thereafter transformed into a tenancy from month to month. The inception of this contention is found in the arrangement which was entered into in the first instance by plaintiff's wife and the lessees which it is claimed contemplated creating, and fixed a modification of the terms of the lease which, though orally made subsequently, became by the parties performing pursuant to its terms, an executed agreement, and therefore binding upon and enforceable against both parties despite the fact that the lease itself provided that it should "not be changed, altered, or modified except by writing indorsed hereon and signed by the parties hereto."

We find nothing in the evidence which would have compelled the trial court to find and conclude that the initial arrangement was sought, intended, and understood by the parties to be a permanent modification of the terms of the lease, or that it eventuated into anything more than a mere temporary abatement of the rent from month to month which was acceded to from time to time in response to the urgent and insistent importunities of the lessees. Clearly, the correspondence of the parties, considered in its entirety, cannot be taken as decisively indicating that the initial agreement was at its inception intended to extend beyond and control the situation for any greater length of time than might be necessary to temporarily tide the lessees over the slack summer months. To the contrary, that correspondence, we think, tends to show that the lessees understood the initial arrangement to be nothing more than a temporary concession, otherwise why should they as late as April and May, 1914, writing plaintiff say: "Referring to the rent proposition. It is impossible to state at this time what can be done in the future What concessions are you willing to make from April 1st." Then, again, there is the evidence of plaintiff's wife to the effect that at no time was there any discussion with her concerning a permanent reduction in the rent and that she entered into the initial arrangement with the lessees "only because they said they were up against it; that the house was nearly empty and wanted to know if we would do that for the summer months." The testimony of plaintiff's wife in the particular that the arrangement was only for the slack summer months is fortified in a measure by a letter of the lessee Anna Spare, dated November 20, 1913, to the plaintiff, wherein she said: "I arranged with Mrs. Campbell before she left to

...

endeavor to pay a monthly rent of $400 during the winter months commencing with October providing the business justified." Aside from the fact that the truth of the statement contained in this letter concerning a new arrangement for a fixed rental for the winter months was flatly denied by the testimony of the plaintiff's wife and was, therefore, a controverted fact in the case, the letter itself not only falls short of supporting, but in a measure tends to defeat the contention that the initial arrangement was intended to extend beyond certain months, and contemplated the permanent substitution of a varying sum in payment of the rentals to be derived from the contingent profits of the business in lieu of the sum certain fixed and reserved as rentals by the terms of the lease. (Driscoll v. Myers, 34 Cal. App. 490, [168 Pac. 145].) [1] The fair inference, it seems to us, to be drawn from the dealings and conduct of the parties is that they were desirous and willing to meet and overcome an embarrassing financial situation through the medium of temporary concessions which were not intended or accepted by the parties as permanently impairing or abrogating the original terms of the lease. The case of Raymond v. Krauskopf, 87 Iowa, 602, [54 N. W. 432], so strongly relied upon to support appellants' contention does not seem to us to be in point. That case was an action to recover rent originally reserved in a written lease of land which required the lessee to farm the land in a farmerlike manner, to plant corn by the 20th of May, and to deliver to the lessor by the twenty-fifth day of the following November, sixteen bushels of corn per acre. The lessee cultivated

the land as required, but the growing crops thereon having been damaged by storms, the parties entered into a parol agreement whereby the lessee was to replant the leased land to corn, farm it to the best of his ability and then deliver to the lessor "in full of all demands for rent" one-half of the replanted corn. In keeping with the new agreement the lessee replanted the land to corn, farmed it during the remainder of the season, and of the 350 bushels of corn ultimately harvested, delivered about two hundred bushels to the lessor in payment of the rent. The appeal was from a judgment entered upon a directed verdict in favor of the lessor in the sum of $204, which evidently represented the difference between the value of the delivered and accepted two hundred bushels of corn and that of 480 bushels which the lessor

claimed was due him under the provisions of the written lease. It will be noted that in that case no question of a periodical reduction in the payment of rent was, as here, involved, and that when disposing of the appeal the court evidently proceeded upon the theory that the evidence showed, as it doubtless did, that the oral negotiations of the parties had ripened into a fully executed contract and the only question really decided was whether or not the oral agreement was supported by a good consideration. In discussing that question, the court, while distinguishing, in effect, approved the case of Wheeler v. Baker, 59 Iowa, 86 [12 N. W. 767], where it was held that the rental terms of a written lease for the entire term were not abrogated, nor was the lessor bound to accept for the full term the reduced rental of certain months, because of the fact that the lessor had ex mera gratia accepted the reduced rental for a portion of the time. The case of Sinnige v. Oswald, 170 Cal. 55, [148 Pac. 203], seems to be decisive of the point presented here. Its facts are practically parallel, in their essential features with the facts of the present case, and it was there said: "The finding that there was no change in the terms of the lease in the alleged particular of reducing the rent is sustained by the evidence. Concessions of the kind that were shown by the defendants, when supported by a consideration, are valid to the extent that a lower rent has been tendered and accepted as satisfaction in full of the installments thus paid. They are not sufficient to establish a change in the written contract so as to affect the amount of future installments of rent where no such change of terms has been made in writing."

