Golden State Co. v. Superior Court ( 1938 )

WOOD, J.

Petitioners have applied for a writ of mandate commanding respondent superior court to order John H. Chamness to give his deposition.

Richmaid Creameries, Incorporated, were engaged in the business of processing milk and distributing butter and cheese on and prior to August 1, 1936. At that time a strike was threatened by the employees of Richmaid Creameries and, according to the allegations of the complaint hereinafter referred to, an agreement was made by Richmaid Creameries and the petitioners herein whereby it was agreed that if Richmaid Creameries would not accede to the demands of the “Union” the petitioners would refrain from soliciting or servicing any of the customers of Richmaid Creameries and would do certain things to assist Richmaid Creameries in conducting its business. • Thereafter a strike was called against Richmaid Creameries. John H. Chamness was the manager of Richmaid Creameries and as such conducted the negotiations which resulted in the making of the agreement with the petitioners. Richmaid Creameries, on September 6, 1936, filed a petition in the United States District Court for relief under section 77B of the Bankruptcy Act. An order was made by the court directing the liquidation of Richmaid Creameries and Chamness was appointed temporary trustee. On January 22, 1937, at a meeting of the creditors, L. Boteler was elected the trustee in bankruptcy.

An action was commenced in the superior court by L. Boteler as trustee of Richmaid Creameries against the petitioners herein on August 3, 1937, in which a large sum is sought to be recovered against the petitioners for damages for the breach of the alleged agreement concerning the threatened strike. The complaint bears verification under date of July 23, 1937, by John H. Chamness in which he stated that “he was the managing officer of the Richmaid Creameries, Inc., of whose estate the plaintiff herein is Trustee in Bankruptcy; that the facts alleged in the herein complaint are within the knowledge of affiant having occurred while affiant was said managing officer and therefore makes this affidavit in place of plaintiff herein”.

The petitioners herein, defendants in the action commenced by L. Boteler as trustee in bankruptcy, filed answers and sought to take the deposition of Chamness. The parties to the action stipulated that the deposition might be taken but upon the refusal of Chamness to voluntarily appear an affidavit was filed on behalf of the petitioners in the superior court and a subpoena was issued directing Chamness to . appear before a notary public to give Ms deposition. Chamness appeared before the notary but refused to give his deposition on the ground that at the time of the filing of the complaint and ever since he had not been an officer or manager of Kiichmaid Creameries. Thereupon the petitioners sought an order from the superior court directing Chamness to give his deposition but the superior court refused to make such order.

It is provided in section 2021, subdivision 1, of the Code of Civil Procedure that the testimony of a witness may be taken by deposition "when the witness is a party to the action or proceeding or an officer, member, agent, or employee of a corporation, . . . ”. It is the contention of the respondent that since the wording of the statute is in the present tense, the witness, being no longer manager of the corporation, cannot be compelled to give his deposition. To pass upon this contention we should consider the purposes for which the statute was enacted. It was undoubtedly the intention of the legislature to afford the parties to the litigation means of obtaining in advance of the trial information concerning the issues so that they might properly prepare for trial and avoid being taken by surprise by unexpected contentions. The purposes of the enactment would be defeated if a corporation litigant should be permitted to remove its officers or employees during the pendency of litigation and thus enable them to refuse to give depositions. In some situations such action would give an undue advantage to a corporation, especially if an individual were the opposing litigant. It has been held that an officer of a corporation may not resign or be removed for the purpose of preventing service upon such officer of process directed against the corporation. (Inventions Corp. v. Hobbs, 244 Fed. 430 [157 C. C. A. 56]; Evarts v. Killingworth Manufacturing Co., 20 Conn. 447.) In Zellerbach v. Superior Court, 3 Cal. App. (2d) 49 [39 Pac. (2d) 252], it is stated that "the code sections relating to the taking of depositions should be liberally construed”, citing Pollak v. Superior Court, 197 Cal. 389, 393 [240 Pac. 1006].

The unusual facts of the present litigation give especial force to the petitioners’ application. The cause of action alleged by Biehmaid Creameries arose from an uncommon situation. The oral agreement negotiated by Chamness on behalf of Biehmaid Creameries with a number of defendants was novel and difficult of execution. Manifestly, if the defendants in the action commenced on behalf of Biehmaid Creameries are to receive the benefits of the section of the code in question they can do so only by taking the deposition of Chamness. He was in charge of the affairs of the corporation during all of the time covered by the litigation and remained in charge for a period after the commencement of the bankruptcy proceedings. After the appointment of the permanent trustee he was considered the proper party to verify the complaint. It is apparent that the legislature intended to provide for the taking of a deposition in a situation such as is here presented. To hold otherwise would be to deny to the petitioners a privilege which is accorded to others.

It is ordered that the peremptory writ issue.

Crail, P. J., concurred.