North American Asbestos Corp. v. Superior Court

Petitioner, North American Asbestos Corporation, a dissolved Illinois corporation defending an action alleging injury from asbestos, challenges a ruling denying its motion for summary judgment. Petitioner had sought a determination that suit was barred because it was filed more than two years after dissolution of the corporation. Applying choice of law principles, we conclude that under California Corporations Code section 2010 the suit may be maintained.

California Corporations Code section 2010 provides that “[a] corporation which is dissolved nevertheless continues to exist for the purpose of winding up its affairs, prosecuting and defending actions by or against it . . . .’’It also provides that “[n]o action or proceeding to which a corporation is a party abates by the dissolution of the corporation or by reason of proceedings for winding up and dissolution thereof.” Under that section there is no time limitation for suing a dissolved corporation for injuries arising out of its predissolution activities (North American Asbestos Corp. v. Superior Court (1982) 128 Cal.App.3d 138, 143 [ 179 Cal.Rptr. 889 ]), other than the time prescribed by the applicable statute of…

I dissent. Corporations are creatures established under the authority of statute and exist only in accordance with the terms prescribed by statute. Four years ago, in North American Asbestos Corp. v. Superior Court (1982) 128 Cal.App.3d 138 [ 179 Cal.Rptr. 889 ] (North American I) this court stated that Corporations Code section 2010 applied only to domestic corporations. Then, as now, Corporations Code section 102 provided, with certain exceptions not applicable here, that the provisions of the Corporations Code apply only to domestic corporations and that application to other corporations is permitted only “to the extent expressly included in a particular provision of this division.” Then, as now, Corporations Code section 2010 made no mention of foreign corporations, which were the subject of the entire next chapter of the code. Then, as now, there was no constitutional prohibition against legislative favoritism toward foreign corporations.

In North American I, we noted: “It is clear that the California survival law does not apply to suits against dissolved foreign corporations. California Corporations Code section 2010 provides that ‘[a] corporation which is dissolved…

Karen Kahn, Steven Kazan, Bryce C. Anderson, Weltin & Van Dam, Robert S. Daggett, L. Christopher Vejnoska, Brobeck, Phleger & Harrison, Mark G. Bonino, Dorothy McArthur Landro and Ropers, Majeski, Kohn, Bentley & Wagner for Real Parties in Interest.

OPINION

MERRILL, J.

Petitioner, North American Asbestos Corporation, a dissolved Illinois corporation defending an action alleging injury from asbestos, challenges a ruling denying its motion for summary judgment. Petitioner had sought a determination that suit was barred because it was filed more than two years after dissolution of the corporation. Applying choice of law principles, we conclude that under California Corporations Code section 2010 the suit may be maintained.

California Corporations Code section 2010 provides that "[a] corporation which is dissolved nevertheless continues to exist for the purpose of winding up its affairs, prosecuting and defending actions by or against it...." It also provides that "[n]o action or proceeding to which a corporation is a party abates by the dissolution of the corporation or by reason of proceedings for winding up and dissolution thereof." (1) Under that section there is no time…