Lyon v. Carpenters' Hall Ass'n of San Francisco

California Court of Appeal Apr 16, 1924 No. Civ. No. 4738.Published

Before: Sturtevant

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Holding. The court held that a private individual cannot maintain an action to declare a corporation dissolved or to forfeit its charter, as such an action must be brought by the state. Furthermore, the plaintiff's allegation of dissolution was a mere legal conclusion insufficient to survive a demurrer.

Issues

Whether a private individual may maintain an action to quiet title based on the alleged dissolution and forfeiture of a corporation.
Whether the plaintiff's allegation that a corporation is 'dissolved and defunct' is a sufficient pleading of fact to survive a demurrer.

Disposition. affirmed

Quotations verified verbatim against the opinion

“In the absence of a statute to the contrary, it is the settled law of California that the state only is entitled to maintain an action to have it adjudged that a forfeiture has occurred and to enforce such forfeiture.”

“The corporation continues to exist until the sovereignty which created it shall, by proper proceedings in a proper court, procure an adjudication of forfeiture, and enforce it.”

“Being of such importance the pleader should have alleged the facts and not his conclusion, and it is but his conclusion under such circumstances.”

STURTEVANT, J.

The plaintiff commenced an action against the defendants to quiet title to his alleged interest in

[551]

certain real estate located in San Francisco, California. The defendants interposed demurrers which the trial court sustained, without leave to amend, and judgment was entered dismissing the action. From that judgment the plaintiff appeals, bringing up the judgment-roll.

In his complaint the plaintiff alleges that prior to October 25, 1921, Carpenters’ Hall Association was a corporation without capital stock, existing under the laws of the state of California; that Local Union 483, Carpenters of San Francisco, and Local Union 1082, Carpenters of San Francisco, were unincorporated associations, and on the twenty-fourth day of October, 1921, those two associations were expelled from the United Brotherhood of Carpenters and Joiners of America and were disbanded and ceased to exist; that Local Union 304, Carpenters of San Francisco and Local Union '616, Carpenters of San Francisco, were unincorporated associations, and prior to October 24, 1921, they disbanded and ceased to exist; that it is provided in the by-laws of said Carpenters’ Hall Association of San Francisco that membership therein shall consist only of members in good standing of the unincorporated associations above mentioned, and that anyone ceasing to be a member of any unincorporated association shall thereupon cease to be a member of said Carpenters’ Hall Association of San Francisco; that prior to the twenty-fourth day of October, 1921, the plaintiff was a member of Local Union 483, Carpenters of San Francisco, and a member of Carpenters’ Hall Association of San Francisco. It is also alleged “That there are now no members of Carpenters’ Hall Association, or any person, or persons, qualified to be members of said Carpenters’ Hall Association of San Francisco, and the said corporation is dissolved and defunct.” In appropriate language it is alleged that at the time of the dissolution Carpenters’ Hall Association owned real estate, describing it by metes and bounds; that it also owned other properties the exact nature of which are unknown to the plaintiff; that the plaintiff is a

pro rata

owner of such assets; and by proper averment it is alleged that the individuals named as defendants were at the time of the dissolution the duly elected and acting officers.

Lyon v. Carpenters' Hall Ass'n of San Francisco

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STURTEVANT, J.

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