Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_05-cv-01187/USCOURTS-caed-1_05-cv-01187-5/pdf.json

Parties Involved:
Clean Air Products, Inc.
Defendant
Darrin Simmons
Defendant
Thomas N. Smith
Plaintiff

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

THOMAS N. SMITH,

Plaintiff,

v.

DARRIN SIMMONS, dba CLEAN AIR

PRODUCTS, INC.,

Defendant.

1:05-CV-01187-OWW-NEW

MEMORANDUM DECISION AND ORDER

RE GRANTING DEFENDANT SIMMONS’

JUDGMENT ON THE PLEADINGS

(DOC. 42) 

1. INTRODUCTION

Defendant Darrin Simmons (“Simmons”) moves for judgment on

the pleadings pursuant to Federal Rules of Civil Procedure

12(b)(6), 12(c) and 12(h) against Plaintiff Thomas N. Smith

(“Smith” or “Plaintiff”). 

2. PROCEDURAL BACKGROUND

Plaintiff filed his complaint on September 19, 2005. (Doc.

1, Complaint.) Defendants filed a motion to dismiss on November

22, 2005. (Doc. 8, Motion to Dismiss I.) Plaintiff filed a

first amended complaint on February 9, 2006. (Doc. 11, First

Amended Complaint (“FAC”).) Defendants filed a motion to dismiss

the FAC on April 2, 2006. (Doc. 15, Motion to Dismiss II.) 

Plaintiff filed a second amended complaint on July 5, 2006. 

(Doc. 19, Second Amended Complaint (“SAC”).) Defendant filed a

motion to dismiss the third cause of action of Plaintiff’s SAC on

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July 25, 2006. (Doc. 20, Motion to Dismiss III.) Plaintiff

filed a statement of non-opposition to Defendants’ Motion to

Dismiss III. (Doc. 22, Non-opposition to Motion to Dismiss III.) 

An order was entered granting with prejudice Defendants’ Motion

to Dismiss III on September 15, 2006. (Doc. 25, Order on Motion

to Dismiss III.) Defendant filed an answer to Plaintiff’s SAC on

October 4, 2006. (Doc. 26, Answer to SAC.) Defendant Darrin

Simmons filed a motion for judgment on the pleadings on July 6,

2007. (Doc. 41, Motion for Judgment on the Pleadings.) Plaintiff

filed an opposition to the Motion for Judgment on the Pleadings

on July 20, 2007. (Doc. 54, Plaintiff’s Opposition.) Defendant

Simmons filed a reply to Plaintiff’s Opposition on July 30, 2007.

(Doc. 58, Defendant’s Reply.)

3.FACTUAL BACKGROUND

Plaintiff alleges two causes of action in his SAC against

Defendant Darrin Simmons, dba Clean Air Products, Inc., breach of

contract and common count. (Doc. 19, SAC, ¶¶ 9-18.) The title

caption to the SAC names Defendant as “DARRIN SIMMONS, dba CLEAN

AIR PRODUCTS, INC.” Plaintiff then names two Defendants in the

body of his SAC, “Defendant Darrin Simmons...” and “Defendant

Clean Air Products, Inc....” (Id., at p. 1.) Clean Air

Products, Inc. is alleged to be a corporation. (“Clean Air”) The

SAC does not specifically name Defendant Simmons as an

individual. 

A written agreement was entered into in 1998 between Land

O’Goshen, Inc. and Clean Air Products, Inc., a California

corporation with its principal place of business in Tulare County

(“1998 Agreement”). (Doc. 19, SAC, Exhibit 1, p. 1.) Under the

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terms of the 1998 Agreement, Land O’Goshen sold inventory from an

auction held by Help Smog Parts, including the 800 telephone, the

customer database, the operating systems and various other

business property and services. (Doc. 19, SAC, ¶ 9.) Plaintiff is

the sole owner of stock in Land O’Goshen and all rights in the

“agreement” were assigned to Plaintiff once the assets were sold

to Clean Air. (Id., at ¶ 11.) Plaintiff alleges “Defendant”

Clean Air failed to make all required payments under the

“agreement” when due. (Id., at ¶ 13.) Plaintiff contends he and

his predecessor in interest, Land O’Goshen performed all required

obligations under the “agreement.” (Id., at ¶ 12.) Plaintiff

contends that as a “result of the breach of agreement” he has

been damaged in the amount of $278,929. (Id., at ¶ 14.) 

