Macmillan Petroleum Corp. v. Griffin, 14300

• Citation: 99 Cal.App.2d 523,222 P.2d 69
• Decision Date: 21 September 1950
• Docket Number: No. 14300,14300
• Court: California Court of Appeals
• Parties: MACMILLAN PETROLEUM CORPORATION v. GRIFFIN et al.

Page 69

222 P.2d 69

99 Cal.App.2d 523

MACMILLAN PETROLEUM CORPORATION v. GRIFFIN et al.

No. 14300.

District Court of Appeal, First District, Division 1, California.

Sept. 21, 1950.

Rehearing Denied Oct. 21, 1950.

Hearing Denied Nov. 16, 1950.

Robert E. Hatch, San Francisco, Frederick W. Mahl, Jr., Los Angeles, for appellant.

Courtney L. Moore, San Francisco, for respondents.

BRAY, Justice.

The basic questions are whether a certain order granting enforcement of a judgment is void because the then plaintiff was a dissolved Nevada corporation, and whether it could be set aside when the true status of the plaintiff was discovered. There is also involved the question of the validity of an ex parte order substituting party plaintiff. There are a number of orders made culminating in the order appealed from.

Summary.

On May 17, 1934, Mileage Gasoline Company (hereafter called Mileage) recovered a judgment against defendants Griffin and Jovick. Approximately 13 years later, in 1947, an application by Mileage's attorney was made to the superior court on notice to grant enforcement of this judgment and to order execution to issue. Apparently, Griffin was not served, and so far as this appeal is concerned will not be considered further. December 19, 1947, the court made an 'Order Granting Leave to Enforce Judgment' against Jovick. Thereafter the following orders were made and proceedings had:

April 20, 1948--a minute order denying respondent's motion to vacate the order of enforcement.

May 3--an ex parte order vacating the April 20 order, enforsed on a notice of motion by respondent to be heard May 7 to vacate that very order.

June 14--an order (1) vacating the order of April 20; (2) permitting respondent to renew his motion to vacate the December 19 order; (3) granting his motion to vacate that order; and (4) denying Mileage the right to enforce the judgment.

(June 15--respondent appealed from the April 20 order. This appeal apparently has not been perfected.)

August 10--by stipulation the order of June 14 was vacated and the matters which were before the court on June 14 were to be again presented. At this moment, the order of April 20 refusing to vacate the order of enforcement was in effect, unless the order of May 3 vacating it was valid.

August 21--an ex parte order substituting Macmillan Petroleum Corporation (hereafter called Macmillan) for Mileage as party plaintiff.

September 4--respondent filed notice of motion to set aside this order of substitution.

October 25--Mileage and Macmillan filed notice of motion to vacate the May 3 order which purported to vacate the April 20 order.

December 3--the order appealed from. The order (1) denied plaintiff's motion to set aside the order of May 3; (2) granted respondent's motion to vacate the order of April 20; (3) granted respondent's motion to vacate the August 21 order of substitution; (4) granted respondent's motion to set aside the December 19 order of enforcement and denied plaintiff the right to enforce the judgment.

Order of Substitution.

Respondent contends that neither Mileage nor Macmillan have any standing on this appeal--Mileage, because it is a dissolved Nevada corporation with no capacity to appear in this case; and Macmillan, because the order of substitution is void. For the reasons hereafter set forth in the discussion concerning the validity of the December 19 order, Mileage has no capacity to carry on this litigation, and hence its appeal must be dismissed. Moreover, if the order substituting Macmillan is valid, Mileage is completely out of the case, and hence could not appeal if it had capacity. Macmillan claims to hold an assignment of the judgment made by Mileage prior to its dissolution. An assignee is entitled to be substituted as party plaintiff in the place of the assignor. Bancroft's Code Practice and Remedies, vol. 1, p. 651. That portion of the order of December 3 setting aside the order of substitution was made upon the claim by respondent that the order was invalid because made ex parte. While it is better practice that a notice be given, there is no requirement that notice of application for substitution of a party plaintiff be given to the defendant. Bancroft's Code Practice and Remedies, vol. 1, p. 654. Respondent also contended that it was invalid because made by the presiding judge of the superior court rather than by the judge in whole department the matter was pending. It is not clear from respondent's brief whether he still makes the same contention. The point is unfounded. There is but one superior court in a county, and the action of any judge of that court is the action of the court, and not merely of the particular judge. Brown v. Campbell, 110 Cal. 644, 43 P. 12. As the order of substitution was valid, that portion of the order of December 3 vacating it must be reversed.

