Unpublished Disposition, 920 F.2d 936 (9th Cir. 1988)

MEMORANDUM^* 

This diversity action arose out of the purchases of stone and marble products by Defendant-Appellant Flexsol Marble, Stone & Granite, Inc. ("Flexsol"), a California corporation, from the exporter Plaintiff-Appellee General Batiments Industriels ("GBI"), a French corporation, during 1985 and 1986. Flexsol challenges the district court's determination, after a bench trial, that Flexsol made a claim for an account stated with GBI. Because we conclude the parties never reached agreement on a total amount due, we reverse.

Under California law, " [a]n account stated is an agreement, based on the prior transactions between the parties, that the items of the account are true and that the balance struck is due and owing from one party to another." Gleason v. Klamer, 163 Cal. Rptr. 483, 485 (Cal.Ct.App.1980); see generally 1 B.E. Witkin, Summary of California Law Secs. 917-20, at 820-22 (9th ed. 1987). Since an account stated establishes a new contract, see, e.g., Gleason, 163 Cal. Rptr. at 485, review is analogous to interpretation of a contract, which presents a mixed question of law and fact. See, e.g., Miller v. Safeco Title Ins. Co., 758 F.2d 364, 367 (9th Cir. 1985). In considering contractual language and the application of contract construction principles, review is de novo. Id. District court findings concerning extrinsic evidence of related facts are instead reviewed for clear error. Id.

We conclude no account stated was established because final agreement was not reached on a total sum certain. See, e.g., H. Russell Taylor's Fire Prevention Serv., Inc. v. Coca Cola Bottling Corp., 160 Cal. Rptr. 411, 421 (Cal.Ct.App.1979) ("It is elementary law that a claim must be reduced to a definite amount by agreement between the parties before it can form a legitimate portion of an account stated.") (emphasis in original); Zinn v. Fred R. Bright Co., 76 Cal. Rptr. 663, 665 (Cal.Ct.App.1969) (noting a requisite element of an account stated is "an agreement between the parties, express or implied, on the amount due from the debtor to the creditor") (emphasis added); 1 B.E. Witkin, Summary of California Law, Sec. 919, at 821 (9th ed. 1987) (noting implied assent lacking where evidence fails to show acknowledgment of "a definite and fixed sum").

The evidence at trial showed the parties never agreed upon a definite and fixed sum. Flexsol's December 10, 1987 letter merely acknowledged an outstanding obligation. It expressly disputed a sizeable portion of the remaining balance. Further, Flexsol requested a detailed account so that "necessary adjustments" could be made. The disagreement over a sum certain persisted. On May 19, 1988, GBI sent a revised demand letter to Flexsol, including an invoice listing. Flexsol replied to the renewed demand by explicitly disagreeing with the amount, adding it would "pay what we think we owe you" after a definitive check of the account had been made.

GBI argues Flexsol impliedly assented to a readily calculable balance, relying upon Joslin v. Gertz, 317 P.2d 155, 158 (Cal.Ct.App.1957). However, in Joslin, unlike here, it was also undisputed that the underlying items were agreed upon and the balance was readily ascertainable. Id. In this case, there was no underlying agreement from which to calculate.

REVERSED.