This case was last updated from Los Angeles County Superior Courts on 02/07/2020 at 00:22:58 (UTC).

CREDITORS ADJUSTMENT BUREAU, INC. VS. SUN & STARS LIGHTING

Case Summary

On 03/06/2017 CREDITORS ADJUSTMENT BUREAU, INC filed a Contract - Other Contract lawsuit against SUN STARS LIGHTING. This case was filed in Los Angeles County Superior Courts, Glendale Courthouse located in Los Angeles, California. The Judge overseeing this case is RALPH C. HOFER. The case status is Pending - Other Pending.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****6114

  • Filing Date:

    03/06/2017

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Contract - Other Contract

  • Courthouse:

    Glendale Courthouse

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judge

RALPH C. HOFER

 

Party Details

Plaintiff

CREDITORS ADJUSTMENT BUREAU INC.

Defendant

SUN & STARS LIGHTING INC.

Attorney/Law Firm Details

Plaintiff Attorneys

FREED ESQ. KENNETH J.

FREED KENNETH JAY

Defendant Attorneys

LEXINT LAW GROUP APLC

HSU ROBERT CHIHMING

 

Court Documents

Minute Order - Minute Order (Status Conference re: Bankruptcy Filing Status; 2) Related Ca...)

2/7/2019: Minute Order - Minute Order (Status Conference re: Bankruptcy Filing Status; 2) Related Ca...)

Summons

3/6/2017: Summons

Civil Case Cover Sheet

3/6/2017: Civil Case Cover Sheet

Legacy Document - LEGACY DOCUMENT TYPE: Complaint filed-Summons Issued

3/6/2017: Legacy Document - LEGACY DOCUMENT TYPE: Complaint filed-Summons Issued

Certificate Of Mailing - Attachment

3/9/2017: Certificate Of Mailing - Attachment

Case Management Statement

4/26/2017: Case Management Statement

Minute Order - Minute order entered: 2017-05-22 00:00:00

5/22/2017: Minute Order - Minute order entered: 2017-05-22 00:00:00

Proof of Service (not Summons and Complaint)

6/2/2017: Proof of Service (not Summons and Complaint)

Minute Order - Minute order entered: 2017-06-26 00:00:00

6/26/2017: Minute Order - Minute order entered: 2017-06-26 00:00:00

Proof of Service (not Summons and Complaint)

7/10/2017: Proof of Service (not Summons and Complaint)

Case Management Statement

7/10/2017: Case Management Statement

Legacy Document - LEGACY DOCUMENT TYPE: Notice

7/19/2017: Legacy Document - LEGACY DOCUMENT TYPE: Notice

Legacy Document - LEGACY DOCUMENT TYPE: Notice

7/27/2017: Legacy Document - LEGACY DOCUMENT TYPE: Notice

Notice of Change of Address or Other Contact Information

7/28/2017: Notice of Change of Address or Other Contact Information

Minute Order - Minute order entered: 2017-08-31 00:00:00

8/31/2017: Minute Order - Minute order entered: 2017-08-31 00:00:00

Minute Order - Minute order entered: 2017-10-31 00:00:00

10/31/2017: Minute Order - Minute order entered: 2017-10-31 00:00:00

Minute Order - Minute order entered: 2017-12-05 00:00:00

12/5/2017: Minute Order - Minute order entered: 2017-12-05 00:00:00

Minute Order - Minute order entered: 2018-08-14 00:00:00

8/14/2018: Minute Order - Minute order entered: 2018-08-14 00:00:00

19 More Documents Available

 

Docket Entries

  • 02/13/2019
  • DocketNotice (Notice of Ruling at Status Conference; Notice of Continued Status Conference and OSC); Filed by CREDITORS ADJUSTMENT BUREAU, INC. (Plaintiff)

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  • 02/07/2019
  • Docketat 08:30 AM in Department D; Status Conference - Not Held - Continued - Court Congestion

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  • 02/07/2019
  • DocketMinute Order ( (Status Conference re: Bankruptcy Filing Status; 2) Related Ca...)); Filed by Clerk

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  • 08/14/2018
  • Docketat 08:30 AM in Department D; Status Conference (Status Conference; Matter continued) -

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  • 08/14/2018
  • Docketat 08:30 am in Department NCGD, Ralph C. Hofer, Presiding; Status Conference - Matter continued