Was the Order of Enforcement Void?

The application for order enforcing the judgment was based, as it had to be, on the claim that the then plaintiff had exercised due diligence in not collecting the judgment theretofore. It was accompanied by the affidavit of Attorney Hatch in which he stated that continuously from a time prior to the date of the judgment he had been one of the attorneys for plaintiff. He then set forth efforts to collect the judgment, and that under examination, defendants had stated that they had no assets, but agreed to notify affiant whenever they were able to make any payments. Affiant had never been so notified, but recently had learned that they, or at least respondent, did have assets. There was no mention of Macmillan in the proceedings. On the motion heard April 20 to vacate the December 19 order of enforcement, respondent filed an affidavit claiming that the December 19 order of enforcement had been taken against him by surprise and excusable neglect in that at that time he did not know that Mileage was a dissolved Nevada corporation. He then set forth that Mileage had been a Nevada corporation which had surrendered its license and authority to conduct business in California, and had voluntarily dissolved on December 24, 1937. A certificate of its withdrawal from business in California and of its dissolution in Nevada accompanied the affidavit. This fact of dissolution has never been denied, and could not be, in view of the certificate of dissolution. On August 21, on the ex parte application for substitution, Macmillan filed an affidavit of Morris P. Macmillan, former president of Mileage and now vice president of Macmillan, stating that prior to the dissolution of Mileage it had assigned its assets to Macmillan and that as president of Mileage and vice president of Macmillan he had authorized Attorney Hatch to proceed with the enforcement and collection of all judgments.

It appears from the affidavit later filed by respondent on the proceedings to set aside the order of April 20, which order refused to vacate the order of enforcement, that court and counsel on the April 20 hearing assumed that the effect of the dissolution of Mileage was to be determined by California rather than Nevada law. When respondent's counsel returned to his office he discovered authorities which convinced him that the Nevada law should govern. He thereupon wrote a letter to the judge to whom the matter had been submitted calling his attention to the law on the subject, but the judge had already decided the matter adversely to him by making the April 20 order. Respondent thereupon filed a notice of motion to vacate that order, setting forth in an affidavit these facts.

Respondent concedes that the court had no authority in its May 3 or December 3 order to set aside the order of April 20 denying his motion to vacate the order of enforcement on the grounds of a mistake in law or fact. Such mistake could be considered only on the appeal from that order. Respondent contends, however, that as the order of enforcement of December 19 was void because the court had no jurisdiction of the person of Mileage, likewise the order of April 20 was void in refusing to vacate that order, and that, in any event, the order of enforcement being void, the court's order of December 3 vacating it was proper.

Effect of Dissolution of Nevada Corporation.

This question must be determined by the Nevada and not the California law. 'It appears to be settled law that the effect of the dissolution of a corporation, or its expiration otherwise, depends upon the law of its domicile (Restatement, Conflict of Laws, pp. 228, 229, sec. 158; 20 C.J.S., Corporations, §§ 1899, 1900, pp. 128, 129, and that a defunct foreign corporation has no greater capacity or higher standing to commence or maintain an action in the state of the forum than it would have in the state of its domicile. [Citations.]' Fidelity Metals Corp. v. Risley, 77 Cal.App.2d 377, 381, 175 P.2d 592, 594. In re Estate of Lund, 26 Cal.2d 472, 159 P.2d 643, 162 A.L.R. 606, (on the question of legitimation of a child), and the cases against the Hibernia Savings & Loan Society, Maguire v. Hibernia Savings & Loan Soc., 23 Cal.2d 719, 146 P.2d 673, 151 A.L.R. 1062 (on the question of membership in the Hibernia Bank), cited by plaintiff on the policy of the lex forum, are not in point. This court takes judicial notice of the laws of the several states. Code Civ.Proc, § 1875, subd. 3; Corporations Code, § 6602. The Nevada law provides that upon filing with the Secretary of State the certificate of dissolution provided for, the corporation is dissolved, although it may continue for the period of three years thereafter for the purpose of prosecuting and defending suits. After the expiration of the three years, it is completely defunct. It "no longer exists for any purpose." Fidelity Metals Corp. v. Risley, supra, 77 Cal.App.2d at page 382, 175 P.2d 592, 594. There was until 1949 no provision, as under California law, for the directors to continue as trustees to carry on any of its powers. Mileage was...