Papenfus v. Webb Products Co.

California Court of Appeal Dec 20, 1941 No. Civ. 2945Published

Before: Marks

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Holding. The court held that a plaintiff who unsuccessfully pursues a remedy that was never actually available to them is not barred by the doctrine of election of remedies from subsequently pursuing a different, valid remedy.

Issues

Whether a prior unsuccessful attempt to rescind a contract precludes a subsequent action for different relief when the remedy of rescission was not legally available to the plaintiff.

Disposition. reversed

Quotations verified verbatim against the opinion

“It is, however, equally true that, where a party makes a mistake in election of remedies, he is not estopped by his abortive election from subsequently resorting to and pursuing a remedy to which he was really entitled.”

“As he mistook his remedy in his former action the doctrine of election of remedies cannot bar this action.”

MARKS, J.

Plaintiff brought this action for declaratory relief and to declare a trust in his favor in the assets of the Webb Products Company. Defendants had judgment and this appeal followed.

The controversy has been here before (see

Papenfus

Webb Products Co., Inc.,

24 Cal. App. (2d) 559 [75 Pac. (2d) 631]) in another case in which different issues were presented. Reference is made to the former opinion for a statement of those facts which are not repeated here.

The judgment in the present case is based on the theory that plaintiff elected his remedy in the former action and is precluded from maintaining this action by the judgment then rendered. This is the sole question which we must consider on this appeal.

In the former action plaintiff sought rescission of a contract between himself and defendants and a return to him of the assets he had transferred to the Webb Products Company, Inc., under the terms of the contract executed in 1931. These assets were principally good will of his business, a trade name which was copyrighted, stock in trade, consisting largely of materials used in the manufacture of products, and secret formulas for the manufacture of those products.

Judgment was rendered against plaintiff in that ease on the ground that rescission was a remedy not available to

[633]

him for two reasons: (1) His former assets had been so intermingled with assets of Webb Products Company, Inc., that they could not be segregated and returned, the stock in trade had been used up and the secret formulas had become known to others and were no longer secret. (2) He was estopped by his conduct to demand a rescission.

Under well settled rules of law a person cannot rescind a contract when confronted with those facts.

(Papenfus

Webb Products Co., supra.)

Papenfus v. Webb Products Co.

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MARKS, J.

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