The 1998 Agreement’s introductory paragraph states “This

Agreement is between Land O’Goshen, Inc., Seller and Clean Air

Products, Inc., buyer, dated November 23, 1998.” (Doc. 19, SAC,

Exhibit 1, p. 1.) The 1998 Agreement was signed by Plaintiff on

the line designated “Thomas N. Smith” and Defendant Simmons

signed on the line designated as “Darrin Simmons”. (Id. at p. 2.) 

Defendant Simmons signed his name and added his title “V.P.” next

to his signature. (Id.) 

Plaintiff incorporated the 1998 Agreement into the SAC: “The

terms of the agreement are set forth in Exhibit 1 which is

attached and incorporated herein.” (Doc. 19, SAC, ¶ 9.) Exhibit

1 contains not only the 1998 Agreement but an Agreement and

Contract of Sale, dated October, 2001, between Defendant Simmons,

as “President of Clean Air Products, Inc.” and Plaintiff. (“2001

Agreement”). (Id., at ¶ 16; and Exhibit 1, p.3.) Under the terms

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of 2001 Agreement Plaintiff was to prepare a business plan and

solicit prospective buyers to be referred to Defendant Simmons to

close the deals. If such a buyer was secured, the sales and

proceeds would be divided among “Plaintiff and Clean Air

Products, Inc.” based upon the terms set forth in the 2001

Agreement. (Doc. 19, SAC, Exhibit 1, p. 3.) The 2001 Agreement

is signed by Thomas N. Smith on a line designated “Thomas N.

Smith” and Defendant Simmons, on a line designated “Darrin K.

Simmons, President, Clean Air Products, Inc. dba Help Smog

Parts.” (Id.)

Plaintiff alleges in his first cause of action that

“Defendants” were to pay Land O’Goshen $430,000 in installments

as set forth in “Exhibit 1". (Doc. 19, SAC, ¶ 10.) Plaintiff

contends in his second cause of action that “Defendants” Clean

Air and Simmons owe Plaintiff the sum of $278,929. Plaintiff

contends he has performed as required. (Id., at ¶ 17.) Plaintiff

alleges “Defendants” owe him for goods, services and money

delivered within the past four years for which “Defendants”

agreed to pay a specified sum. There is a dispute over whether

Plaintiff’s allegations of Defendants’ failure to pay certain

sums of money under written agreements entered into in 1998,

include the 2001 Agreement (also attached as Exhibit 1 to the

SAC). Simmons contends no facts are pled or alleged under the

2001 Agreement in the SAC. (Doc. 58, Defendant’s Reply, p. 2:9-

13.) Plaintiff contends both agreements are part of the SAC. 

(Doc. 54, Plaintiff’s Opposition, p. 2:23-28.)

//

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4. STANDARD OF REVIEW

A. Standard of Review for a Motion for a Judgment on the

Pleadings

A Rule 12(c) motion challenges the legal sufficiency of the

opposing party's pleadings after the pleadings are closed. 

Judgment on the pleadings is appropriate when, even if all the

allegations in the pleading under attack are true, the moving

party is entitled to judgment as a matter of law. Fed. R. Civ. P.

12(c); Honey v. Distelrath, 195 F.3d 531, 532-33 (9th Cir. 1999). 

“For purposes of a motion for judgment on the pleadings, the

allegations of the non-moving party must be accepted as true,

while the allegations of the moving party which have been denied

are assumed to be false.” Hal Roach Studios v. Richard Feiner &

Co., 896 F.2d 1542, 1550 (9th Cir. 1990). 

