Marin Storage & Trucking, Inc. v. Benco Contracting & Engineering, Inc.

89 Cal. App. 4th 1042, 107 Cal. Rptr. 2d 645, 2001 Daily Journal DAR 5816, 2001 Cal. App. LEXIS 439
CourtCalifornia Court of Appeal
DecidedMay 10, 2001
DocketNo. A090915
StatusPublished
Cited by81 cases

This text of 89 Cal. App. 4th 1042 (Marin Storage & Trucking, Inc. v. Benco Contracting & Engineering, Inc.) 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
Marin Storage & Trucking, Inc. v. Benco Contracting & Engineering, Inc., 89 Cal. App. 4th 1042, 107 Cal. Rptr. 2d 645, 2001 Daily Journal DAR 5816, 2001 Cal. App. LEXIS 439 (Cal. Ct. App. 2001).

Opinion

Opinion

SIMONS, J.

In this action for indemnification, the trial court found the indemnification clause in the parties’ contract to be unenforceable because there was no mutual consent of the parties and because the clause was “procedurally” unconscionable. We reverse the judgment.

Facts

The Agreement

Marin Storage & Trucking, Inc., doing business as Reliable Crane & Rigging (hereafter Reliable), is in the business of providing cranes for rendering hoisting and rigging services. Since at least 1985, Reliable has been doing business with Benco Contracting and Engineering, Inc. (hereafter Benco), entering into short-term hourly crane rental agreements.

Pursuant to their prior pattern of dealings, Benco arranged by telephone to have Reliable provide a crane and a crane operator on August 15 and 16, 1996, for an hourly rate. Benco was the general contractor on a freeway overpass construction project in Oakland, and the crane was to be provided at the construction site for the purpose of hoisting rebar and I-beams.

The standard procedure consistently used by the parties during their long business relationship, and followed on the day in question, was to have Reliable’s crane operator fill out a form at the end of the day indicating the number of hours worked at the site. The crane operator would present that [1047]*1047form to Benco’s supervising employee at the job site, who would verify the hours and sign the form. The crane operator would give one copy of the form to the Benco signor, and return the other copies to Reliable’s office. Reliable would then mail another copy of the form to Benco with its invoice for Benco’s payment. Upon receipt of the invoice, Benco’s accounts payable department would confirm the time charged and the job number with its copy of the form and then send a check.

The form consistently used by Reliable for all of its customers, including Benco, was entitled “Work Authorization and Contract.” At the bottom of the form, just above the customer’s signature line, was the statement, “This is a contract which includes all terms and conditions stated on the reverse side.” Included on the reverse side were 10 numbered paragraphs, three of which pertained to indemnification. In particular, paragraph 3 provided: “If this Agreement involves the performance of work for Lessee/Customer on Lessee/Customer’s premises, Lessee/Customer agrees to indemnify Reliable Crane and Rigging against all loss, expense, claims and liability of any nature resulting from injury or damage to person(s) or property caused by or arising from performance of such work.” Paragraph 6 provided: “Lessee/ Customer agrees to pay reasonable attorney’s fees and court costs if legal action is taken for collection of any rental or other sums due, or for collection of loss, damage or injury to the leased equipment or person(s) or property involving such equipment where such loss, damage or injury was, directly or indirectly, caused by Lessee/Customer.”1

Over the years, going back to at least November 1985, Reliable had entered into dozens of short-term hourly contracts with Benco with the identical indemnity provisions. Although the president of Reliable had authority to negotiate the indemnity provisions, neither Benco nor any other customer had ever asked to change the indemnity terms of the Work [1048]*1048Authorization and Contract. The president of Benco testified that until the accident he had never noticed the indemnity provisions on the back of the Work Authorization and Contract forms.

On August 15, 1996, Benco’s jobsite superintendent, Art Lukado, signed the Work Authorization and Contract for the rental of a crane and crane operator as he had done on numerous occasions. The next day, August 16, 1996, Benco’s carpenter foreman, Aaron Garcia, signed the form. Mr. Garcia was a relatively new foreman and had not signed the forms before, but he did sign them on later occasions. Paragraph 10 of the Work Authorization and Contract pertained to the authority of the person signing the form: “Signing this Agreement represents and warrants that he/she is authorized to enter into this agreement on behalf of the Lessee/Customer.”

The Accident

Tri-City Reinforcing Corporation (hereafter Tri-City) was the subcontractor on the freeway construction project in charge of the iron work. On August 16, 1996, the Benco supervisor directed the crane operator from Reliable to work with the Tri-City crew. William Thompson, who was the Tri-City foreman on the project, suffered a broken leg while directing the crane operator in removing some I-beams from a support column. He sued Benco and Reliable for negligence and ultimately settled with Benco, dismissing Reliable without any payment of money by Reliable.

Procedural History

Reliable cross-complained against Benco for express indemnity. Despite the settlement and dismissal, Reliable sought indemnification for its attorney fees, totaling over $45,000, expended in the underlying lawsuit. A nonjury trial was then held on the indemnity cross-complaint.2 During trial, on its own motion, the trial court raised the question whether the Work Authorization and Contract containing the indemnification clause was an unconscionable contract of adhesion. The court requested briefing from both parties, and testimony was then taken on the circumstances surrounding the formation of the agreement.

[1049]*1049At the close of trial, the trial court issued a statement of decision, concluding that “the reverse side of [the Work Authorization and Contract] is unenforceable as lacking a mutuality of assent and as the product of procedural unconscionability.” Judgment was entered in favor of Benco.

Discussion

At the outset, we note that the trial court’s decision is internally inconsistent. Because mutual assent is essential to the existence of a contract (Civ. Code, §§ 1550, 1565), the court’s finding that there was no mutual assent to the terms of the Work Authorization and Contract was a finding that no contract had been formed. At the same time, however, the court found the terms of the Work Authorization and Contract were unconscionable, a finding which presupposes an existing contract. The doctrine of unconscionability is a defense to the enforcement of a contract or a term thereof. (Civ. Code, § 1670.5; California Grocers Assn. v. Bank of America (1994) 22 Cal.App.4th 205, 213 [27 Cal.Rptr.2d 396].) No such defense arises without a contract.

Ordinarily, inconsistent findings would be grounds for reversal. (Stiefel v. McKee (1969) 1 Cal.App.3d 263, 266 [81 Cal.Rptr. 565].) However, appellant does not raise the point, and we will resolve the inconsistency by construing the trial court’s ruling to rest on alternative grounds.

A. Mutual Assent

Every contract requires mutual assent or consent (Civ. Code, §§ 1550, 1565), and ordinarily one who signs an instrument which on its face is a contract is deemed to assent to all its terms. A party cannot avoid the terms of a contract on the ground that he or she failed to read it before signing. (Hernandez v. Badger Construction Equipment Co. (1994) 28 Cal.App.4th 1791, 1816 [34 Cal.Rptr.2d 732]; Meyer v. Benko (1976) 55 Cal.App.3d 937, 942-943 [127 Cal.Rptr. 846]; Union Bank v. Ross (1976) 54 Cal.App.3d 290, 296 [126 Cal.Rptr.

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89 Cal. App. 4th 1042, 107 Cal. Rptr. 2d 645, 2001 Daily Journal DAR 5816, 2001 Cal. App. LEXIS 439, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marin-storage-trucking-inc-v-benco-contracting-engineering-inc-calctapp-2001.