Williams v. Spence

WHITE, P. J. Defendant Claude Spence appeals from a judgment declaring the rights of the parties in certain funds then held and later to be collected by cross-defendant Quality Films, Inc., under a contract for the distribution of a certain motion picture.

By appellant’s cross-complaint he alleges a controversy existing between respondent and appellant as to the ownership of the picture and of the distribution contract and seeks a declaration of such rights, and particularly a declaration that appellant is the owner of the film and rights to the proceeds of the distribution contract by virtue of an assignment executed by respondent.

It is conceded by all parties that Quality Films, Inc., is a mere stakeholder awaiting adjudication of the rights of appellant and respondent. The distribution contract is a mimeographed form letter addressed to Quality Films, Inc., dated December 12, 1951, signed by Claude S. Spence and Sydney M. Williams and accepted and approved for Quality Films, Inc., by Charles Weintraub, its president. By the terms of that letter agreement, there appears no difference between appellant and respondent. Each agrees that Quality Films is to distribute the picture, collect the revenue, retain 20 per cent of the gross proceeds, and “remit to the undersigned the total proceeds” less 20 per cent. Each agrees to supply prints, reels and shipping eases. Each “warrants and represents” that he “has the right to enter into this agreement . . . and that such telecasting will not violate the rights of others. ...”

[605]Appellant contends that respondent “was present at the negotiation conferences with Quality Filins as his attorney; was acting in that capacity at the time he signed said contract, and failed to inform defendant (appellant) of any claim to the motion picture or proceeds of distribution.” The court found upon substantial evidence that “It is true that plaintiff Sydney M. Williams is, and for some years has been, an attorney licensed to practice in the State of California, and pursuant to said license has so practiced. It is not true that plaintiff Sydney M. Williams acted as an attorney for the defendant Claude S. Spence in relation to any matters which are the subject of this litigation.”

Respondent was the producer and first owner of the picture. By the terms of a letter agreement between appellant and respondent dated July 12, 1944, and signed by both, appellant loaned $25,000 to respondent to be repaid “solely from the so-called producers’ share of the gross receipts of the picture . . . prior to the repayment to myself (respondent) from the receipts of said picture of all sums which I may have invested or advanced . . . You (appellant) acknowledge that I may repay from the receipts of the picture other production loans prior to the repayment of your loan ... As compensation to you for the making of said loan, I agree that you shall be paid the following: (a) ... the sum of $28,750.00 instead of the sum of $25,000.00; (b) a sum equal to 15% of the profits to be received by me from the distribution of the picture. The term ‘profits’ as used herein shall mean the amount by which the moneys paid by Republic Pictures Corporation . . . exceeds the total cost of production of the picture ...” A check from respondent to appellant, dated March 15, 1946, for $4,450 bears the following endorsement signed by appellant: “Payment en re: The Big Show Off including $3,750.00 interest as per agreement, balance due $22,600.00 to be paid as per agreement only as follows: 50% of proceeds of producers’ share until such sum of $22,600 is paid in full. Thereafter, when, as, and if, the said producers’ share shall have reached the sum of $150,000 said Claude S. Spence is entitled to receive 15% of any and all further receipts of said producer’s share of the Big Show Off.”