Stott v. Johnston

• Decision Date: 30 March 1951
• Citation: 36 Cal.2d 864,229 P.2d 348,28 A.L.R.2d 580
• Court: California Supreme Court
• Parties: , 28 A.L.R.2d 580 STOTT v. JOHNSTON. S. F. 18222.

Page 348

229 P.2d 348

36 Cal.2d 864, 28 A.L.R.2d 580

STOTT v. JOHNSTON.

S. F. 18222.

Supreme Court of California.

March 30, 1951.

Hill, Farrer & Burrill, formerly Hill, Morgan & Farrer, Elliott H Pentz, and David A. Thomas, all of Los Angeles, for appellant.

Frederick L. Hewitt, Edward E. Heavy, San Francisco, (Robert L. Dreyfus, San Francisco, of counsel), for respondent.

SPENCE, Justice.

Alleging a breach of warranty by reason of the sale of defective paint for use in his business, plaintiff, a painting contractor, recovered judgment upon a verdict against defendant Thomas Johnston, doing business as Johnston Paint Company, in the sum of $10,000. On appeal, defendant argues: (1) that the evidence was insufficient to establish any liability on the part of defendant; and (2) that the evidence was insufficient to sustain the amount of damages awarded. An examination of the record in the light of applicable principles of law leads to the conclusion that the judgment should be affirmed.

Plaintiff, a painting contractor of some ten year's experience, had been engaged continuously in the business of painting houses in Alameda County since January, 1945. One Jack Hendricks, salesman for defendant, called upon plaintiff in February, 1946, for the purpose of interesting him in the use of Pervo paints. At that time plaintiff told Hendricks that he was using 'Rich paint,' and Hendricks replied, 'We have as good a paint, if not better.' Wanting some assurance with respect to the quality of Hendricks' paint, plaintiff testified that he asked Hendricks about the 'company policy' in the event of 'any paint going bad at any time,' and that Hendricks replied, 'We would reimburse you a hundred percent for labor and materials for any paint that goes bad'; 'If anything went wrong with it, they would stand behind me one hundred percent.' Thereupon plaintiff purchased paint from Hendricks and during the following months painted some 50 residences and buildings with Pervo 'Fume Proof' paint. Plaintiff prepared and applied the paint as he was instructed by Hendricks. In June, 1946, plaintiff reported to Hendricks that the paint 'didn't seem to cover as well as it should.' Hendricks checked one of the jobs that plaintiff had completed and said that the paint used 'didn't contain enough pigment.' Thereafter the company purportedly improved the quality of the paint by adding more pigment and plaintiff continued to buy it.

In about October, 1946, plaintiff began to receive complaints from customers whose buildings had been painted with the Pervo 'Fume Proof' paint. He took Hendricks and Johnston to one of the buildings and after examining the job, Hendricks stated that there was 'definitely something wrong with the paint.' Johnston also agreed that there was 'something wrong with it,' and proceeded to explain to plaintiff and the owners of the building that it was not plaintiff's fault that the paint was cracking and peeling off the walls, but that plaintiff had just received 'a bum batch of paint.' Johnston further stated that his company would 'stand behing (the) job,' and told plaintiff to 'do it over,' giving him precise instructions as to how and when it should be done.

With the beginning of the year 1947, plaintiff received more and more complaints. He testified that about March, 1947, he reported to Hendricks that many of his customers were complaining 'on this paint peeling' on their jobs, and that Hendricks replied, 'I know the paint is no good, but I would appreciate it * * * if you wouldn't go telling it around town that our paint is no good, because it would hurt my sales terrible.' About two weeks later, Hendricks told plaintiff that Johnston 'just got back from Los Angeles,' where he had a 'talk with the Pervo Company,' and that 'they have O.'K.'d to go ahead and do these jobs all over as they come in.' However, plaintiff was told to get in touch with Hendricks or Johnston before redoing any job, so that they could first 'verify each and every job.' Hendricks and plaintiff agreed that Johnston would pay plaintiff $3.50 an hour for the labor to clean and paint the jobs.

About April 5, 1947, plaintiff returned to the Johnston Paint Company all the Pervo paint that he had in stock, some 276 gallons. At about the same time, plaintiff told Hendricks that he had received complaints on about 20 jobs. Hendricks then said that he did not know 'whether the company will stand good for' that many, and told plaintiff that he would have to discuss the matter with Johnston.

