Judge: Frank M. Tavelman, Case: 24BBCP00021, Date: 2024-03-08 Tentative Ruling

Case Number: 24BBCP00021    Hearing Date: March 8, 2024    Dept: A

LOS ANGELES SUPERIOR COURT

NORTH CENTRAL DISTRICT - BURBANK

DEPARTMENT A

PETITION TO REINSTATE LLC

NOTICE:

The Court is not requesting oral argument on this matter.  Pursuant to California Rules of Court, Rule 3.1308(a)(1) notice of intent to appear is required.  Unless the Court directs argument in the Tentative Ruling, no argument will be permitted unless a “party notifies all other parties and the court by 4:00 p.m. on the court day before the hearing of the party’s intention to appear and argue.  The tentative ruling will become the ruling of the court if no notice of intent to appear is received.”  

Notice may be given either by email at BurDeptA@LACourt.org or by telephone at (818) 260-8412.

ALLEGATIONS:

Before the Court is a petition made by Karo Papazyan (Petitioner) to reinstate Blue Sky Hospice Care, Inc. (Blue Sky) to active corporate entity status. The petition is unopposed.

ANALYSIS:

I.            LEGAL STANDARD

The Secretary of State shall reinstate to active status on its records, a business entity for which a court finds any of the following: (1) The factual representations by a shareholder, member, partner, or other person that are contained in the termination document are materially false, or (2) the submission of the termination document to the Secretary of State for filing is fraudulent. (Gov. Code § 12261 (a).)

Termination Document means the certificate or other document required by the Corporations Code that is the last certificate or document filed with the Secretary of State to effect the final dissolution, surrender, or cancellation of the business entity. (Gov. Code § 12260.)

If a court of competent jurisdiction orders reinstatement of a business entity to active status on any of the grounds stated in paragraph (1) or (2) of subdivision (a), the order for reinstatement shall state all of the following: (1) The specific grounds for reinstatement., (2) that if there is a conflict with the entity name [and various code sections]…the reinstatement shall be conditioned upon the business entity concurrently submitting for filing an amendment to change its name to eliminate the conflict along with the certified copy of the order required by Section 12263, and (3) that the business entity shall be reinstated effective from the date of the filing of the court order with the Secretary of State. (Gov. Code § 12261(b).)

The court order for reinstatement may be obtained by submitting a petition to the superior court containing the legal and factual basis for reinstatement or as part of a civil action for damages or equitable relief. The Secretary of State shall not be made a party to the proceeding. (Gov. Code § 12261(c).)

II.            MERITS

Petitioner states that he is the sole owner of Blue Sky and has operated the business since May 19, 2020. (Papzyan Decl. ¶ 1.) Plaintiff attaches the article of incorporation for Blue Sky which evidence the same. (Papzyan Decl. Exhs. A & B.) Petitioner states that between May and July of 2023, he was considering selling the assets of the business to a third party and dissolving the company. (Papzyan Decl. ¶ 3.) In preparation for this sale, Petitioner has his accountant, Ara Kassabian (Kassabian), prepare a number of dissolution documents. (Papzyan Decl. ¶ 5, Kassabian Decl. ¶ 4.) While the sale of the company’s assets never came to pass, Kassabian’s staff inadvertently filed a Certificate of Dissolution for Blue Sky. (Kassabian Decl. ¶ 6.) Consequently, the Secretary of State dissolved the business. (Kassabian Decl. ¶ 6.)

The Court is satisfied that Petitioner has shown the terminating document was submitted fraudulently within the meaning of Gov. Code § 12260. While not fraud in the most common sense, the legislative history reveals that an inadvertent filing qualifies for relief under the statute. “The Secretary of State reports that the situation arises where a business will claim that it has been terminated wrongfully; that is, the filer of the termination document was not acting on behalf of the business.” (California Bill Analysis, A.B. 2588 Assem., 4/26/2006 [emphasis added].) Here, the Certificate of Dissolution was filed by Kassabian’s staff without authorization and contrary to the interest of the business.

Accordingly, the petition for reinstatement is GRANTED. Blue Sky Hospice Care, Inc. shall be reinstated effective from the date of the filing of this order with the Secretary of State.

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RULING:

In the event the parties request a signed order or the court in its discretion elects to sign a formal order, the following form will be either electronically signed or signed in hard copy and entered into the court’s records. 

ORDER

Karo Papazyan’s Petition to Reinstate came on regularly for hearing on March 8, 2024 with appearances/submissions as noted in the minute order for said hearing, and the Court, being fully advised in the premises, did then and there rule as follows: 

THE PETITION TO REINSTATE BLUE SKY HOSPICE CARE, INC. TO ACTIVE STATUS IS GRANTED.

BLUE SKY HOSPICE CARE, INC. SHALL BE REINSTATED EFFECTIVE FROM THE DATE OF THE FILING OF THIS ORDER WITH HE SECRETARY OF STATE.

IT IS SO ORDERED.