Bovet v. Chang, No. D070797 (D1d4 Jun. 7, 2017)
Plaintiff is a judgment creditor to a suspended corporation. In enforcement of judgment proceedings, Plaintiff was assigned certain of debtor’s assets, including certain funds held for potential escheat by the State Controller. Plaintiff filed claims for the property with the Controller, which the Controller denied based on the debtor’s being a suspended corporation. Plaintiff sued, but the court dismissed, on the grounds that the assignee of a suspended corporation can’t enforce that corporation’s rights in court because the corporation has no capacity to sue or defend on its own.
It’s not controversial that a suspended corporation can’t voluntarily assign rights to another, who then can sue to enforce the rights. That make it too easy avoid the consequences of the suspension, which include a disability to prosecute or defend actions in court. Plaintiff, however, claims that it stands in different stead because the assignment here was an involuntary judicial assignment obtained to collect on a debt.
That has some intuitive sense to it, but the Court of Appeal doesn’t agree, resting on the formalism that the assignee takes subject to whatever defenses the assignor was subject to. According to the court, “It makes no difference if the assignment is voluntary or through a judicial assignment made in the enforcement of judgment process for a corporation refusing to pay a judgment or obligation. The result is the same and should not be permitted.”
Affirmed.
Subscribe to:
Post Comments (Atom)
That's Not a Debate
Taylor v. Tesla , No. A168333 (D1d4 Aug. 8, 2024) Plaintiffs in this case are also members of a class in a race discrimination class action ...
-
RSB Vineyards, LLC v. Orsi , No. A143781 (D1d3 Sept. 29, 2017) In this real estate warranty case, the court affirms a summary judgment in ...
-
Pollock v. Superior Court , No. B321229 (D2d1 Jul. 31, 2023) Back in 2019, the Legislature amended Code of Civil Procedure § 2031.280 to inc...
No comments:
Post a Comment