Unpublished Disposition, 878 F.2d 1438 (9th Cir. 1983)

MEMORANDUM^* 

OVERVIEW

After a bench trial, David Martinez (Martinez) appeals the district court's decision that Fernando Gonzalez (Gonzalez) and Floriza Sales Company, Inc. (Floriza) were not liable for the personal injury which Martinez suffered.¹  We have jurisdiction under 28 U.S.C. 1291 and we affirm in part and remand this case for further proceedings.

BACKGROUND

On April 1, 1983, Martinez, a citizen of California drove his truck to the Floriza Produce warehouse in Nogales, Arizona to pick up some eggplants. After positioning his truck at the loading dock, Martinez went inside the trailer of his truck to restack some produce he had picked up earlier. A Mexican truck driven by Mario G.P.E. Ramirez Lopez (Lopez) hit Martinez' truck while Martinez was in the trailer, allegedly injuring him. The truck driven by Lopez was owned by a Mexican company called Sociedad de Produccion Rural Inda, AKA S.P.R.I.A. (SPRIA), and Martinez alleges that Lopez was employed by SPRIA. Martinez asserted that Floriza was liable under three tort theories: 1) as a joint venturer with SPRIA; 2) under the peculiar risk doctrine; and 3) premises liability.

DISCUSSION

Because federal jurisdiction is based on diversity and this suit was filed in California, this court ordinarily would apply California's choice of law rules to determine which substantive law to apply. See Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487 (1941). In this case, however, the parties stipulated that California law would apply, consequently we apply California's law of torts.

Martinez argues that the district court erred by finding that Floriza was not engaged in a joint venture with SPRIA in 1983 when Martinez was injured at the Floriza warehouse. The determination of whether two parties are joint venturers is primarily a factual question. Nelson v. Abraham, 29 Cal.2d. 745, 750, 177 P.2d 931, 933-34 (1947); Bank of California v. Connolly, 36 Cal.App.3d. 350, 364, 111 Cal. Rptr. 468, 478 (1973). Therefore, we review the district court's finding on this issue under the clearly erroneous standard. See Cooling Systems and Flexibles, Inc. v Stuart Radiator, 777 F.2d 485, 487 (9th Cir. 1985) (we review a district court's findings of fact after a bench trial for clear error).

California law recognizes a joint venture relationship when the parties: 1) agree to engage in a common business undertaking; 2) have an understanding as to the sharing of profits and losses and; 3) have a right of joint control. Connolly, 36 Cal.App.3d. at 364, 111 Cal.Rptr. at 477-78; see Mariposa County v. Yosemite West Assocs., 202 Cal. App. 3d 791, 813-814, 248 Cal. Rptr. 778, 792 (1988). A joint venture agreement may be implied from the acts and declarations of the parties. Holtz v. United Plumbing & Heating Co., 49 Cal. 2d 501, 506-507, 319 P.2d 617, 620 (1957).

Martinez argues that Floriza and SPRIA were joint venturers because they had an agreement to share profits and losses and a right of joint control which was illustrated by evidence that Floriza obtained automobile insurance for SPRIA trucks and by evidence that the Gonzalez family operated both SPRIA and Floriza.

The district court did not clearly err by finding that a joint venture did not exist. Nothing in the record indicates that SPRIA and Floriza intended to share profits and losses. The district court found that Floriza's practice of obtaining insurance for SPRIA trucks merely facilitated produce delivery to the United States from Mexican farms and that the cost of the insurance would be deducted from the price Floriza would pay SPRIA for produce upon delivery.

Martinez relies on the fact that Hector Gonzalez was the president of SPRIA in 1983 and is the current president of Floriza, to establish that the Gonzalez family had a right of joint control over both companies. We need not decide this element of joint venture, however, because the district court did not err in finding that Floriza and SPRIA did not engage in a common business undertaking to share profits and losses. See Holtz, at 506-507; see also 6 B. Witkin, Summary of California Law, Sec. 17 (1974) (the sharing of profits and losses in a common enterprise is an essential element of joint venture).

Consequently, in the absence of a showing that Floriza and SPRIA were associated in a common business undertaking to share profits and losses, we conclude that the district court did not clearly err in finding that a joint venture did not exist.

Martinez contends that the district court erred by finding that Floriza was not liable under the peculiar risk doctrine. Ordinarily, an employer is not liable for the torts of an independent contractor. See, e.g., Castro v. State, 114 Cal. App. 3d 503, 509-510, 170 Cal. Rptr. 734, 738 (1981). The peculiar risk doctrine, however, provides that an employer may be liable for the negligence of an independent contractor when the work that the independent contractor performs is " 'likely to create ... a peculiar risk of physical harm to others unless special precautions are taken....' " Id. at 510 (quoting Restatement (Second) of Torts Sec. 416 (1965)).

There is no evidence that Floriza employed Lopez in any capacity, consequently Martinez' argument depends on a finding that Floriza and SPRIA were joint venturers and that SPRIA employed Lopez as an independent contractor. Since we affirm the district court's finding that Floriza and SPRIA were not engaged in a joint venture, Martinez' peculiar risk argument fails.

Martinez argues that the district court erred by not considering whether Floriza is liable to Martinez under the theory of premises liability. A landowner may be liable under premises liability for injuries resulting from the landowner's failure to exercise ordinary care to keep the premises in a safe condition. See Swanberg v. O'Mectin, 157 Cal.App.3d. 325, 330, 203 Cal. Rptr. 701, 704 (1984); see also Rowland v. Christian, 69 Cal.2d. 108, 119, 443 P.2d 561, 568, 70 Cal. Rptr. 97, 104 (1968). There is no indication in the record that the district court made any findings of fact or conclusions of law on this issue. Ordinarily, this court will not decide an issue that was not addressed by the district court. See, e.g., Andersen v. Cumming, 827 F.2d 1303, 1305 (9th Cir. 1987). The record indicates that Martinez argued the theory of premises liability to the district court, and therefore did not waive this theory of recovery. Accordingly, we remand to the district court the issue of whether Floriza is liable to Martinez under the theory of premises liability.

AFFIRMED in part and REMANDED in part.