XPO Logistics Drayage, LLC v. Epson Am. Inc.

• Decision Date: 30 June 2020
• Docket Number: B298647
• Parties: XPO LOGISTICS DRAYAGE, LLC, et al., Plaintiffs and Appellants, v. EPSON AMERICA INC., Defendant and Respondent.
• Court: California Court of Appeals Court of Appeals

XPO LOGISTICS DRAYAGE, LLC, et al., Plaintiffs and Appellants, v. EPSON AMERICA INC., Defendant and Respondent.

B298647

COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION ONE

June 30, 2020

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Los Angeles County Super. Ct. No. NC061524)

APPEAL from a judgment of the Superior Court of Los Angeles County, Michael P. Vicencia, Judge. Affirmed.

The Uthoff Law Corporation and Stephen M. Uthoff for Plaintiffs and Appellants.

Keesal, Young & Logan, Terry Ross and Joshua Norton for Defendant and Respondent.

____________________ Plaintiffs XPO Logistics Drayage, LLC and XPO Logistics Port Services, LLC (collectively, XPO) appeal from a judgment entered in favor of defendant Epson America, Inc. (Epson) after the trial court granted Epson's motion for summary judgment. XPO challenges orders granting Epson's motion for summary judgment, denying XPO's motion for summary judgment, and sustaining Epson's demurrer to certain causes of action. We affirm.

FACTUAL SUMMARY

Transoceanic shipping contracts can be categorized as container yard to container yard (CY/CY) contracts or container yard to door (CY/Door) contracts. Under a CY/CY contract, the ocean carrier is responsible for delivering cargo from a port of loading to a port of discharge and no farther; the consignee of the cargo is responsible for arranging transportation from the port of discharge to another place specified by the consignee. Under a CY/Door contract, by contrast, the ocean carrier is responsible for transporting the cargo from the port of loading to the consignee's "door"; if necessary, the ocean carrier must use a third party motor carrier to deliver the cargo to the consignee. Under a CY/Door contract the consignee pays the ocean carrier an all-inclusive rate that covers the overland portion of the shipment as well as the transoceanic portion, and the ocean carrier pays the motor carrier for the overland portion.

In 2015 Epson solicited bids from ocean carriers for a CY/Door contract to transport its products from ports in Asia to its distribution centers in California and Indiana. In connection with that solicitation, Epson "vetted" and "nominated" two "preferred" motor carriers for the overland portion of the contract, one of which was XPO. Hanjin Shipping Co., Ltd. (Hanjin), bid for the Epson contract and selected XPO as the motor carrier for theinland deliveries. Epson awarded the contract to Hanjin. In acting as the overland motor carrier, XPO understood that it would make its deliveries for Epson under a CY/Door contract and would bill Hanjin for its services.

Hanjin began shipments under the Epson contract in May 2016. For each shipment, Epson paid Hanjin the all-inclusive amount due under the contract prior to the time the cargo reached the port of discharge in the United States. When the cargo containers arrived in the port, Hanjin issued work orders to XPO identifying the containers, providing delivery instructions, stating the price, and indicating that the work is provided under a CY/Door contract. XPO provided Epson with daily reports on the status and availability of Epson's shipping containers. Epson issued delivery orders to XPO identifying the containers it wanted delivered, stating the delivery address, and noting: "BILL TO: HANJIN." XPO then delivered the cargo to Epson's distribution centers and issued a delivery receipt with the note: "BILL TO HANJIN SHIPPING." XPO thereafter billed Hanjin for its services based on Hanjin's work order.

On August 31, 2016, Hanjin commenced a proceeding in South Korea under that country's Debtor Rehabilitation and Bankruptcy Act and ceased doing business. At that time, some of Epson's cargo was on Hanjin ships and at ports in the United States.

After the bankruptcy proceeding commenced, Hanjin changed the bills of lading for its Epson shipments to a CY/CY basis. On September 2, 2016, XPO and Epson agreed that Epson would thereafter pay XPO to deliver Epson's cargo that was in transit at the time Hanjin filed for bankruptcy. The parties refer to these deliveries as post-petition deliveries. Epson had paid XPO for these deliveries and XPO asserts no claim concerning them.

This litigation is concerned with the invoices XPO submitted to Hanjin for deliveries made prior to Hanjin's bankruptcy—the pre-petition deliveries. After Hanjin's bankruptcy, XPO requested that Epson pay for the pre-petition deliveries.¹ Epson, which had previously paid Hanjin the all-inclusive payments for the pre-petition deliveries, declined the request.

