Misik v. D'Arco
197 Cal. App. 4th 1065
| Cal. Ct. App. | 2011Background
- Misik lent $150,000 to Sayrahan Group, LLC, with D’Arco signing the notes as Sayrahan’s CEO.
- Misik later obtained a breach-of-contract judgment against Sayrahan for $150,000 plus interest; D’Arco was not found liable for fraud.
- Misik moved to amend the judgment to add D’Arco as a judgment debtor on an alter ego theory.
- The trial court denied the motion, apparently on the belief CCP 187 did not authorize amendments post-judgment.
- The appellate court held CCP 187 authorizes amendments to add an alter ego as a judgment debtor and remanded for factual determination on alter ego elements.
- The opinion discusses unity of interest/ownership and whether preserving the corporate separate existence would promote injustice, emphasizing control of litigation and absence of required fraud.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CCP 187 allows amending a judgment to add an alter ego as a judgment debtor | Misik: statute authorizes amendments to designate the real party | Sayrahan/Arco: no amendment permitted post-judgment | Yes, trial court must allow amendment and determine alter ego facts |
| Whether the evidence supports D’Arco as Sayrahan’s alter ego | Unity of interest and injustice justify piercing | Record insufficient to show unity or injustice | Remand for trial court to assess the elements with substantial evidence |
| Whether mispleading the alter ego issue in the underlying suit bars amendment | Pleading not required for amendment under CCP 187 | Preclusion due to procedural posture | No preclusion; court may amend post-judgment |
| Whether D’Arco controlled the litigation and can be held liable under the judgment | D’Arco acted as representative and controlled defense | No clear evidence of control | Evidence supports finding of control; remand for factual determination |
Key Cases Cited
- Postal Instant Press, Inc. v. Kaswa Corp., 162 Cal.App.4th 1510 (Cal.App.4th 2008) ( CCP 187 authorizes adding judgment debtors under alter ego theory)
- Claremont Press Pub. Co. v. Barksdale, 187 Cal.App.2d 813 (Cal.App.2d 1960) (alter ego when adherence to corporate fiction would promote injustice)
- NEC Electronics Inc. v. Hurt, 208 Cal.App.3d 772 (Cal.App.3d 1989) (alter ego and control of litigation supports liability)
- Greenspan v. LADT LLC, 191 Cal.App.4th 486 (Cal.App.4th 2010) (liberality in amending judgments under CCP 187)
- Alexander v. Abbey of the Chimes, 104 Cal.App.3d 39 (Cal.App.3d 1980) (alter ego inquiry is primarily factual and reviewed for substantial evidence)
- Leek v. Cooper, 194 Cal.App.4th 399 (Cal.App.4th 2011) ( CCP 187 remedy available after judgment)