Legal Question in Civil Litigation in California
I am being sued by a California corporation that is currently suspended. There is a 2nd case management hearing in a few days. I would like to know if there is documentation that I have to present to dismiss the case due to the corporation being suspended or will the judge dismiss the case as due process?
3 Answers from Attorneys
The judge will not dismiss on his or her own. They will also not dismiss at a CMC. You must make a motion to dismiss for lack of standing to maintain the action and set that motion for its own hearing.
You'd have to file an appropriate motion to dismiss, based upon those facts. However, once the company receives your motion, I would bet they will correct the problem before the hearing on the motion, if the amount of your case makes it worth doing for them. If you want to get legal counsel to represent you in this case, feel free to contact me.
This is a question that involves an area that causes a lot of confusion to attorneys, and lay people representing themselves.
A corporation whose powers have been suspended for nonpayment of the corporate franchise tax lacks capacity to sue in California courts. (Rev. & Tax. Code, sect. 23301) But a suspension of corporate powers results ina lack of capacity to sue, not a lack of standing to sue. (Color-Vue, Inc. v. Abrams (1996) 44 Cal.App.45th 1599, 1603-1604.)
It does not entitle you to file a motion to dismiss, contrary to what the two previous attorneys posted. A corporation's suspended status and lack of capacity to sue is a plea in abatement that must be asserted at the earliest opportunity. (Cadle Co. v. World Wide Hospitality Furniture, Inc. (2nd Dist. 2006) 144 Cal.App.4th 504.)
Because it is a plea in abatement, it must be raised in the answer, or by demurrer, or else it is waived.
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