Opinion
11-14-1949
INDEPENDENT IRON WORKS, Inc. v. AMERICAN PRESIDENT LINES, Limited, et al. Civ. 14195.
Heller, Ehrman, White & McAuliffe, Lloyd W. Dinkelspiel, Caspar W. Weinberger, San Francisco, for appellant. Balter & Balter, William E. Balter, Los Angeles, for respondents.
INDEPENDENT IRON WORKS, Inc.
v.
AMERICAN PRESIDENT LINES, Limited, et al.
Nov. 14, 1949.
Hearing Granted Jan. 12, 1950.
Heller, Ehrman, White & McAuliffe, Lloyd W. Dinkelspiel, Caspar W. Weinberger, San Francisco, for appellant.
Balter & Balter, William E. Balter, Los Angeles, for respondents.
BRAY, Justice.
Plaintiff appeals from a superior court order granting the motion of defendants Eastern Iron & Metals Co., Ltd. and Max Peterman, doing business as Economy Pipe & Supply Company for change of venue from the City and County of San Francisco to the County of Los Angeles.
Record.
Plaintiff sued defendants American President Lines, Ltd. Eastern and Peterman, alleging that plaintiff was the owner of 31 reels of cable now in the possession of the President Lines, and that all defendants asserted claims therein adverse to plaintiff, and asked the court to adjudge that plaintiff is such owner and entitled to the immediate possession of the cable. President Lines filed an answer in which they set up that it was a Delaware corporation with its principal place of business is San Francisco. It admitted it now had possession of the cable at Wilmington, California, and alleged that the cable had been delivered to it in Honolulu under a bill of lading for delivery to Peterman at Los Angeles. It then set up other facts showing that the cable was now claimed by plaintiff and by defendants Eastern and Peterman. It stated that it could not safely determine ownership as between said claims, offered to deliver the cable into court, and asked the court to adjudge its ownership. It further alleged that it had a possessory lien on the cable for ocean freight, storage and other charges and asked the court to order the party to whom it determines the cable should be delivered, to pay it all charges together with costs and attorney's fees.
Thereafter defendants Eastern and Peterman filed a demurrer and upon proper pleadings moved for a change of venue to Los Angeles county, the residence of both said defendants, on the grounds of their residence, and that President Lines was not a real party in interest, but merely a stakeholder. President Lines filed a counter affidavit in which it set up that by reason of its compliance with the laws of California, its place of residence is San Francisco. This fact is not disputed. The court granted the motion for change of venue. Plaintiff appealed. President Lines did not appeal.
Question Involved.
The sole question is whether President Lines has such interest in the litigation that the action must be tried in the county of its residence, rather than in the county of the non-resident defendants.
President Lines Mere Stakeholder.
It is obvious that President Lines has no real interest in the main controversy, namely, the ownership of the cable. It admits that it is holding it merely for delivery to the rightful owner, when the court has determined which party is such owner. President Lines is just a stakeholder.
The complaint alleged that President Lines as well as the other defendants claimed an interest in the cable adverse to plaintiff. Had the court only the complaint before it, it would have been required to deny the motion. But 'the right to a change of place of trial to the residence of a defendant must necessarily be determined by the status of the parties joined as defendants in the action as revealed by the pleadings existing at the time the party claiming the right first appeared in the action.' McClung v. Watt, 190 Cal. 155, 159, 211 P. 17, 19. At the time defendants Eastern and Peterman first appeared in the action it was apparent from the answer of President Lines that its status was merely that of a stakeholder. A stakeholder does not have such an interest in the litigation as to entitle it to have the case tried in the county of its residence. Smith v. Smith, 30 Cal.App.2d 70, 85 P.2d 473, was an action brought to recover moneys on a contract. A title company with whom certain corporate stock was deposited as security for payments called for in the contract was joined as a defendant. The court held that it was merely a stakeholder and hence did not have sufficient interest in the litigation to prevent a change of venue to the county of the nonresident defendant. Sayward v. Houghton, 82 Cal. 628, 23 P. 120, was an action brought against one Houghton for refusal to transfer to plaintiff certain shares of stock in an irrigating company which was also made a defendant, in violation of an agreement to do so. The court held, 82 Cal. at page 630, 23 P. at page 120: 'There is nothing in the complaint showing, or tending to show, that the corporation defendant is in any sense interested in this action. So far as can be seen from reading the allegations of the complaint, the attitude of the defendant corporation toward its co-defendant Houghton and the plaintiff is one of absolute indifference. Quite as much so as any stake-holder could be between conflicting claimants to a fund, in his hands, to which he had no claim himself. Not having any interest in the action which can be affected in any degree by the result of a trial, it makes no difference to the corporation defendant where the action is tried.' The following statement in the Houghton case applies in the case at bar: 'The plaintiff might obtain all the relief he demands without making it [the irrigating company] a party.' 82 Cal. at page 630, 23 P. at page 120.
