Opinion
B195951
7-1-2008
ZHICE XU, Plaintiff and Appellant, v. LOS ANGELES BIOMEDICAL RESEARCH INSTITUTE AT HARBOR-UCLA MEDICAL CENTER, Defendant and Respondent.
Law Office of Mark R. McKinniss, Mark R. McKinniss for Plaintiff and Appellant. Nossaman, Guthner, Knox & Elliott, E. George Joseph for Defendant and Respondent.
Not to be Published
In April 2004, appellant Zhice Xu lost his job with his employer, respondent Los Angeles Biomedical Research Institute at Harbor-UCLA Medical Center. Xu twice attempted to sue respondent for wrongful termination. On his second attempt, Xu sued respondent under its former corporate name. The trial court refused to allow Xu to amend his pleading to reflect respondents new name. It was an abuse of discretion to disallow a technical amendment to correct the name of a timely sued corporation. We reverse.
During Xus employment, respondent was incorporated as "Harbor-UCLA Research and Education Institute." Respondent restated its articles of incorporation in June 2004 to adopt its current, lengthy name. Respondent does not use its full corporate name when identifying itself on page one and on the cover of its appellate brief. Indeed, respondent has used a misnomer for itself throughout this litigation. In this appeal, we are using the name respondent officially adopted, not one that arbitrarily omits half of respondents new name.
FACTS
Appellants Employment Is Terminated
Xu was employed by respondent until April 30, 2004, working as a medical investigator. In a discrimination complaint presented to the California Department of Fair Employment and Housing, Xu wrote that he was terminated because he is Chinese. Xu received a "Right-To-Sue Notice" on April 18, 2005.
The First Lawsuit
On July 22, 2005, Xu filed a lawsuit for wrongful termination (the First Suit). The First Suit names as defendant "Research & Education Institute, Inc." On September 15, 2005, respondent demurred to the First Suit. The first sentence of respondents demurrer reads, "Los Angeles Biomedical Research Institute (erroneously named as defendant `Research & Education Institute, Inc.) . . . will move the Court for an order sustaining [its] demurrer to the complaint on file herein without leave to amend." While purporting to correct Xus error, respondent misstated its true name. The trial court sustained respondents demurrers with leave to amend. Xu did not amend the complaint. Instead, he voluntarily dismissed the First Suit on December 27, 2005.
The Second Lawsuit
On April 14, 2006, Xu filed a second lawsuit for wrongful termination (the Second Suit). The Second Suit names as defendant "Harbor-UCLA Research and Education Institute," which was, in fact, respondents correct name until June 2004. The statute of limitations on Xus claims elapsed on April 30, 2006. Xu served respondent with the summons and complaint on June 9, 2006.
Respondent appeared specially and moved to quash service of summons because it was not sued under its present corporate name. On August 2, 2006, Xu attempted to file a first amended complaint naming "Los Angeles Biomedical Research Institute" as defendant. Xu thus repeated the error respondent fostered in its demurrer to the First Suit, in which respondent misidentified itself.
Respondent demurred to the Second Suit, and asked the court to take judicial notice of the pleadings and papers filed in the First Suit. Respondent argued that Xus claims are time-barred because it was not sued under its correct corporate name before the statute of limitations elapsed. The court sustained respondents demurrers without leave to amend, and entered judgment in favor of respondent on October 13, 2006.
Xus Motion To Vacate The Judgment
On November 27, 2006, Xu filed a motion seeking relief pursuant to Code of Civil Procedure section 473. Xu listed several bases for relief. First, he asked for leave to file an amended complaint because the pleading contains a mere misnomer. Second, he sought relief based on attorney error. His attorney failed to sue respondent by its proper name within the statute of limitations period, leading to the demurrer and entry of judgment for respondent. Third, Xu asked the court to "set aside the voluntary dismissal" of the First Suit. The trial court denied Xus motion.
