, 1961, to proceed under phase

Page 770

[402 P.2d 842] two of the contract. In accordance with the contract, Bristol paid plaintiff $12,000, an estimated 25 per cent of his total fee. Thereafter, plaintiff began to draft final plans and specifications for the building.

Bristol, however, was compelled to abandon the project because it was unable to show clear title to the Santa Ana lot and thus meet the requirements for obtaining a construction loan. Bristol's title became subject to dispute on May 23, 1961, when defendant James Freeman filed an action against Bristol claiming an adverse title. 1 On August 15, 1961, Bristol notified plaintiff to stop work on the project.

Plaintiff brought an action against Bristol and Freeman to recover for services performed under the contract and to foreclose a mechanic's lien on the Santa Ana lot. The trial court, sitting without a jury, found that Bristol's obligation to make further payment under the contract was conditioned upon the existence of construction loan funds. On the ground that this condition to plaintiff's right to further payment was not satisfied, the court entered judgment for defendants. Plaintiff appeals.

The trial court properly aedmitted evidence extrinsic to the written instrument to determine the circumstances under [62 Cal.2d 865] which the parties contracted and the purpose of the contract. (Code Civ.Proc., § 1860; Civ.Code, § 1647; see Corbin, The Interpretation of Words and the Parol Evidence Rule, 50 Cornell L.Q. 161.) There is no conflict in that evidence. Bristol contends, however, that an appellate court is compelled to accept any reasonable interpretation of a written instrument adopted by a trial court whether or not extrinsic evidence has been introduced to interpret the instrument and whether or not that evidence, if any, is in conflict. We do not agree with this contention.

Since there has been confusion concerning the rules for appellate review of the interpretation of written instruments (see Estate of Platt, 21 Cal.2d 343, 352, 131 P.2d 825 (concurring opinion); Estate of Shannon, 231 A.C.A. 975, 978-979, 42 Cal.Rptr. 278), it is appropriate here to define the scope of such review.

The interpretation of a written instrument, even though it involves what might properly be called questions of fact (see Thayer, Preliminary Treatise on Evidence, pp. 202-204), is essentially a judicial function to be exercised according to the generally accepted canons of interpretation so that the purposes of the instrument may be given effect. (See Civ.Code, §§ 1635-1661; Code Civ.Proc., §§ 1856-1866.) Extrinsic evidence is 'admissible to interpret the instrument, but not to give it a meaning to which it is not reasonably susceptible' (Coast Bank v. Minderhout, 61 Cal.2d 311, 315, 38 Cal.Rptr. 505, 507, 392 P.2d 265, 267; Nofziger v. Holman, 61 Cal.2d 526, 528, 39 Cal.Rptr. 384, 393 P.2d 696; Imbach v. Schultz, 58 Cal.2d 858, 860, 27 Cal.Rptr. 160, 377 P.2d 272), and it is the instrument itself that must be given effect. (Civ.Code, §§ 1638, 1639; Code Civ.Proc., § 1856.) It is therefore solely a judicial function to insterpret a written instrument unless the interpretation turns upon the credibility of extrinsic evidence. Accordingly, 'An appellate court is not bound by a construction of the contract based solely upon the terms of the written instrument without the aid of evidence (citations), where there is no conflict in the evidence (citations) or a determination has been made upon incompetent evidence (citation).' (Estate of Platt, 21 Cal.2d 343, 352, 131 P.2d 825, 830. Accord, Moore v. Wood, 26 Cal.2d 621, 629-630, 160 P.2d 772;...

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1240 practice notes
  • McCrary Const. v. Metal Deck Specialists, No. A105392.
    • United States
    • California Court of Appeals
    • November 14, 2005
    ...instrument unless the interpretation turns upon the credibility of extrinsic evidence." (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865, 44 Cal.Rptr. 767, 402 P.2d 839.) Where the facts are undisputed, we review the trial court's application of law independently. (Ghirardo v. ......
  • Newman v. Wells Fargo Bank, No. S048669
    • United States
    • United States State Supreme Court (California)
    • December 5, 1996
    ...§ 103; Estate of Joslyn, supra, 38 Cal.App.4th 1428, 1433, 45 Cal.Rptr.2d 616; see, e.g., Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 44 Cal.Rptr. 767, 402 P.2d 839.) In so doing, when there is no conflict in extrinsic evidence, the court is not bound by inferences drawn from t......
  • University of San Francisco Faculty Assn. v. University of San Francisco, No. A017092
    • United States
    • California Court of Appeals
    • April 13, 1983
    ...is not bound by the trial court's ruling but must give the contract its own interpretation. (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865, 44 Cal.Rptr. 767, 402 P.2d 839; Davies Machinery Co. v. Pine Mountain Club, Inc. (1974) 39 Cal.App.3d 18, 23, 113 Cal.Rptr. 784; and see......
  • Pasillas v. Agricultural Labor Relations Bd., AFL-CIO and S
    • United States
    • California Court of Appeals
    • May 24, 1984
    ...although we are not bound under these circumstances by the Board's implied interpretation (cf. Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, Page 750 865-866, 44 Cal.Rptr. 767, 402 P.2d 839), we agree as a matter of law with the retroactive interpretation placed on the union secu......
  • Request a trial to view additional results
1243 cases
  • McCrary Const. v. Metal Deck Specialists, No. A105392.
    • United States
    • California Court of Appeals
    • November 14, 2005
    ...instrument unless the interpretation turns upon the credibility of extrinsic evidence." (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865, 44 Cal.Rptr. 767, 402 P.2d 839.) Where the facts are undisputed, we review the trial court's application of law independently. (Ghirardo v. ......
  • Newman v. Wells Fargo Bank, No. S048669
    • United States
    • United States State Supreme Court (California)
    • December 5, 1996
    ...§ 103; Estate of Joslyn, supra, 38 Cal.App.4th 1428, 1433, 45 Cal.Rptr.2d 616; see, e.g., Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 44 Cal.Rptr. 767, 402 P.2d 839.) In so doing, when there is no conflict in extrinsic evidence, the court is not bound by inferences drawn from t......
  • University of San Francisco Faculty Assn. v. University of San Francisco, No. A017092
    • United States
    • California Court of Appeals
    • April 13, 1983
    ...is not bound by the trial court's ruling but must give the contract its own interpretation. (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865, 44 Cal.Rptr. 767, 402 P.2d 839; Davies Machinery Co. v. Pine Mountain Club, Inc. (1974) 39 Cal.App.3d 18, 23, 113 Cal.Rptr. 784; and see......
  • Pasillas v. Agricultural Labor Relations Bd., AFL-CIO and S
    • United States
    • California Court of Appeals
    • May 24, 1984
    ...although we are not bound under these circumstances by the Board's implied interpretation (cf. Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, Page 750 865-866, 44 Cal.Rptr. 767, 402 P.2d 839), we agree as a matter of law with the retroactive interpretation placed on the union secu......
  • Request a trial to view additional results

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