From time to time, civil litigation requires that a litigant sue a dissolved corporation. At common law, a corporation ceased to exist and could not sue or be sued once it had dissolved, but the California legislature abandoned these common law rules in 1929. See Penasquitos, Inc. v. Superior Court (1991) 53 Cal. 3d 1180, 1184-85.
Even if a dissolved corporation can be sued, a question still remains regarding how the litigant can serve this defunct corporation with “process.” In other words, the litigant needs to determine who can be served with certain court papers.
Luckily, the California legislature carefully outlined the process for effectuating service of process upon dissolved corporations in Corporations Code Section 2011(b). Pertinently, process “may be served by delivering a copy thereof to an officer, director or person having charge of its assets or, if no such person can be found, to any agent upon whom process might be served at the time of dissolution.”
If the litigant’s attempts at direct service can be proven, by affidavit, to the court to be reasonably diligent, then the court may order that “summons or other process be served upon the dissolved corporation by personally delivering a copy thereof, together with a copy of the order, to the Secretary of State.” If you find yourself in this situation, be sure to check for any other requirements, including statutory fees, necessary to properly serve the Secretary of State on behalf of a defunct entity.
If you’re currently engaged in a pre-litigation dispute or you’re contemplating pursuing legal action against another party, we highly recommend that you speak with an attorney to ensure that your rights are adequately protected.
Liam Perry is an Associate Attorney at The Loftin Firm. For questions relating to this blog post or any other California real estate, land use, corporate, or estate planning matter, contact The Loftin Firm at760-814-9649.