The judgment is affirmed.

Wilbur, J., and Melvin, J., concurred.

[L. A. No. 4673. Department Two.-March 10, 1919.]

CHARLES I. WHITE, Appellant, v. E. H. KINCAID, Respondent.

[1] CONTRACT - - DELIVERY OF LUMBER IN PAYMENT OF DEBT - -AGREEMENT BETWEEN PARTNERSHIP AND CREDITOR SUBSEQUENT INCORPORATION OF PARTNERSHIP LACK OF KNOWLEDGE OF CREDITOR LIABILITY FOR LUMBER-AGENCY.-Where a creditor of a partnership operating a lumber-yard agreed to accept lumber in payment of a firm debt to him, and without his knowledge the firm incorporated after he had received several deliveries extending over a period of months, and the corporation was managed by the manager of the partnership, such partners were the agents of the undisclosed principal, the corporation, and where settlement was made with them, the creditor is not liable to the corporation for the lumber. [2] ID. TRANSFER OF BUSINESS-WANT OF CHANGE OF POSSESSION— VOID AS TO CREDITOR.-Under such circumstances, the transfer of the lumber-yard business from the partnership to the corporation was void as to the creditor for want of change of possession as provided by section 3440 of the Civil Code, and the lumber, so far as the creditor was concerned, still belonged to the partnership. APPEAL from a judgment of the Superior Court of Los Angeles County. Wm. D. Dehy, Judge Presiding. Affirmed.

The facts are stated in the opinion of the court.

Duke Stone for Appellant.

Haas & Dunnigan for Respondent.

WILBUR, J.—The plaintiff sued, as assignee of Clark Brothers Lumber Company, a corporation, for lumber alleged to have been sold by said corporation to the defendant. Clark Brothers, a copartnership, for more than twenty years had transacted business with the defendant. For three years previous to October 10, 1913, they had operated a lumber-yard in Los Angeles. In July, 1913, the copartnership owed the defendant about six thousand dollars, evidenced by a promissory note. At that time it entered into an agreement with the defendant to sell and deliver him lumber, and the defendant agreed to credit the purchase price thereof on the promis

sory note of the copartnership. The defendant procured lumber from time to time at the lumber-yard operated by the copartnership, and on October 14, 1914, a settlement was had whereby the sum of three thousand three hundred dollars was credited on said note. The controversy in this case arises over the fact that on October 10, 1913, a corporation was formed under the name and style of "Clark Brothers Lumber Company," with a capital stock of 750 shares. W. E. Clark, one of the Clark Brothers, held 459 shares, B. W. Clark, the other member of the copartnership, one share, and, in addition to these shares of stock, 21 shares were issued. W. E. Clark was president, B. W. Clark vice-president, and Robert P. Holmes manager. Robert P. Holmes was manager of the copartnership and continued to manage the same yard for the corporation. The lumber herein sued for was delivered to the defendant at the lumber-yard by Holmes. The defendant testified that he was never notified of any change in the management of the lumber-yard and that he continued to get lumber at the yard believing that the same was being delivered to him by the copartnership. Both of the Clark brothers testified that the lumber was delivered to the defendant with the understanding that it was to be charged to the copartnership, but was to be carried on the books of the corporation in the name of the defendant merely for convenience of the copartnership. The trial court found that the lumber was purchased by the defendant from Clark Brothers, a copartnership, and was paid for by giving credit upon the note due from the copartnership to the defendant, and that nothing was due from the defendant to the corporation. Respondent correctly claims that, upon the view most favorable to the appellant, Clark Brothers were the agents for the undisclosed principal, the corporation, and that having settled with the agent he is no longer liable to the principal; citing Argenti v. Brannan, 5 Cal. 351; Eldridge v. Finninger, 25 Okl. 28, [28 L. R. A. (N. S.) 227, 232, 105 Pac. 334]. Appellant's position, in part, is thus stated: "Suppose that Kincaid did not know he was dealing with the corporation, then this was due to the acts and conduct of Clark Brothers by leading him to believe that he was dealing with them, and his complaint should be against them and not against the corporation, whose property he received, used and made a part of his estate." In short, appellant's contention is that the respondent, having