DISCUSSION
1. Timeliness Of The Appeal
Xu appeals from (1) the judgment of October 13, 2006, and (2) the postjudgment minute order of December 22, 2006, denying Xus motion for relief. The notice of appeal was filed on December 28, 2006. The judgment is appealable. (Code Civ. Proc., § 904.1, subd. (a)(1).) Appeal also lies from the order denying the motion to vacate the judgment under Code of Civil Procedure section 473. (Burnete v. La Casa Dana Apartments (2007) 148 Cal.App.4th 1262, 1265-1266.)
Respondent asks that the appeal be dismissed as untimely because it was filed more than 60 days after Xu was served with notice of entry of judgment. (Cal. Rules of Court, former rule 2(a).) The time for filing an appeal from a judgment is extended if "any party serves and files a valid notice of intention to move—or a valid motion—to vacate the judgment . . . ." (Id., former rule 3(a).) The time is extended until the earliest of the following dates: 30 days after the order denying the motion is served, or 90 days after the motion to vacate is filed, or 180 days after entry of judgment. (Ibid.) Here, the notice of appeal was filed six days after the court denied Xus motion, well within the 30 days authorized by the court rules.
We apply the rules in effect at the time Xu took his appeal in 2006.
Respondent contends that the extension authorized by former rule 3(a) is inapplicable because Xu did not file a "valid" motion to vacate the judgment. The Advisory Committee Comment to former rule 3 states that "the word `valid means only that the motion or notice complies with all procedural requirements; it does not mean that the motion or notice must also be substantively meritorious." (Wests Cal. Rules of Court (2006 rev. ed.) p. 27.) Respondent characterizes the motion to vacate as invalid because "the judgment was the result of the running of the statute of limitations," so no relief could be granted. Respondents argument addresses the substantive merits of Xus motion. Respondent does not point to any procedural defect in the motion, such as untimeliness or improper service. Because Xu pursued a procedurally valid motion to vacate, the period for filing an appeal was extended under former rule 3, and the appeal is timely.
2. Denial Of Request For Relief
The court "may, in furtherance of justice, and on any terms as may be proper, allow a party to amend any pleading or proceeding by . . . correcting a mistake in the name of a party . . . ." (Code Civ. Proc., § 473, subd. (a)(1).) This statutory provision receives "a very liberal interpretation by the courts of this state." (Klopstock v. Superior Court (1941) 17 Cal.2d 13, 19; J.C. Peacock, Inc. v. Hasko (1961) 196 Cal.App.2d 363, 366.) Amendments to the complaint are not allowed "when the result is the addition of a party who, up to the time of the proposed amendment, was neither a named nor a fictitiously designated party to the proceeding." (Ingram v. Superior Court (1979) 98 Cal.App.3d 483, 492.)
A new party cannot be added after the statute of limitations has elapsed, under the guise that there was a misnomer of the actual defendant. (Kerr-McGee Chemical Corp. v. Superior Court (1984) 160 Cal.App.3d 594, 599-600.) A plaintiff who sued "Trona Medical Clinic" cannot—after the statute of limitations has run—amend her complaint to sue "Kerr-McGee Chemical Corporation," which apparently operated the Trona Medical Clinic. The amendment "was nothing less than permitting the addition of a new party to replace a named party defendant," which is not authorized by law. (Id. at p. 599.)
The court in Kerr-McGee pointed out "the distinction between correcting an honest error in the name of a correctly named party and joining a new party in the litigation for the first time under the guise of a claim of misnomer." (160 Cal.App.3d at pp. 599-600, fn. 3.) Thus, the court permitted an amendment to the complaint by a plaintiff who sued his former employer for wrongful termination using the name "Basalite Corporation"—a name by which the employer conducted business dealings; even after the statute of limitations elapsed, the plaintiff could correct the defendants name, which was Pacific Coast Building Products, because the plaintiff was always attempting to sue his former employer but was unaware of the employers proper corporate name. (Hawkins v. Pacific Coast Bldg Products, Inc. (2004) 124 Cal.App.4th 1497, 1504-1505.)