I. Documents Attached to the Pleadings

Documents incorporated by reference to the complaint, are

considered part of the complaint, and not extrinsic evidence, and

therefore can be properly considered in a 12(c) motion for

judgment on the pleadings. Fed. R. Civ. P. 10(c); Voest-Alpine

Trading USA Corp. v. Bank of China, 142 F.3d 887, 891. fn. 4 (5th

Cir. 1998); Sira v. Morton, 380 F.3d 57, 67 (2nd Cir. 2004). The

documents attached pursuant to Fed. R. Civ. P. 10(c) will not be

considered outside the pleadings which would require converting

to a Rule 56 summary judgment motion. Id.; Fed. R. Civ. P. 12(c).

However, if documents attached to the complaint, contradict

allegations in the complaint, the court can refrain from

accepting the complaint allegations as true. Durning v. First

Boston Corp., 815 F.2d 1265, 1266 (9th Cir. 1987).

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5. DISCUSSION

A. First Cause of Action for Breach of Contract against Defendant

Simmons

Defendant Darrin Simmons moves for judgment on the pleadings

under Federal Rule of Civil Procedure 12(c) on Plaintiff’s first

cause of action for breach of contract. Under a breach of

contract claim, Plaintiff must allege a valid enforceable

contract for which Plaintiff has met all conditions precedent to

require Defendant Simmons’ counter-performance, and Defendant

Simmons breached the contract resulting in damages to Plaintiff.

Under 12(c) standards all material allegations of the plaintiff’s

complaint are accepted as true and inferences drawn against the

moving party. The moving party is entitled to judgment as a

matter of law only when the facts asserted do not constitute a

claim as a matter of law and there are no factual issues to be

tried. 

I. 1998 Agreement

Defendant Simmons argues that under the 1998 Agreement, the

only parties in privity to the contract are Land O’Goshen and

Clean Air, a corporation. (Doc. 42, Motion for Judgment on the

Pleadings, Points and Authorities (“Simmons P&A”), p. 4:12-14.) 

Defendant Darrin Simmons was vice-president of Clean Air at the

time the contract was executed, and claims he only executed the

contract on behalf of Clean Air in his capacity as vicepresident, not in his individual capacity. (Id., p. 4:15-18.)

Generally, directors and officers will not be liable in their

individual capacity for contracts of the corporation. Am.Jur.2d

Corporations § 1341. Simmons asserts that Clean Air alone

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obligated itself to pay Land O’Goshen the disputed sum, and

therefore only Clean Air could have breached the 1998 Agreement.

(Doc. 42, Motion for Judgment on the Pleadings, Simmons P&A, p.

4:25-26, p. 5:1-3.) 

The four corners and express language of the 1998 Agreement,

attached to Plaintiff’s SAC and considered part of the SAC,

support Defendant Simmons’ claims. California Civil Code § 1638

governing interpretation of the language of a contract states:

“The language of a contract is to govern its interpretation, if

the language is clear and explicit, and does not involve an

absurdity.” West’s Ann. Cal. Civ. Code § 1638. The introductory

paragraph in the 1998 Agreement clearly identifies the parties to

the contract: “This Agreement is between Land O’Goshen, Inc.,

Seller and Clean Air Products, Inc., buyer...” (Doc. 19, SAC,

Exhibit 1, p. 1.) The second paragraph of the 1998 Agreement

describing the business transaction also states, “Land O’Goshen,

Inc. desires to sell, and Clean Air Products, Inc. desires to

purchase...” (Id.) Nowhere in the body of the agreement, does

Defendant Simmons’ name appear, except for the signatory line. 

The California Uniform Commercial Code provides: 

(b) If a representative signs the name of the

representative to an instrument and the signature is an

authorized signature of the represented person, the

following rules apply: 

(1) If the form of the signature shows unambiguously that

the signature is made on behalf of the represented person

who is identified in the instrument, the representative

is not liable on the instrument.

(2) Subject to subdivision (c), if (A) the form of the

signature does not show unambiguously that the signature

is made in a representative capacity or (B) the

represented person is not identified in the instrument,

the representative is liable on the instrument to a

holder in due course that took the instrument without

notice that the representative was not intended to be

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liable on the instrument. With respect to any other

person, the representative is liable on the instrument

unless the representative proves that the original

parties did not intend the representative to be liable on

the instrument.

