Merchants Service Co. v. Small Claims Court

216 P.2d 846, 35 Cal. 2d 109, 1950 Cal. LEXIS 319
CourtCalifornia Supreme Court
DecidedApril 12, 1950
DocketS. F. 18069
StatusPublished
Cited by6 cases

This text of 216 P.2d 846 (Merchants Service Co. v. Small Claims Court) is published on Counsel Stack Legal Research, covering California Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Merchants Service Co. v. Small Claims Court, 216 P.2d 846, 35 Cal. 2d 109, 1950 Cal. LEXIS 319 (Cal. 1950).

Opinion

SPENCE, J.

Plaintiff petitioned the superior court for a writ of mandate to compel the clerk of the Small Claims Court in San Francisco to accept for filing therein a claim for $14.13. Defendants interposed a demurrer to the petition, thereby submitting the matter “on the papers of the applicant.” (Code Civ. Proc., § 1094; Scannell v. Wolff, 86 Cal.App.2d 489, 491-492 [195 P.2d 536].) The demurrer was overruled and the court ordered a peremptory writ to issue. From the judgment accordingly entered, defendants appeal.

Plaintiff’s claim was rejected by the clerk on the ground that it appeared to be based on an assignment. Section 117f of the Code of Civil Procedure provides that ‘ ‘ No claim shall be filed or prosecuted in such small claims court by the assignee of such claim.” An analysis of the two papers constituting plaintiff’s claim—attached to the petition for a writ of mandate and designated Exhibits A and B—sustains the propriety of the clerk’s action.

Exhibit A is on the form provided by the clerk for the use of claimants, consisting of a completed questionnaire and an affidavit and order as prescribed by section 117b of the Code of Civil Procedure. It thereby appears that Mrs. Wilma Bradford, defendant, is indebted to plaintiff, Merchants Service Company, in the sum of $14.13 for money due under a written contract; that a demand was made and refused and nothing paid; and the residence of defendant and the place of business of plaintiff are given.

Exhibit B is the “written contract” to which reference is made in Exhibit A. It consists of a printed form containing questions calling for information respecting the financial responsibility and resources of a prospective customer. Below *111 this form it appears that the subject of sale was a “ladies ring” for the price of $12.50 plus 38 cents sales tax and “Service and/or Excise Taxes” $1.25, total $14.13; and that the sale was on “Budget Account Terms $1.00 each week Beginning January 17, 1948.” Printed on the reverse side is the purchaser’s agreement, signed by Mrs. Bradford, acknowledging “receipt ... of [the] merchandise . . . described . . ., for which payment is to be made to the Merchants Sendee Company, . . . called Creditor, in the sum there specified on the terms set forth.” This agreement is reproduced in full below, omitting a form to be executed by cosigners or guarantors and which was not executed. 1

Immediately following and as a part of the same printed document appears a formal statement signed by Sol Michaels, *112 showing Mm to “relinquish, disclaim, and quitclaim any right, title or interest in and to the merchandise or demands therein described unto Merchants Service Company” and to “guarantee” the validity of “the above contract.” This agreement by Michaels is likewise reproduced in full below. 2

*113 From these “papers” it is apparent that Mrs. Bradford purchased a ring from the seller, Sol Michaels, and that she was obligated to malte “payment” therefor “to the Merchants Service Company.” Such transaction, plaintiff maintains, evidences a contract of sale for its express benefit (Civ. Code, § 1559; Hartman Ranch Co. v. Associated Oil Co., 10 Cal.2d 232, 244 [73 P.2d 1163]), an original obligation in its favor (J. F. Hall-Martin Co. v. Hughes, 18 Cal.App. 513, 516 [123 P. 617]), which it, as the primary creditor of the purchaser, was trying to enforce directly in the court having jurisdiction of its claim as so limited in amount (Code Civ. Proc., §117). But such argument gives effect only to part one of Exhibit B above quoted, the agreement signed by Mrs. Bradford and establishing a debtor-creditor relationship between her and plaintiff; and it disregards the purport of part two of Exhibit B above quoted, the relinquishment signed by Sol Michaels, the merchant, as a factor affecting the three-party undertaking and indicating the derivative basis of plaintiff’s claim against the purchaser. A consideration of the two parts of the agreement together compels the conclusion that plaintiff’s status is that of an assignee rather than that of the ordinary third party beneficiary, and that its claim is therefore not cognizable in the small claims court. (Schwartz, Inc. v. Burnett Pharmacy, 112 Cal.App. Supp. 781, 785 [295 P. 508].)

The writing signed by Michaels shows on its face that he was the original claimant against the purchaser by reason of his sale and delivery of the ring to her. It was only by reason of his relinquishment of his right to make a demand upon her for the purchase price that plaintiff’s corresponding right against her arose, and so plaintiff was substituted for the normal creditor, the seller, in the transaction. Thus the writing executed by Michaels speaks in the past tense of “demands therein described” which are relinquished and quit- claimed, and it shows that the contract of sale had been consummated, for Michaels guaranteed that “the above contract (part one of Exhibit B, supra) is a valid, bona fide and subsisting agreement” (emphasis added), and that the merchandise sold had been delivered. The “demands therein described” constitute a chose in action, consisting of the right to receive from the buyer the deferred payments of the purchase price which became owing to the seller, Michaels, as soon as he delivered the ring. Such transfer of rights in connection *114 with property ordinarily indicates an assignment (4 Am.Jur. § 2, p. 229; Estate of Beffa, 54 Cal.App. 186, 189 [201 P. 616]; see, also, Commercial Discount Co. v. Cowen, 18 Cal.2d 610, 614 [116 P.2d 599]), and the studious avoidance of the word “assign” in the language of the relinquishment cannot affect its proper classification as an assignment. Moreover, Michaels ’ guarantees as to (1) the validity of the “subsisting” contract for payment of the purchase price and (2) the genuineness of “all signatures appearing thereon” are warranties that are typical of those which ordinarily accompany an assignment. (See 4 Am.Jur. § 100, pp. 308-309.)

While the writing signed by the purchaser (part one of Exhibit B, supra) shows a debtor-creditor relationship existing between her and Merchants Service Company, the same relationship must first have existed between her and the seller Michaels, for otherwise Michaels had no 1 ‘ demands ’ ’ to relinquish. In short, the significant events in the three-party transaction clearly appear to have transpired in this sequence: (1) the purchaser’s obligation to pay arose immediately upon delivery of the ring; (2) the ring had been delivered before Michaels signed the relinquishment; and (3) the debtor-creditor relationship between the purchaser and Merchants Service Company as evidenced in the writing over the buyer’s signature (part one of Exhibit B,

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216 P.2d 846, 35 Cal. 2d 109, 1950 Cal. LEXIS 319, Counsel Stack Legal Research, https://law.counselstack.com/opinion/merchants-service-co-v-small-claims-court-cal-1950.