Plaintiff testified that in August, 1947, Johnston told him that the company would stand behind him 'one hundred percent.' In October, 1947, plaintiff telephoned Johnston at his Berkeley store and told him that he (plaintiff) had 'a lot more complaints * * * about 40' and he wanted something done about it. Johnston replied that the company 'can't stand for that' and declared, 'I don't intend to maintain your jobs.' Pursuant to their arrangement then made, Johnston went with plaintiff on November 4, 1947, to inspect the jobs. They looked at the first house, Johnston 'walked over to a window sill * * * scratched off the paint,' and then admitted that it was 'definitely over-pigmented.' Plaintiff then told Johnston that he had painted a number of houses with that same paint, that 'if it is over-pigmented, all these houses will start peeling off like this one' and his business reputation would be ruined. Johnston replied that he would 'take care of' the people who sued, and not to worry about the rest, as people forget very easily and plaintiff's reputation would not be damaged in any way. Dissatisfied with Johnston's apparent indifference as to plaintiff's undertaking with his customers, plaintiff threatened to sue Johnston. Then plaintiff suggested that they look at some more of the jobs if Johnston had any doubt as to the importance of plaintiff's having customers satisfied with the work, and the men proceeded on their round of inspection. At the next stop, Johnston again agreed and stated to the owner that the paint was 'a poor batch,' and that it was 'not (plaintiff's) fault.' But from then until the tour was completed, Johnston visibly changed his attitude. Upon their inspection of each job thereafter, he told plaintiff that the trouble lay in 'surface condition,' and that the houses plaintiff was painting were so old that they were not worth painting and 'should be burned down.'

Plaintiff testified that at the conclusion of their tour of inspection, he told Johnston that he wanted the jobs done over and $20,000 damages, and that Johnston just laughed and said, 'We might give you $5,000 and pacify these people, but we sure wouldn't give you twenty.' Plaintiff then threatened to sue, and Johnston said, 'Now, we don't have to go into that. We will call in the license inspector and if the license inspector says we are wrong, we will stand good for the jobs.' Plaintiff immediately agreed to the proposal to 'leave it up to the license inspector.' About two weeks later Johnston told plaintiff over the telephone that the state license inspector had checked several of the jobs and said that the trouble was 'surface condition.' Upon making inquiry, plaintiff discovered that Johnston had never communicated with the state license board. Plaintiff then asked the board to have the jobs checked. After plaintiff received the board's report, he telephoned Johnston and told him of its finding that he (plaintiff) 'wasn't responsible for the paint failures on (the) buildings,' and asked Johnston to make good on his promise. Johnston refused, said that he was 'not going to do anything' and told plaintiff to 'go ahead and sue.'

Plaintiff brought this action for breach of warranty, seeking damages upon these three claims: (1) $5,468.15, representing $6,185, the amount plaintiff paid for the allegedly defective paint, less a credit of.$716.85 for the return of the paint not used; (2) $50,000, as the cost necessary to repaint the buildings he had painted with defendant's defective paint; and (3) $40,000, for the loss of customers and good will. On the trial, at the conclusion of plaintiff's case, counsel and the court, in chambers outside of the presence of the jury, discussed the subject of recoverable damages. The court stated that in its opinion there was no basis for recovery on the first two items. Accordingly, only the third item of loss, the issue of damage to good will, was submitted to the jury, and it returned the verdict of $10,000 damages against defendant Johnston.

In denial of his liability, defendant first contends that the alleged statements of Hendricks and Johnston were not express warranties but only amounted to 'puffing talk.' To that point he cites Steen v. Southern California Supply Co., 74 Cal.App. 265, 239 P. 1098. That case is clearly distinguishable as it involved only general 'puffing' statements concerning quality, unaccompanied by any definite promises. Here, on the contrary, Hendricks not only gave assurance as to the high quality of the paint but promised that defendant would reimburse plaintiff 'a hundred per cent for labor and materials for any paint that goes bad' and that '(i)f anything went wrong with it, they would stand behind (plaintiff) one hundred percent.' Plaintiff testified that he wanted 'an assurance' before changing from the paint which he was using to defendant's paint, and that it was the receipt of his assurance which prompted him to try the Pervo paint. Cf. Chamberlain Co. v. Allis-Chalmers Mfg. Co., 74 Cal.App.2d 941, 943, 170 P.2d 85.

'Any affirmation of fact or any promise by the seller relating to the goods is an express warranty if the natural tendency of such affirmation or promise is to induce the buyer to purchase the goods, and if the buyer purchases the goods relying thereon. No affirmation of the value of the goods, nor any statement purporting to be a statement of the seller's opinion only shall be...