Judge: Maurice A. Leiter, Case: BC693745, Date: 2023-05-19 Tentative Ruling

Case Number: BC693745    Hearing Date: May 19, 2023    Dept: 54

Hearing Date: May 19, 2023

Department 54, Judge Maurice A. Leiter

Motion to Amend Judgment

Moving Party: Defendant Salvatore Balsamo, Trustee, Balsamo Family Trust dated May 16, 1991, as Amended and Restated April 20, 2004, Sub-Trust B

Responding Party: None

T/R:     BALSAMO’S MOTION IS GRANTED AS TO AMAYA TIRE AND DENIED AS TO MARJORIE AMAYA.

BALSAMO TO NOTICE.

If the parties wish to submit on the tentative, please email the courtroom at¿SMCdept54@lacourt.org¿with notice to opposing counsel (or self-represented party) before 8:00 am on the day of the hearing.

The Court considers the moving papers. No opposition has been received.

            Defendant/Cross-Complainant Salvatore Balsamo moves to add Amaya Tire and Marjorie Amaya to the judgment entered against Victor Balsamo on September 10, 2019. Balsamo presents sufficient evidence showing Amaya Tire is the successor of Amaya’s sole proprietorship dba M.P. Tire.

A plaintiff may invoke Section 187 to seek the inclusion of a judgment debtor on a “successor corporation” theory. (McClellan v. Northridge Park Townhome Owners Ass'n, Inc. (2001) 89 Cal.App.4th 746, 753.) “The general rule of successor liability is that a corporation that purchases all of the assets of another corporation is not liable for the former corporation's liabilities unless, among other theories, the purchasing corporation is a mere continuation of the selling corporation. […] To be a mere continuation, California courts require evidence of one or both of the following factual elements: (1) a lack of adequate consideration for acquisition of the former corporation's assets to be made available to creditors, or (2) one or more persons were officers, directors, or shareholders of both corporations.” (Katzir's Floor and Home Design, Inc. v. M-MLS.com (2004) 394 F.3d 1143, 1150.)  

Amaya transferred his tire business to Marjorie in 2016, who then incorporated the business as Amaya Tire. Marjorie did not provide consideration for the business and Amaya Tire has not been properly capitalized. Balsamo represents that Amaya Tire has used all the same equipment, operated from the same location, and serviced the same customers as M.P. Tire. Balsamo has shown Amaya Tire is a continuation of M.P. Tire.

To add Marjorie as a judgment debtor Balsamo must show “by a preponderance of the evidence, that ‘(1) the parties to be added as judgment debtors had control of the underlying litigation and were virtually represented in that proceeding; (2) there is such a unity of interest and ownership that the separate personalities of the entity and the owners no longer exist; and (3) an inequitable result will follow if the acts are treated as those of the entity alone.’ “ (Favila v. Pasquarella (2021) 65 Cal.App.5th 934, 280 Cal. Rptr. 3d 425, 437, quoting Relentless Air Racing, LLC v. Airborne Turbine Ltd. Partnership (2013) 222 Cal.App.4th 811, 815-6.)

Balsamo has presented evidence tending to show Marjorie is an alter ego of Amaya Tire but fails to present evidence showing Marjorie had control of the underlying litigation and was virtually represented. The Court cannot add Marjorie as a judgment debtor.

Balsamo’s motion is GRANTED as to Amaya Tire and DENIED as to Marjorie Amaya.