Crouch v. Gilmore Oil Co., Ltd.

THOMPSON, J.

Four cases were brought against defendants for damages arising out of an automobile collision. They were consolidated, and after plaintiffs had rested their ease the defendant Gilmore Oil Company, Ltd., a corporation, to which we may hereafter refer as the Gilmore Oil Company, made a motion for a nonsuit, which was granted. The case proceeded to judgment as between the rémaining parties. The plaintiffs, however, prosecute this appeal from the judgment of nonsuit.

The individual defendants and representatives of the defendant corporation were examined by plaintiffs under section 2055 of the Code of Civil Procedure, with the apparent object of establishing that the defendant H. D. Shaw was an employee of the Gilmore Oil Company and acting within the scope of his employment at the time of the accident.

As the result of such examination, with its attendant cross-examination, the following essential facts were developed: The defendant Smith was the principal owner of the “Smith Tank Line Company”, owning 25 or 30 trucks and engaged in the business of trucking gasoline as a common carrier. The Gilmore Oil Company was engaged in the production and sale of gasoline and oil. During the month of May, 1931, the defendant Smith, doing business under the name of Owens Valley Oil Company, and the Gilmore Oil Company entered into an agreement whereby the company was to sell Smith gasoline at their San Fernando bulk plant at their regular price, for the purpose of resale by Smith in a specified district north of Saugus and including the Owens valley. The defendant corporation was only supplying one customer in the granted district at the time, which customer was thereafter supplied by the Owens Valley Oil Company. For the purpose of carrying out the contract and of selling gasoline and oils, Smith purchased the truck involved in the accident. We may parenthetically remark that the truck was different in construction from any of those owned and operated by the Gilmore Oil Company. At Smith’s request, the defendant corporation painted the truck in the colors used by it and about 4,500 service station operators on the Pacific Coast

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selling its products, and on the sides painted the word “Gilmore” and on the rear its advertising “insignia”, the lion’s head. However, on the door of each side of the cab of the truck were painted the words “Owens Valley Oil Company”. The defendant corporation sold Smith gasoline to operate his truck at one cent below its regular price. The defendant Shaw had been employed by Smith as a truck driver in his operation of the Smith Tank Line Company. Smith placed him in charge of the gasoline truck, with instructions to sell the gasoline and to that end to solicit regular business throughout the territory. At all times here involved Shaw’s salary was paid by Smith, and the latter told Shaw “what to do”. Actual operations started about May 20, 1931, at which time Shaw told a representative of the Gilmore Oil Company that they had no sales slips printed, and secured from him a pad of sales slips, contract forms for service stations and conditional sales forms for pumps. At the time and at his request, Shaw was informed and instructed, when filling out such slips or forms, to scratch out the name Gilmore Oil Company, Ltd., and in place thereof insert the name “Owens Valley Oil Company”. Sales slips for the Owens Valley Oil Company were ordered and received about the first of June. Thereafter they were used exclusively. However, the suggested procedure was not followed with the borrowed forms in two sales slips, one conditional contract for one pump and in one place on one copy of a service station contract. The pump, however, was in no way connected with the Gilmore Oil Company, but was purchased by Smith from another concern. The service station contract with the purchaser of this particular pump discloses that Shaw did strike out the name of Gilmore Oil Company and substitute the . Owens Valley Oil Company. It also appears that Shaw consulted a Mr. Boyd, with the Gilmore Oil Company, concerning the attitude of the major companies as to price cutting, and also asked him how “to go about” refusing to sell gas to a station where the contract provided that it might be terminated by a 24-hour notice. Evidence was adduced that prior to the agreement with Smith, the Gilmore Oil Company had refused to sell gas in tank lots to an operator of a station in the territory subsequently assigned to Smith, giving as its reason a rule that gas would not be sold at the refinery, nor