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  • 08/14/2018
  • DocketMinute order entered: 2018-08-14 00:00:00; Filed by Clerk

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  • 07/18/2018
  • Docketat 08:30 AM in Department D; Case Management Conference - Not Held - Advanced and Vacated

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  • 07/03/2018
  • DocketNotice (OF COURT'S ORDER RE RELATED CASES IN EC065714, EC066114 AND EC066119 ); Filed by Attorney for Defendant

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  • 07/03/2018
  • DocketNotice; Filed by SUN & STARS LIGHTING, INC. (Defendant)

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  • 06/18/2018
  • Docketat 08:32 AM in Department D; (Order to Show Cause; Order Made) -

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44 More Docket Entries
  • 03/09/2017
  • DocketCertificate of Mailing (AMENDED NOTICE OF ORDER TO SHOW CAUSE AND AMENDED NOTICE OF CASE MANAGEMENT CONFERENCE MAILED TO ATTORNEY FOR PLAINTIFF ON THIS DATE 03/09/2017. ); Filed by Clerk

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  • 03/09/2017
  • DocketCertificate of Mailing - Attachment; Filed by Clerk

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  • 03/06/2017
  • DocketComplaint filed-Summons Issued

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  • 03/06/2017
  • DocketComplaint filed-Summons Issued; Filed by null

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  • 03/06/2017
  • DocketNotice of Case Management Conference

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  • 03/06/2017
  • DocketNotice of Case Assignment - Unlimited Civil Case (AMENDED)

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  • 03/06/2017
  • DocketCivil Case Cover Sheet

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  • 03/06/2017
  • DocketNotice of Order to Show Cause Re Failure to Comply with Trial Court Delay Reduction Act

    Read MoreRead Less
  • 03/06/2017
  • DocketSummons Filed

    Read MoreRead Less
  • 03/06/2017
  • DocketSummons; Filed by null

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Tentative Rulings

Case Number: EC066114    Hearing Date: February 19, 2021    Dept: D

TENTATIVE RULING
Calendar:        27
Date:               2/19/2021  
Case No:         EC066114                                     Trial Date:  None Set 
Case Name:    Creditors Adjustment Bureau, Inc. v. Sun & Star Lighting, Inc. 
MOTION TO STRIKE ANSWER
 