West’s Ann. Cal. Com. Code § 3402(b).

Defendant Simmons is never identified as a party who will

perform the contract, nor is he obligated in anyway under the

contract. Although, the typed signatory line includes only the

name Darrin Simmons, without any reference to the Clean Air

corporation or the representative capacity for Clean Air in which

he signed; Defendant Simmons signed his name and added his

representative function and capacity of “V.P.” next to his

signature, foreclosing any doubt that Simmons signed in his

representative, not personal capacity, of vice-president. (Doc.

19, SAC, Exhibit 1, p. 2.) Further, Plaintiff does not assert

under what theory of liability Defendant Simmons in his

individual capacity is sued on the contract. He is not a named

party to the 1998 Agreement and did not sign it in his individual

capacity. There is no mention of an alter ego theory or piercing

the corporate veil. Therefore, Defendant Simmons cannot be a

proper party to Plaintiff’s breach of contract cause of action

under the 1998 Agreement. The facts upon which the Plaintiff's

SAC is based, even if assumed to be true, do not include a claim

against Defendant Simmons under the 1998 Agreement under any

theory of personal liability. 

II. 2001 Agreement

Defendant asserts that the 2001 Agreement, also attached as

Exhibit 1 to Plaintiff’s SAC, is not pled in the SAC, nor are any

facts set forth referring to a breach of contract under the 2001

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Agreement. (Doc. 58, Defendant’s Reply, p. 2:9-13.) A breach of

contract cause of action requires the Plaintiff to identify the

contract in dispute. Plaintiff describes parties entering into a

series of written agreements in 1998, but does not refer to the

parties entering into any agreements in 2001. (Doc. 19, SAC, ¶

9.) 

It cannot be determined from the facts pled if Plaintiff

includes the 2001 Agreement in his reference to the “1998

Agreements.” A review of the four corners of the SAC includes

the 2001 Agreement, as it is attached as an exhibit to the SAC. 

However, there are no allegations pled identifying the

contracting parties under the 2001 Agreement nor that the

contract was breached. Plaintiff only states “In 1998, Land

O’Goshen, Inc. entered into a series of written agreements with

Defendants.” There is no mention of a 2001 Agreement. (Id.) 

Further, Plaintiff lists in his first cause of action various

business property and services that Land O’Goshen sold under the

“written agreements,” (“800 telephone number of Help Smog Parts,”

“The Customer data base,” “One Toyota Forklift serial #4U-3FGEZU61890.") that mirror the business property and services described

in the 1998 Agreement. (Doc. 19, SAC, ¶ 9.) The 2001 Agreement,

executed three years later, is a different agreement requiring

Plaintiff to prepare a business plan and solicit prospective

buyers to be referred to Simmons with Plaintiff receiving a

portion of profits if Clean Air closes a deal with the buyer. 

Additionally, the sum of money Plaintiff claims in his SAC that

“Defendants” were to pay in installments amounted to $430,000,

the exact amount specified in the 1998 Agreement. See Doc. 19, ¶

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The Ninth Circuit in Sidebotham v. Robison, 216 F.2d 816, 827 Fn.4 (9th 1

Cir. 1955), noted that a common count under California met the minimum

requirements of Rule 8(a) of the Federal Rules of Civil Procedure, 28 U.S.C.

10

9 and Exhibit 1, p. 1. Therefore, all facts pled point to a

claim under the 1998 Agreement only. 

The motion for judgment on the pleadings as the first cause

of action is GRANTED WITH LEAVE TO AMEND.

