Associates Discount Corp. v. Tobb Co.

241 Cal. App. 2d 541, 50 Cal. Rptr. 738, 1966 Cal. App. LEXIS 1270
CourtCalifornia Court of Appeal
DecidedApril 18, 1966
DocketCiv. 7699
StatusPublished
Cited by11 cases

This text of 241 Cal. App. 2d 541 (Associates Discount Corp. v. Tobb Co.) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Associates Discount Corp. v. Tobb Co., 241 Cal. App. 2d 541, 50 Cal. Rptr. 738, 1966 Cal. App. LEXIS 1270 (Cal. Ct. App. 1966).

Opinion

COUGHLIN, J.

Plaintiff Associates Discount Corporation, as assignee of the lessor of a lease of personal property, recovered judgment against the defendant Tobb Co., Inc., as lessee, for the balance of rental unpaid thereunder. Defendant appeals.

The lease was evidenced by a written instrument dated December 20, 1960, between Capital Resources, Inc., an equipment leasing corporation, as lessor, and Tobb Co., Inc., the defendant, as lessee; was executed on behalf of the latter by Winton B. Oster, as president, and Roy P. Berrett, as secretary; incorporated an attached “Schedule,” also executed on behalf of defendant by Oster, as president, and Berrett as secretary, and hearing the corporate seal, which provided, among other things, that the lessee should pay lessor the sum of $1,250 per month rental for 60 months; and was assigned by Capital Resources to plaintiff, Associates Discount Cor *545 poration, a commercial financing firm engaged in the business of obtaining leases at a discount.

Accompanying the lease and attached “Schedule” was a document entitled 1 ‘ Certified Copy of Resolution and Designation of Agents” executed by Berrett as secretary of defendant corporation and bearing its seal. It certified that the board of directors of defendant had adopted a resolution authorizing any officer of the corporation, among other things, “to execute, acknowledge and deliver and/or appoint another to execute, acknowledge, and deliver on behalf of this Corporation and in its name, any and all notes, drafts, assignments, repurchase agreements, bills of sale, chattel mortgages, conditional sales contracts, trust receipts and any and all other instruments which he may deem necessary or convenient in the transaction of business of the undersigned. ...”

Defendant was a corporation formed by four medical doctors, viz., Oster, Berrett, Bowers and Thayer, each of whom was a director and shareholder, and owned 25 percent of its shares. Originally defendant was the owner of the equipment covered by the lease. Oster and Berrett, doing business as Ocean Beach Medical Group, leased the equipment from defendant and paid it $1,800 per month as rental. Early in December 1960, as a result of negotiations between Oster, purportedly on behalf of defendant, a man named Morrison, representing H & M Management Company, Capital Resources and the plaintiff, defendant sold the equipment to H &' M Management Company for $50,000 which, in turn, sold it to Capital Resources for the same amount; the latter leased it back to defendant under the subject lease and assigned the same, together with its interest in the equipment, to plaintiff for $50,000; in the course of the transaction plaintiff paid $50,000 to Capital Resources, which paid the same amount to “H & M Management Corporation and Winton B. Oster, M.D.” by a check reciting, “Acceptance of this check shall constitute full payment to H & M Management Corp. for equipment sold to Capital Resources, Inc., as specified .in an inventory list captioned Exhibit ‘A’ attached to a lease agreement between Capital Resources, Inc., and Tobb Corporation. ’ ’

Two letters to “H & M Management Co.,” each dated December 1, 1960, signed by Oster for defendant as president and bearing its corporate seal, respectively demanded payment of $50,000 for the purchase of the equipment and acknowledged receipt of payment in full therefor.

*546 The lease provided for a security deposit of $6,250 which was paid by Oster to Capital Resources and retained by the latter. Following its execution Oster paid plaintiff monthly rental installments totaling $17,500. The lease provided in the event of default in payment of any installment the lessor might declare the entire rent provided for thereunder immediately due and payable. Under date of February 9, 1962, demand in writing was made upon defendant for payment of three delinquent rental installments. Upon continued failure to pay such, all the remaining rental installments were declared due and payable. Suit to recover this amount was filed. Plaintiffs in the action were Associates Discount Co., Inc., Capital Resources and a copartnership known as ThornallyBird Industries. Defendant contested liability on the ground the lease had been executed without its authority; was in violation of designated statutory provisions; constituted a usurious loan; and lacked consideration. The court found, among other things, the lease was valid; was not a loan; Capital Resources owned the equipment at the time the lease was executed, having acquired title from H & M Management Co., which in turn had acquired title from defendant; Oster and Berrett, as president and secretary respectively of defendant, had authority to transfer the equipment to H & M Management Co.; Capital Resources entered into the lease with defendant; Oster and Berrett had authority to enter into the lease; pursuant to the terms of the lease, by virtue of the accelerated payment of the agreed rental installments, there was unpaid $51,250; that, contrary to defendant’s contentions, the transfer of the equipment did not constitute a sale of substantially all of defendant’s assets subject to the regulation prescribed by section 3901 of the Corporations Code; and that Capital Resources assigned its interest in the equipment and the lease to plaintiff Associates Discount Corporation. Judgment was entered in favor of this plaintiff alone and against defendant for the amount unpaid under the lease and an additional sum of $5,500 as attorney’s fees.

On appeal defendant attacks the foregoing findings as not supported by the evidence; attacks other findings for the same reason; and contends the court erred in the rejection of testimony.

As the finding that Oster and Berrett had authority to transfer the equipment to H & M Management Company and to execute the lease is supported by the evidence, any deficiency respecting other findings sustaining the transaction on other grounds need not be considered. It is a settled *547 rule that if there is one or more sustained findings upon which the judgment may rest, it will be concluded on appeal the trial court did rest its judgment upon that finding or those findings and other findings may be disregarded. (Brewer v. Simpson, 53 Cal.2d 567, 584 [2 Cal.Rptr. 609, 349 P.2d 289].)

The finding that Oster and Berrett had authority to execute the lease is supported by the fact that it purports to be executed by them on behalf of the corporation and the “Schedule” as a part thereof likewise purports to be executed by them for the corporation and bears its seal; the further fact that a certified copy of a resolution authorizing any officer of the corporation to execute “any and all other instruments which he may deem necessary or convenient in the transaction of business” of the corporation was certified to be correct by Berrett as secretary of the corporation under the seal of said corporation; and circumstances justifying an inference that such authority had been given.

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Bluebook (online)
241 Cal. App. 2d 541, 50 Cal. Rptr. 738, 1966 Cal. App. LEXIS 1270, Counsel Stack Legal Research, https://law.counselstack.com/opinion/associates-discount-corp-v-tobb-co-calctapp-1966.