Moving Party:          Plaintiff Creditors Adjustment Bureau, Inc.   
Responding Party:    Defendant Sun & Stars Lighting, Inc.   (No Opposition)      
RELIEF REQUESTED:
Strike answer of defendant   
SUMMARY OF FACTS:
Plaintiff Creditor’s Adjustment Bureau, Inc. alleges that defendant Sun & Stars Lighting, Inc. became indebted to plaintiff’s assignor, Leedarson Lighting Co. Ltd., in the amount of $1,171,870.08, due on September 16, 2015, which defendant has failed to repay.  The complaint alleges causes of action for open book account, account stated, reasonable value, and breach of contract. 
On June 30, 2017, defendant filed its answer to plaintiff’s unverified complaint. 
On September 1, 2017, defendant filed a Notice of Stay of Proceedings, based on an automatic stay caused by the filing of defendant’s bankruptcy case.  
The matter has been stayed.  The motion submits a docket showing that the subject bankruptcy case was closed on October 25, 2019.  [Freed Decl. ¶ 2, Ex. 1]. 
The court may accordingly consider the motion to strike. 
This motion was originally heard on December 4, 2020, along with a motion to be relieved as counsel filed by the attorney for defendant Sun & Stars Lighting.  The motion to be relieved as counsel was granted.
The motion to strike the answer of suspended corporation Sun & Stars Lighting was continued to this date, “to afford the defendant a reasonable time to be notified by counsel of the pendency of this motion and to effect reinstatement.”
ANALYSIS:
Under CCP§ 436:
“The court may, upon a motion made pursuant to CCP § 435, or at any time in its discretion, and upon terms it deems proper:….
(b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.”
The motion argues that Sun & Star Lighting, Inc. is a suspended corporation.  The motion submits evidence from the Secretary of State Business Search Entity Detail showing that this entity as of January 10, 2020, had the status of “SOS SUSPENDED.” [Freed Decl. ¶ 3, Ex. 2].  
““Corporations Code section 2205, subdivision (c) makes clear that, 'except for the purpose of amending the articles of incorporation to set forth a new name,' the suspended corporation may transact no business of any kind.” (Palm Valley Homeowners Assn., Inc. v. Design MTC, supra, 85 Cal.App.4th at p. 560.) Since “[c]onducting litigation is not 'amending the articles of incorporation to set forth a new name[,]' ” (ibid.) corporations that have been suspended for failing to file the requisite information statement are “disabled from participating in litigation activities.” (Id. at p. 556.) 
Leasequip, Inc. v. Dapeer (2002, 2nd Dist.) 103 Cal.App.4th 394, 402. 
It is recognized that the proper remedy for such an irregularity is to stay the matter for a reasonable time pending revival of the corporation.   See Color-Vue v. Abrams (1996, 2nd Dist.) 44 Cal.App. 4th 1599, 1605-1606. 
The Second District in Timberline, Inc. v. Jaisinghani (1997) 54 Cal.App.4th 1361, 1365-66 has stated that if a corporation’s suspended status only comes to light during litigation, “the normal practice is for the trial court to permit a short continuance to enable the suspended corporation to effect reinstatement (by paying back taxes, interest and penalties) to defend itself in court.”  Timberline, at 1366, citation omitted.  The Second District emphasized that the purpose of the Revenue and Tax Code suspension provisions is to put pressure on corporations to pay taxes, and that this purpose is satisfied where tax delinquencies, once corrected, are treated as irregularities, with no further penalties.   Timberline, at 1366.
The court has continued this matter to permit a reasonable time to enable the suspended corporation to effect reinstatement.  The moving party has submitted a proof of service showing that defendant has been served with notice of this continued in sufficient time to file a response.  No timely opposition has been filed here, so there is no indication that defendant has any interest in pursuing reinstatement.  The motion has been pending since November 2, 2020, without any response from defendant.  The motion accordingly now is granted, and the answer is stricken. 
RULING:
[No Opposition]. 
UNOPPOSED Motion to Strike Answer of Suspended Corporation Sun & Stars Lighting, Inc. is GRANTED.  The Court finds that notice of this hearing has been duly served on defendant Sun & Stars Lighting, Inc., and that despite the Court permitting defendant, a suspended corporation, a reasonable time effect reinstatement, defendant has failed to respond to this motion, or shown that it has effected reinstatement or intends to do so.  
The answer filed on June 30, 2017 is ordered stricken. 
GIVEN THE CORONAVIRUS CRISIS, AND TO PROMOTE APPROPRIATE SOCIAL DISTANCING, UNTIL FURTHER ORDERED, DEPARTMENT D IS ENCOURAGING AUDIO OR VIDEO APPEARANCES 
Please make arrangements in advance if you wish to appear via LACourtConnect by visiting www.lacourt.org, and scheduling a remote appearance.  Please note that LACourtConnect offers an audio-only appearance option at a current cost of $15.00 and a video appearance option at a cost of $23.00.   Counsel and parties (including self-represented litigants) are encouraged not to personally appear, unless they have obtained advance permission of the Court.  Anyone who appears in person for the hearing will be required to comply with strict social distancing measures, including, but not limited to, assigned seating, capacity limitations in the courtroom, designated waiting areas, and strictly enforced spacing in line to communicate with court staff.  If no appearance is set up through LACourtConnect, or otherwise, then the Court will assume the parties are submitting on the tentative. 

Case Number: EC066114    Hearing Date: December 04, 2020    Dept: D

TENTATIVE RULING

Calendar: 25

Date: 12/4/20

Case No: EC 066114 Trial Date: None Set

Case Name: Creditors Adjustment Bureau, Inc. v. Sun & Star Lighting, Inc.

MOTION TO BE RELIEVED AS COUNSEL

MOTION TO STRIKE ANSWER

Moving Party: Lexint Law Group, APLC (Relieved)

Plaintiff Creditors Adjustment Bureau, Inc. (Strike)

Responding Party: Defendant Sun & Stars Lighting, Inc. (No Opposition)

RELIEF REQUESTED:

Order relieving counsel as counsel of record

Strike answer of defendant

SUMMARY OF FACTS:

Plaintiff Creditor’s Adjustment Bureau, Inc. alleges that defendant Sun & Stars Lighting, Inc. became indebted to plaintiff’s assignor, Leedarson Lighting Co. Ltd., in the amount of $1,171,870.08, due on September 16, 2015, which defendant has failed to repay. The complaint alleges causes of action for open book account, account stated, reasonable value, and breach of contract.