The cases cited by plaintiff are not in point. McClung v. Watt, supra, 190 Cal. 155, 211 P. 17; Hellman v. Logan, 148 Cal. 58, 82 P. 848, and others cited, were decided upon the allegations of the complaint alone. There was no showing to the contrary of those allegations.
Notwithstanding the sufficiency of the complaint it may be shown by affidavits or otherwise that the resident defendant is not a real party in interest. Sourbis v. Rhoads, 50 Cal.App. 98, 194 P. 521. In Denna v. Red River Lumber Co., 47 Cal.App.2d 235, 117 P.2d 689, although the complaint stated a cause of action against the resident corporation defendant the court took testimony on the motion for change of venue and held that there actually was no cause of action against it and granted the change of venue.
In Hellman v. Logan, supra, 148 Cal. 58, 82 P. 848, cited by plaintiff, there was a direct allegation that the resident corporation defendant claimed an interest in the stock which it held and which was the security for a promissory note executed by the other defendant. The Supreme Court pointed out that the action was brought not only for judgment on the promissory note against its maker and to foreclose the security, but also to have the claim of the corporation adjudicated. As it was alleged to be making a claim to the stock itself, it was an indispensable party.
The President Lines' answer shows that they have no interest other than that of a stakeholder. The fact that it is asking that the successful party be required to pay its charges, and that it be allowed its costs, does not make it a real party in interest. There apply generally in all stakeholder cases. While it alleges in the answer that it has a possessory lien on the cable for its charges, it does not ask that such lien be established. It merely prays that upon determination of the party to whom the cable ought to be delivered, said party be ordered to pay President Lines its charges. This would follow without a court order. The allowance of costs would be merely incidental to its appearance as a stakeholder in the litigation and its offer to deposit the cable in court. It does not make the President Lines a real party in interest.
Plaintiff contends that in order to change the venue the court must find that plaintiff joined President Lines for the sole purpose of keeping the venue in the court where the suit was brought and that the court did not so find here. This contention has been answered in Modlin v. Walter's Fur Shop, 83 Cal.App.2d 384, at page 388, 188 P.2d 805, at page 807, where the court said: 'It may be true that the pleadings in this case were insufficient to permit an inquiry whether the allegations with respect to the resident defendant were sham, but such is not the only possible ground for disregarding the residence of a codefendant in determining the proper place for trial of the action * * *. Section 395 of the Code of Civil Procedure mentions as a separate and distinct ground: 'If any person is improperly joined as a defendant.' Such improper joining need not be intentional or fraudulent.'
While there are many instances in which the party in possession of property may have such a lien interest on it as to entitle him, in an action over the ownership and right to possession of it, to hold the venue in the county of his residence, the incidental character of President Lines' claim here distinguishes this case from such instances.
Even the possibility that a dispute might arise as to the amount of the charges is not sufficient to make the defendant a party in interest on the venue question. Such a dispute would be merely incidental to the main issue. The right to have the case tried in the county of his residence is a substantial right given a defendant and should not be taken away from one who has a real interest in the case merely because another who has only an incidental interest is joined as a defendant. The fact that the President Lines did not see fit to appeal from the order of transfer, indicates, to some extent, the mere incidentalness of their interest in the real issue, namely, the ownership of the cable.
The order is affirmed.
PETERS, P. J., and WARD, J., concur. --------------- * Subsequent opinion 221 P.2d 939. 1 (Hereafter referred to as 'Eastern') 2 (Hereafter referred to as 'Peterman') 3 (Hereafter referred to as 'President Lines') 4 At oral argument plaintiff conceded that President Lines could not claim attorney's fees. 5 All proceedings were had on the amended complaint, which will be referred to as the complaint.