PROCEDURAL HISTORY

In February 2018, XPO filed its first amended complaint against Epson to recover the sum of the invoices for the pre-petition deliveries. XPO alleged causes of action for breach of written contract, breach of oral contract, breach of implied contract, "goods wares and services," open book account, unjust enrichment, and quantum meruit.

Epson demurred to the first amended complaint. The court sustained the demurrer as to each cause of action other than those for breach of oral contract and for goods, wares, and services. The court granted XPO leave to amend as to the causes of action to which the demurrers were sustained.

In August 2018, XPO filed its second amended complaint alleging breach of oral contract and common counts for "Goods Wares and Services," "Open Book Account," and "Quantum Meruit."² (Boldface omitted.) XPO alleged that during the years 2015 through 2018 Epson had a pattern of conduct of requestingquotes from XPO for transportation services. XPO would provide quotes and Epson "would agree upon rates for specific services." Epson would subsequently provide XPO with instructions for transporting Epson's cargo. Epson "directed the movement of the cargo or was entitled to possession of the cargo." For each shipment, XPO generated a delivery receipt or delivery memo, which constituted a bill of lading for moving Epson's cargo, and an invoice for the shipment. XPO attached to the second amended complaint a list of the unpaid invoices for pre-petition deliveries and samples of a delivery receipt and delivery memo.

Under the goods, wares, and services count, XPO further alleged that Epson "became indebted to [XPO] for goods wares and services performed by [XPO] for the benefit of [Epson] for the services as invoiced in [exhibits attached to the pleading], for which [Epson] is obligated to pay [XPO]. [¶] . . . Despite due demand, the sum of $692,732.00 is now due, owing and unpaid from [Epson] for said goods wares and services."

Under the "quantum meruit" count, XPO alleged that Epson "has requested from [XPO] by words or conduct, that [XPO] perform services for the benefit of [Epson]. [¶] . . . [XPO] performed services as requested. [¶] . . . [Epson] has not paid [XPO] for the services. [¶] . . . [And] [t]he reasonable value of the services is $692,732.00."

Epson filed an answer to the second amended complaint.³

In October 2018, XPO and Epson filed cross-motions for summary judgment. Each filed objections to particular evidence submitted by the other.

On December 20, 2019, the court ruled on the parties' objections, granted Epson's motion for summary judgment, and denied XPO's motion for summary judgment. XPO timely appealed.

DISCUSSION

A. Summary Judgment Motions

XPO challenges the court's rulings granting Epson's motion for summary judgment and denying its motion for summary judgment. We affirm the trial court's ruling on Epson's motion and, for that reason, the challenge to the ruling on XPO's motion is moot. (See Auchmoody v. 911 Emergency Services (1989) 214 Cal.App.3d 1510, 1521.)

We review a trial court's summary judgment ruling "de novo, liberally construing the evidence in support of the party opposing summary judgment and resolving doubts concerning the evidence in favor of that party." (State of California v. Allstate Ins. Co. (2009) 45 Cal.4th 1008, 1017-1018.)

Summary judgment is proper when all the papers submitted on the motion show there are no triable issues of material fact and the moving party is entitled to judgment as a matter of law. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843; Code Civ. Proc., § 437c, subd. (c).) Epson, as a defendant moving for summary judgment "bears the burden of persuasion that 'one or more elements of' the 'cause of action' in question 'cannot be established,' or that 'there is a complete defense' thereto." (Aguilar, supra, 25 Cal.4th at p. 850.)

1. Common Count for Services Performed

XPO alleges in its cause of action for "Goods Wares and Services" that Epson "became indebted to [XPO] for goods wares and services performed by [XPO] for the benefit of" Epson as shownby the invoices for its pre-petition services; and Epson is obligated to pay, and has refused to pay, those invoices in the sum of $692,732.00. The cause of action is a form of indebitatus assumpsit common count. (See 4 Witkin, Cal. Procedure (5th ed. 2020) Pleading, § 557, pp. 685-686 & §§ 561-564, pp. 688 690; King, The Use of the Common Counts in California (1941) 14 So.Cal. L.Rev. 288, 290, fn. 10.)

Although the cause of action requires plaintiff to establish that the defendant is "indebted" to the plaintiff for the sum the plaintiff seeks, the debt need not be founded upon an express promise and does not depend upon evidence of contractual privity; rather, it arises from "such circumstances that in equity and good conscience," the defendant ought to pay the plaintiff. (Philpott v. Superior Court (1934) 1 Cal.2d 512, 523.) Such circumstances exist when, for example, a defendant obtains the plaintiff's money, goods, or services by mistake, pursuant to a contract that...