Brunzell Construction Co. v. Barton Developmnet Co.

DRAPER, P. J.

Demurrer to plaintiff’s complaint was sustained without leave to amend. Judgment of dismissal followed, and plaintiff appeals.

Plaintiff is a Nevada corporation. It has never been licensed as a contractor in California, but its sole shareholder and responsible managing officer is individually licensed in this state as a general contractor. He is also the sole shareholder and responsible managing officer of Everett S. M. Brunzell Corp., a California corporation which is licensed. On August 10, 1960, plaintiff corporation and defendant entered into a written contract, under which plaintiff was to construct an apartment house upon property owned by defendant for a price not to exceed $1,450,000. Not less than $1,000,000 was to be paid to plaintiff contractor in cash, and the remainder by promissory notes of defendant. Upon completion of the building and its acceptance by defendant (but not until then) the parties were to form a joint venture to own and operate it. Part of plaintiff’s capital contribution to the joint venture would be the surrender of its notes.

On November 9, 1960, three months after the contract was signed, and before any construction had begun, defendant sold

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the land, but did not advise plaintiff of the sale until December 7. Although the first two counts of the complaint allege that plaintiff “expended the efforts of highly trained . . . personnel in performing its duties under said contract,” its brief insists that these counts do not “allege performance under the contract.” In any event, it is clear that they seek damages of $2,107,500 for anticipatory breach, including profit which would have been realized had construction commenced and been completed, and the value of the share which plaintiff would have had in the joint venture had it been formed. The third cause alleges fraud in the concealment from plaintiff of defendant’s negotiations for sale to another, and seeks $6,000 for costs incurred “in the work of performing said contract” between August 10 and December 7.

“It is unlawful for any person to engage in the business or act in the capacity of a contractor . . . without having a license therefor” (Bus. & Prof. Code, § 7028). A contractor is “any person who undertakes to or offers to undertake to or purports to have the capacity to undertake to or submits a bid to, . . . construct . . . any building” (Bus. & Prof. Code, § 7026). “No person engaged in the business or acting in the capacity of a contractor, may bring or maintain any action in any court of this State for the collection of compensation for the performance of any act or contract for which a license is required by this chapter without alleging and proving that he was a duly licensed contractor at all times during the performance of such act or contract” (Bus. & Prof. Code, § 7031, as it stood in 1960, Stats. 1957, ch. 845, p. 2067). The complaint here admits that plaintiff was never licensed.