In re All Cases Against Sager Corp.
132 Ohio St. 3d 5
Ohio2012Background
- Sager Corporation, an Illinois company, dissolved in 1998 and entered a five-year post-dissolution window for claims under Illinois law; that window ended June 17, 2003.
- In 2007–2008, asbestos claimants filed Ohio suits against Sager and others; Sager moved for summary judgment arguing it was no longer amenable to suit due to dissolution.
- Bevan & Associates sought appointment of a receiver in Ohio to wind up Sager’s affairs and marshal assets, including unexhausted liability-insurance policies.
- Trial court appointed a receiver under R.C. 1701.88(B) to accept process and marshal assets; appellate court affirmed under R.C. 2735.01(E).
- Ohio Supreme Court reversed, holding that a dissolved foreign corporation is not amenable to suit in Ohio and that unexhausted insurance proceeds are not assets subject to receivership absent a judgment; Full Faith and Credit requires applying the law of the state of incorporation (Illinois).
- The court concluded Illinois five-year survival statute governs claims against the dissolved Illinois corporation and barred claims filed after June 17, 2003; the receiver cannot accept service or marshal insurance assets for a dissolved foreign corporation in Ohio.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Ohio may appoint a receiver for a dissolved foreign corporation. | Sager argues Ohio lacks jurisdiction; receivership should not resurrect a dissolved entity. | Claimants rely on R.C. 2735.01(E); central issue is to marshal assets including insurance. | No; court reverses, receiver not authorized. |
| Whether Illinois’ five-year survival statute bars claims after dissolution. | Claimants rely on conflict-of-laws to apply Ohio injury location; seek recovery from policies. | Illinois law governs amenability to suit; later claims barred by Illinois statute. | Yes; Illinois statute bars claims filed after dissolution. |
| What law governs the capacity to sue of a dissolved foreign corporation? | Capacity determined by Ohio conflict-of-laws analysis per Ohayon and Restatement; Ohio should apply to tort claims. | Capacity determined by state of incorporation; full faith and credit requires applying incorporation law. | State of incorporation governs capacity to sue. |
| Does R.C. 1701.88(B) authorize appointing a receiver for a foreign corporation to marshal assets? | Receiver could collect insurance proceeds to satisfy Ohio claims. | Such authority is limited; assets like insurance policies are not assets of a dissolved foreign corporation. | Not authorized; confers no power to marshal unexhausted insurance assets. |
Key Cases Cited
- Ohayon v. Safeco Ins. Co. of Illinois, 91 Ohio St.3d 474 (2001) (conflict-of-laws/amenability analysis in tort claims against dissolved entities)
- Chicago Title & Trust Co. v. Forty-One Thirty-Six Wilcox Bldg. Corp., 302 U.S. 120 (1937) (state may terminate corporate existence; survival statute governs capacity to sue)
- CTS Corp. v. Dynamics Corp. of Am., 481 U.S. 69 (1987) (state's power to regulate domestic corporations; full faith and credit principle)
- Oklahoma Natural Gas Co. v. Oklahoma, 273 U.S. 257 (1927) (full faith and credit; corporate life tied to state law creating it)
- In re Texas E. Overseas, Inc., 2009 WL 4270799 (Del. Chancery (not official reporter)) (Del. Chancery on receiver for dissolved entity (cited for policy rationale))
- Marsh v. Rosenbloom, 499 F.3d 165 (2d Cir. 2007) (recognizes survival statutes influencing post-dissolution claims)