Sherman v. Mertz Enterprises
Decision Date | 16 October 1974 |
Citation | 117 Cal.Rptr. 188,42 Cal.App.3d 769 |
Parties | , 1974-2 Trade Cases P 75,403 Robert SHERMAN, doing business as Howard's Trailer Sales, et al., Plaintiffs and Appellants, v. MERTZ ENTERPRISES, a California corporation, doing business as San Rafael Mobile Home Estates, et al., Defendants and Respondents. Civ. 43048. |
Court | California Court of Appeals Court of Appeals |
Ruffo, Ferrari & McNeil, and Thomas P. O'Donnell, San Jose, for defendant and respondent Mertz Enterprises.
Frank Heller and Richard S. Weiner, Los Angeles, for defendants and respondents Moore's Mobile Home Mart, Les Spurlock and Sunrise County Mobile Homes.
Plaintiff Robert Sherman, doing business as Howard's Trailer Sales and Bob's Trailer Sales, along with one Doug Jobson (hereinafter referred to as plaintiffs) sought an injunction and damages for unfair competition and restraint of trade against Mertz Enterprises, doing business as San Rafael Mobile Home Estates, Moore's Mobile Home Mart (hereinafter sometimes referred to as defendants), and other mobile home sales companies.
Plaintiffs filed their complaint in the Los Angeles superior court on February 21, 1973, and the application for order to show cause and preliminary injunction came on for hearing and was denied on March 6, 1973.
On March 22, 1973, defendants filed a demurrer to the complaint with supporting points and authorities, along with a motion to strike or, in the alternative, a motion for summary judgment. After consolidating all the defendants' motions, the court below, on April 6, 1973, granted their motions for summary judgment and sustained the demurrers without leave to amend.
Plaintiffs appeal from the granting of the motions for summary judgment and the demurrers.
Defendant and respondent Mertz Enterprises is the owner and developer of a mobile home park. On or about January 15, 1973, it entered into a written agreement with co-defendants Moore's Mobile Home Mart (Moore's), Sunrise County Mobile Homes (Sunrise) and S. W. Mobile Homes Sales (S. W. Mobile), who are all retail dealers of mobile homes. The purpose of the agreement was to provide a location at which Sunrise, Moore's and S. W. Mobile could conduct their sales activities and provide lot accommodations for their customers.
In accordance with the agreement, Mertz Enterprises then notified plaintiffs and other mobile home dealers that the San Rafael Mobile Home Estates park was leased full as of January 25, 1973.
On or about January 25, 1973, Moore's, by letter, advised other various mobile home dealers that although they had completely rented San Rafael Mobile Home Estates, they would be willing to provide spaces for customers of other mobile home dealers for a set-up fee of approximately $2500 if plaintiffs and others desired to place a mobile home on defendant's park.
The mobile home dealer defendants state that the set-up fee was necessary because they had received more than 40 complaints, out of 195 mobile homes in the park, which had been submitted to the Contractors License Board, and that in the future to insure high service standards, a set-up charge would be made to service and guarantee a coach for one year.
Plaintiffs contend that defendants have conspired to restrain trade and commerce with the malicious and oppressive intent to deprive plaintiffs and prospective mobile home purchasers of the right to free and unrestricted competition for the general mobile home sales business.
Plaintiffs' first legal contention is that the contracts and arrangements entered into between the defendants have been declared unlawful per se. This contention is based on plaintiffs' interpretation of the Cartwright Act ( ).
Plaintiffs' second legal contention is that the motions for summary judgment should have been denied on plaintiffs' general allegations that defendants conspired together for the purpose of restraining competition, even in the absence of a finding that the agreement constituted a 'per se illegal tying arrangement.'
A summarization of the rules governing summary judgment procedure (Code Civ.Proc., § 437c) was set out in the case of Corwin v. Los Angeles Newspaper Service Bureau, Inc., 4 Cal.3d 842, 94 Cal.Rptr. 785, 484 P.2d 953, where the court stated at pages 851--852, 94 Cal.Rptr. at page 790, 484 P.2d at page 958: '. . . 1 (See also D'Amico v. Board of Medical Examiners, 11 Cal.3d 1, 20, 112 Cal.Rptr. 786, 520 P.2d 10.)
Summary judgment, by its nature, should be sparingly granted in cases alleging antitrust activities by defendant. The plaintiff in such a case finds himself outside a door of information that can be opened only by obtaining the key from the defendants. Unless plaintiff is allowed to probe into the secrecy of defendants, he would forever be foreclosed from finding facts to support his contention. 'Trial by affidavit is no substitute for trial by jury which so long has been the hallmark of 'even handed justice. " (Corwin v. Los Angeles Newspaper Service Bureau, Inc., Supra, 4 Cal.3d at 852, 94 Cal.Rptr. at 791, 484 P.2d at 959, citing Poller v. Columbia Broadcasting (1962) 368 U.S. 464, 473, 82 S.Ct. 486, 7 L.Ed.2d 458, 464; as quoted with approval in Fortner Enterprises v. United States Steel (1969) 394 U.S. 495, 500, 89 S.Ct. 1252, 1257, 22 L.Ed.2d 495, 503.)
Plaintiffs brought their complaint against defendants for restraint of trade under Business and Professions Code sections 16720 to 16726 (the Cartwright Act). 2
'Sections 16720 and 16726 of the Cartwright Act were patterned after the Sherman Act (15 U.S.C. § 1 et seq.) and decisions under the latter act are applicable to the former. (Chicago Title Ins. Co. v. Great Western Financial Corp. (1968) 69 Cal.2d 305, 315, 70 Cal.Rptr. 849, 444 P.2d 481.) Both acts codify the general common law prohibition against restraints of trade. Section 16727 goes beyond the common law to interdict certain practices which have a tendency to lessen competition or promote monopolization. This section, enacted in 1961 (Stat.1961, ch. 738), is based on section 3 of the Clayton Act (15 U.S.C. § 14.) Hence, federal decisions interpreting section 3 are applicable to section 16727. (69 Cal.2d 305, 315, 70 Cal.Rptr. 849, 444 P.2d 481.)
Plaintiffs' first claim is that the agreement between Moore's, Sunrise, S. W. Mobile and Mertz Enterprises constituted an illegal restraint of trade. To prevail in this contention, 'it must appear from the record not only that the agreements 'create or carry out restrictions in trade' (§...
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