CACI No. 3304. Presumptions Concerning Costs - Manufacturer

Judicial Council of California Civil Jury Instructions (2025 edition)

Download PDF
Bg974
3304.Presumptions Concerning Costs - Manufacturer
A manufacturer’s costs include the cost of raw materials and the cost of
manufacturing.
The cost of manufacturing is the average cost of manufacture over a
reasonable time, rather than the cost of one item at a particular time.
[If [name of defendant]’s cost for raw materials cannot be computed, the
cost is presumed to be the prevailing price for similar raw materials at
the time and place those materials would usually be purchased.]
[If [name of defendant]’s trade or industry has an established cost study
or survey for the geographic area in this case, that cost survey may be
considered in calculating [name of defendant]’s costs.]
[[Name of defendant]’s delivery costs are presumed to be the tariffs set by
the California Public Utilities Commission, but this presumption may be
overcome by other evidence.]
New September 2003
Directions for Use
The bracketed sentences should be inserted as necessary.
Sources and Authority
• “Cost” Defined. Business and Professions Code section 17026.
• Cost Survey Is Competent Evidence. Business and Professions Code section
17072.
• Presumptive Evidence of Cost. Business and Professions Code section 17073.
• Transportation Tariffs Are Presumptive Evidence of Delivery Costs. Business and
Professions Code section 17074.
• Prevailing Market Price Is Presumptive Evidence of Cost of Raw Materials.
Business and Professions Code section 17077.
• “Determination of the defendant’s cost has always been treated as an issue of
fact.” (Pan Asia Venture Capital Corp. v. Hearst Corp. (1999) 74 Cal.App.4th
424, 432 [88 Cal.Rptr.2d 118].)
• “California appears to have adopted a very expansive approach to the evidence
that may be used to establish cost; no formula has been expressly sustained or
denounced.” (Pan Asia Venture Capital Corp., supra, 74 Cal.App.4th at p. 436.)
• “These statutes embody California’s fully allocated cost standard, that is, a fair
allocation of all fixed or variable costs associated with production of the article
or product.” (Pan Asia Venture Capital Corp., supra, 74 Cal.App.4th at p. 432,
footnote omitted.)
550
Bg975
• “Cost is to be measured as ‘the fair average cost of production over a reasonable
time, rather than the cost of one item on a particular occasion.’ ” (Pan Asia
Venture Capital Corp., supra, 74 Cal.App.4th at p. 432, fn. 6, internal citation
omitted.)
Secondary Sources
1 Witkin, Summary of California Law (11th ed. 2017) Contracts, §§ 623-629
3 Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts,
§ 40.153 (Matthew Bender)
49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition,
§ 565.52 (Matthew Bender)
23 California Points and Authorities, Ch. 235, Unfair Competition, § 235.22 et seq.
(Matthew Bender)
UNFAIR PRACTICES ACT CACI No. 3304
551

© Judicial Council of California.