On June 30, 2017, defendant filed its answer to plaintiff’s unverified complaint.

On September 1, 2017, defendant filed a Notice of Stay of Proceedings, based on an automatic stay caused by the filing of defendant’s bankruptcy case.

The matter has been stayed. The opposition submits a docket showing that the subject bankruptcy case was closed on October 25, 2019. [Freed Decl. ¶ 2, Ex. 1].

The court may accordingly consider the motion to strike.

The file also shows that on October 23, 2020, the court heard an OSC re Related Case Determination in Case No. EC065714. A minute order in this case refers to the minute order in EC 065714, the “lead case,” but that minute order does not include an order relating the cases.

Also on that date, the court heard a motion to strike the answer of defendant Sun & Stars Lighting, Inc., which had been continued from March to permit defendant, a suspended corporation, to effect reinstatement. The motion to strike was granted.

ANALYSIS:

Motion to Be Relieved as Counsel

Correct address in proof of service? (CCP §§1013, 1013a)

Client: ok

Other parties: ok

GROUNDS FOR MOTION:

Client has severed all communications with the attorney, attorney is no longer able to effectively represent client

DECLARATION BY MOVING ATTORNEY [CRC 3.1362 (c),(d)]:

Reasons why motion is necessary: ok

Address recently confirmed (within last 30 days)

Last known address. Counsel has been unable to confirm address is current by calling last known telephone number or numbers

PROPOSED ORDER (CRC 3.1362 (e)):

Address and phone number of client set forth: Last known

Proper warning: Ok

Future dates filled in: Not current

Procedural

It does not appear that proper service of this motion has been made on the client.

Under CCP § 284:

“The attorney in an action or special proceeding may be changed at any time before or after judgment or final determination, as follows:

1. Upon the consent of both client and attorney, filed with the clerk, or entered upon the minutes;

2. Upon the order of the court, upon application of either client or attorney, after notice from one to the other.”

(emphasis added).

Service on the client was made by mail at the client’s “last known address,” with counsel checking the box on the Declaration in support of the motion that counsel has been unable to confirm the address is current after calling the last known telephone number or numbers.

CRC Rule 3.1362(d) authorizes the service of a motion to withdraw on the client by mail where the motion is accompanied by a declaration stating facts showing the service address is either current or the last known address:

“If the notice is served by mail under Code of Civil Procedure section 1013, it must be accompanied by a declaration stating facts showing that either:

(1) The service address is the current residence or business address of the client; or

(2) The service address is the last known residence or business address of the client and the attorney has been unable to locate a more current address after making reasonable efforts to do so within 30 days prior to the filing of the motion to be relieved.”

CCP § 1011(b) sets forth requirements for personal service of a party at a residence and provides “(3) If the party’s residence is not known, any attempt of service pursuant to this subdivision may be made by delivering the notice or papers to the clerk of the court, for that party.”

The court will determine if counsel has complied with the requirement that “reasonable efforts” have been made to locate a more current address. The official form lists efforts such as mailing the motion return receipt requested, calling the last known telephone number, contacting persons familiar with the client, or conducting a search. The court will hear from counsel regarding what efforts have been made here, as a simple unsuccessful telephone call does not appear to constitute reasonable efforts. The court will discuss further reasonable efforts to be pursued, and will consider ordering counsel to serve the moving papers on the clerk of the court.

Substantive

If the procedural issue is corrected at the hearing, the paperwork is in order, except counsel has failed to provide on the order the motion to strike defendant’s answer scheduled for this date. The court accordingly continues the motion to strike answer to a future date to permit appropriate notice to be given to defendant, and for the reasons discussed below. Counsel is instructed to complete paragraph 7 of the order designating the next hearing in this matter which will be set at today’s hearing.

Motion to Strike

Under CCP§ 436:

“The court may, upon a motion made pursuant to CCP § 435, or at any time in its discretion, and upon terms it deems proper:….

(b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.”

The motion is apparently brought as an appeal to the court in its discretion to strike the subject pleading, as a motion to strike by the party would be untimely, as the answer here was filed on June 30, 2017.

The motion argues that Sun & Star Lighting, Inc. is a suspended corporation. The motion submits evidence from the Secretary of State Business Search Entity Detail showing that this entity as of January 10, 2020, had the status of “SOS SUSPENDED.” [Freed Decl. ¶ 3, Ex. 2].

