California Bank & Trust v. AM/PM Enterprises Inc., et al.
Published: Mar. 23, 2002 | Result Date: Sep. 20, 2001 | Filing Date: Jan. 1, 1900 |Case number: KC034749 Bench Decision – $0
Facts
Cross-defendant Dunbar Armored Inc. is in the armored transport business. Cross complainant AM/PM owned
two convenience stores in Los Angeles County. In 1998, Dunbar entered into two service contracts with
AM/PM, one for each store. In deposition, AM/PMÆs president, Mohamad Baba admitted that he had read
both contracts before signing them, signed them voluntarily, and agreed that they remained in force during the
relevant period.
The contracts provided that Dunbar would pick up deposits from the AM/PM store every weekday and
transport them to a facility in Venice, which was operated by cross-defendant Brinks Inc. Then Brinks would
send the deposits to AM/PMÆs bank, plaintiff and cross-defendant California Bank & Trust (CBT). Six of these
deposits were collected by Dunbar between October 1999 and January 2000, and were credited to AM/PMÆs
account. AM/PM subsequently withdrew these funds from its account.
However, in June 2000, CBT discovered that they had no record of receiving these deposits. In the main action,
CBT sued AM/PM, alleging that as a result of its own internal errors, it credited AM/PMÆs accounts with
deposits that allegedly never arrived at Brinks. CBT did not sue Dunbar in the main action.
AM/PM cross-complained against Dunbar, Brinks and CBT alleging breach of contract and conversion.
However, the contracts required AM/PM to give written notice of the claim to Dunbar within 30 days of the
date when Dunbar collected the deposits. AM/PM did not notify Dunbar until June 2000 that the six deposits
may be missing. Even though AM/PM informed Dunbar as soon as it had been informed about the missing
deposits by CBT, this was more than 30 days after the dates when the deposits had been collected by Dunbar,
and therefore AM/PM breached the contracts.
Accordingly, the court granted summary adjudication to Dunbar as to these six deposits. The court denied
summary judgment because it found a dispute of material fact as to whether AM/PM gave timely notice of the
claim to Dunbar about the other missing deposits that had been collected by Dunbar in May 2000, i.e., within
the 30 day notice period.
Cross-complainant AM/PM argued that it had acted promptly and informed Dunbar about the missing deposits
as soon as it learned about them. Therefore, the contractual provisions requiring it to give written notice within
30 days should not be enforced.
Cross-defendant Dunbar argued that it is a high volume carrier that must receive prompt
notice of potential claims in order to find the relevant paperwork and investigate the claim.
Though the delay may not have been AM/PMÆs fault, Dunbar contended that it was prejudiced by
the delay because it lost the opportunity to promptly investigate, and could not find the
documents that would have proved that it delivered these deposits to Brinks. Therefore, it moved
for summary judgment and summary adjudication.
Other Information
The court granted cross-defendant DunbarÆs motion for summary adjudication, thereby eliminating claims worth $96,334 out of a total claimed by AM/PM of $120,000. The case subsequently settled at mediation.
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