Legal Question in Real Estate Law in California

If the corporation is of no real use to you, why not dissolve it and distribute the assets, one of which is the right to sue on the debt. If it is of value to you, find out how much it would cost to make it an active corporation [I assume you know that an inactive corportion can not sue]. The statute of limitations on a wriltten contract is four years from the breach of the contract. A mortgage is probably an on going obligation since interest payments are due on any arrears so it effectively hs no statutute of limitations. I do not know enough about corporate tax laws or in what legal status the corporation was [S corp, LLC], but find out if you are able to claim any tax deductioins for losses suffered by the corporation [I am assuming the property may no longer be worth more than the debt] or must they be taken by you via distributing the bankrupt assets.

A suspended corporation can't conduct any business. If the corp can be wound down with you entitled to its assets, then you can take action yourself. Otherwise, the corp would have to be brought 'active' and current to do this itself. If serious about getting legal help to accomplish this, feel free to contact me.

This is a very interesting question, and while the previous answers might be correct, I'm not so sure; this might even be a situation that has never been decided by our courts.

It is certainly true that a suspended corporation cannot sue or defend in court, but when a suspended corporation does conduct business, those acts are not necessarily, ipso facto, void; in fact, a suspended corporation's acts and deeds are valid unless and until the other party to the contract or activity formally objects and takes action to rescind.

Further, the "action" to be taken (foreclosure) is neither a court proceeding nor, arguably, the conducting of business by the corporation......instead, it is arguably an action by the trustee named in, and pursuant to, the deed of trust. True, the trustee is acting at the request of the suspended corporation, but is acting under a power granted him by the deed of trust, not a power given the corporation (and now suspended) by the State of California.

Why don't you have the corporation go ahead and foreclose, and in five years I can read what the California Supreme Court decision on your case, to see what it thinks? Just kidding. You should first look at how much it would cost to pay the back taxes and get a certificate of revivor. Start with the Franchise Tax Board; they have an application form, I think. If it's reasonable, go that way. As to dissolving the corporation, I'm not sure you can do that without paying the taxes.