B. Second Cause of Action for Common Count against Defendant

Simmons

Defendant Simmons moves for judgment on the pleadings

regarding the common count cause of action against him in his

individual capacity. Under California law, which recognizes

common counts , “[a] common count is proper whenever the plaintiff 1

claims a sum of money due, either as an indebtedness in a sum

certain, or for the reasonable value of services, goods, etc.,

furnished. It makes no difference in such a case that the proof

shows the original transaction to be an express contract, a

contract implied in fact, or a quasi-contract.” Kawasho

Internat., U.S.A. Inc. v. Lakewood Pipe Service, Inc., 152

Cal.App.3d 785, 794 (1983)(quoting 3 Witkin, California

Procedure, 2d edition, p. 2085, Pleading § 423.). However, “[a]

common count is not a specific cause of action...rather, it is a

simplified form of pleading normally used to aver the existence

of various forms of monetary indebtedness, including that arising

from an alleged duty to make restitution under an assumpsit

theory.” McBride v. Boughton, 123 Cal.App.4th 379, 394 (2004). 

For an express contract that is no longer executory, a common

count pleading is appropriate when the only remaining obligation

is the payment of money by defendant. Ferro v. Citizens Nat.

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Trust & Sav. Bank, 44 Cal.2d 401, 409 (1955); McBride v.

Boughton, 123 Cal.App.4th at 394-395. “The only essential

allegations of a common count are ‘(1) the statement of

indebtedness in a certain sum, (2) the consideration, i.e., goods

sold, work done, etc., and (3) nonpayment.’” Farmers Ins.

Exchange v. Zerin, 53 Cal.App.4th 445, 460 (1997)(quoting 4

Witkin, Cal. Procedure (3d ed. 1985) Pleading, § 508, p. 543);

see also Miniace v. Pacific Maritime Ass'n, 424 F.Supp.2d 1168,

1186 (N.D. Cal. 2006). “A cause of action for money had and

received is stated if it is alleged the defendant ‘is indebted to

the plaintiff in a certain sum for money had and received by the

defendant for the use of the plaintiff.’” Farmers Ins. Exchange,

53 Cal.App.4th at 460 (quoting Schultz v. Harney, 27 Cal.App.4th

1161, 1623 (1994)).

In Plaintiff’s common count cause of action, he asserts

“Defendants” have failed to pay the sum of $278,929 for goods,

services and money delivered to “Defendants” for which

“Defendants” agreed to pay. (Doc. 19, SAC, ¶¶ 16, 18.) Such

alleged facts alone are sufficient for a common count allegation.

However, the second cause of action also incorporates the

first cause of action allegations. (Id., at ¶ 15.) “[I]f

plaintiff is not entitled to recover under one count in a

complaint where all the facts upon which his demand is based are

specifically pleaded, it is proper to sustain a demurrer to a

common count set forth in the complaint, the recovery under which

is obviously based on the set of facts specifically pleaded in

the other count.” Hays v. Temple, 23 Cal.App.2d 690, 695 (1937);

Lambert v. Southern Counties Gas Co., 52 Cal.2d 347, 353 (1959);

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Orloff v. Metropolitan Trust Co., 17 Cal.2d 484, 489 (1941).

Demurrers are based on the same principles as motions for

judgment on the pleadings in that all material facts presented in

complaint and any inferences or deductions are deemed true for

purposes of review, the question for the court is whether based

on the facts set forth in the complaint, there is no recovery

possible under the law and any doubt should be resolved in favor

of denying the motion. The first cause of action does not

sufficiently allege a cause of action for breach of contract

under the 1998 Agreement nor the 2001 Agreement against Defendant

Simmons in his individual capacity. Plaintiff cannot under this

state of the pleadings, sustain his second claim for money had

and received against Defendant Simmons, because the claim is

based on the exact set of facts and circumstances specifically

pleaded in the first cause of action for breach of contract.

The motion for judgment on the pleadings as to the second

cause of action is GRANTED WITH LEAVE TO AMEND.

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CONCLUSION

Defendant’s motion for judgment on the pleadings pursuant to

Fed. R. Civ. P. 12(c) is GRANTED WITH LEAVE TO AMEND. Any

amended complaint shall be filed within twenty (20) days

following date of service of this decision by the clerk of the

court.

IT IS SO ORDERED.

Bb4edDated: September 24, 2007 /s/ Oliver W. Wanger 

UNITED STATES DISTRICT JUDGE

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