““Corporations Code section 2205, subdivision (c) makes clear that, 'except for the purpose of amending the articles of incorporation to set forth a new name,' the suspended corporation may transact no business of any kind.” (Palm Valley Homeowners Assn., Inc. v. Design MTC, supra, 85 Cal.App.4th at p. 560.) Since “[c]onducting litigation is not 'amending the articles of incorporation to set forth a new name[,]' ” (ibid.) corporations that have been suspended for failing to file the requisite information statement are “disabled from participating in litigation activities.” (Id. at p. 556.)

Leasequip, Inc. v. Dapeer (2002, 2nd Dist.) 103 Cal.App.4th 394, 402.

However, it is recognized that the proper remedy for such an irregularity is not to strike the pleading or sustain a demurrer, but to stay the matter pending revival of the corporation. In Color-Vue v. Abrams (1996) 44 Cal.App. 4th 1599, 1605-1606, the Second District held that the trial court should have granted a continuance to permit the corporation to pay back taxes primarily because defendant had failed to raise the issue of the corporation’s suspension until trial, and so had waived the objection. The court held that this lack of capacity should have been raised at the earliest time, by, for example, demurrer. Color-Vue, at 1604.

The Second District in Timberline, Inc. v. Jaisinghani (1997) 54 Cal.App.4th 1361, 1365-66 has stated that if a corporation’s suspended status only comes to light during litigation, “the normal practice is for the trial court to permit a short continuance to enable the suspended corporation to effect reinstatement (by paying back taxes, interest and penalties) to defend itself in court.” Timberline, at 1366, citation omitted. The Second District emphasized that the purpose of the Revenue and Tax Code suspension provisions is to put pressure on corporations to pay taxes, and that this purpose is satisfied where tax delinquencies, once corrected, are treated as irregularities, with no further penalties. Timberline, at 1366.

There is no opposition here, so no indication that defendant has any interest in pursuing reinstatement. In addition, the motion argues that the court in a related case, LASC Case No. EC 065714, has already recognized that the corporate defendant has been suspended, and permitted a continuance since March of 2020 to effect reinstatement, when defendant has failed to take advantage of that period to do so. However, this is a distinct lawsuit, and, as noted above, it is not clear the client has been given notice of the pendency of this dispositive motion in this matter, and the court therefore continues the hearing for a reasonable period to permit defendant the opportunity to effect reinstatement

RULING:

[No Opposition].

Motion to be Relieved as Counsel is DENIED without prejudice. The Court is concerned that the “last known” address at which the client was served has not been confirmed as the current address, and will discuss the reasonable efforts made to confirm the address is current or locate a more current address, as required under CRC Rule 3.1362(d). If the client’s current address is not known, and reasonable efforts have been exhausted, the Court will consider whether service may be made by delivering notice and the papers to the clerk. CRC Rule 3.1362(d); CCP §1011.

Once the Order is complete, the court will sign the Order and counsel will be relieved effective upon the efiling of the proof of service of the signed order upon the client.

UNOPPOSED Motion to Strike Answer of Suspended Corporation Sun & Stars Lighting, Inc. is CONTINUED to February 19, 2021 to afford the defendant a reasonable time to be notified by counsel of the pendency of this motion and to effect reinstatement.

GIVEN THE CORONAVIRUS CRISIS, AND TO PROMOTE APPROPRIATE SOCIAL DISTANCING, UNTIL FURTHER ORDERED, DEPARTMENT D IS ENCOURAGING AUDIO OR VIDEO APPEARANCES

Please make arrangements in advance if you wish to appear via LACourtConnect by visiting www.lacourt.org, and scheduling a remote appearance. Please note that LACourtConnect offers an audio-only appearance option at a current cost of $15.00 and a video appearance option at a cost of $23.00. Counsel and parties (including self-represented litigants) are encouraged not to personally appear, unless they have obtained advance permission of the Court. Anyone who appears in person for the hearing will be required to comply with strict social distancing measures, including, but not limited to, assigned seating, capacity limitations in the courtroom, designated waiting areas, and strictly enforced spacing in line to communicate with court staff. If no appearance is set up through LACourtConnect, or otherwise, then the Court will assume the parties are submitting on the tentative.

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