In this case, Xu sued respondent under the name that respondent used while it employed Xu: Harbor-UCLA Research and Education Institute. This is not a fictitious name, a "dba," or a subsidiary. Respondent was incorporated under this name until June 2004. (See fn. 1, ante.) The parties have not cited us to any case in which a corporate defendant is sued by its correct former name.
"Generally, a change of corporate name does not make a new corporation, but only gives the corporation a new name. A change in the name of a corporation does not constitute a reorganization of the corporation, does not destroy the identity of the corporation, nor in any way affects the corporations rights and obligations. The change of a corporations name is not a change of its identity and has no effect on the corporations property, rights or liabilities, although it may have the effect of inducing additional averments in pleading in particular cases for the purpose of showing the identity of the corporation. [¶]. . . . The corporation continues, as before, responsible in its new name for all debts or other liabilities which it had previously contracted or incurred. . . . If the change of name takes place pending a suit against the corporation, it has no effect on the rights of plaintiff." (18 C.J.S. (2007) Corporations § 140, p. 439, fns. omitted, italics added; Mutual Bldg & Loan Assn. v. Corum (1934) 220 Cal. 282, 292 ["a change in name does not affect the identity of a corporation, although it may have the effect of requiring additional averments in pleading for the purpose of showing such identity"].)
"A mere change in the name of a corporation generally does not destroy the identity of the corporation, nor in any way affect its rights and liabilities. A change of name by a corporation has no more effect upon the identity of the corporation than a change of name by a natural person has upon the identity of such person. It is the same corporation with a different name. The nature and character of the corporation do not change, nor do the rights and liabilities of its shareholders. [¶] A corporation that has changed its name may act and conduct its business under the new name. If a corporation is identified by its old name, the misnomer does not render the transaction invalid. . . . A court may take judicial notice of a change in the name of a corporation; otherwise the identity of the corporation must be proven by sufficient evidence." (6 Fletcher Cyclopedia of the Law of Private Corporations (2005) § 2456, pp. 180-183, fns. omitted, italics added.)
As requested by respondent, we take judicial notice of the official records of the California Secretary of State, an executive department of this state. (Evid. Code, § 452, subd. (c); Rodas v. Spiegel (2001) 87 Cal.App.4th 513, 518.) A certified copy of the "Certificate of Amendment to Restated Articles of Incorporation" filed with the Secretary of State on June 23, 2004, states that Harbor-UCLA Research and Education Institute amends its articles of incorporation to read that its new name is Los Angeles Biomedical Research Institute at Harbor-UCLA Medical Center. This name change occurred after Xu was terminated by the named defendant, Harbor-UCLA Research and Education Institute.
Xu sued the entity that employed him and terminated him—Harbor-UCLA Research and Education Institute. Respondent and Harbor-UCLA Research and Education Institute are one and the same entity. Respondent incurred potential tort liability to Xu while operating under the corporate name Harbor-UCLA Research and Education Institute. Respondent cannot divest itself of the liabilities and obligations it incurred in the past merely by changing its name. It is the same corporation as before, with the same identity, the same type of business. Its change of name in no way affects plaintiffs rights or the corporations responsibilities. Respondent is not a "new party": respondent is the original defendant named in the Second Suit.
The Kerr-McGee case is inapposite. The plaintiff in that instance sued "Trona Medical Clinic" when the intended defendant was Kerr-McGee Chemical Corporation. Kerr-McGee was never incorporated under the name "Trona Medical Clinic." The plaintiff in Kerr-McGee mistakenly sued an entity that never existed as a corporation. By contrast, Xu sued a corporate entity that undisputedly did exist—Harbor-UCLA Research and Education Institute—and respondent undisputedly is that corporation, sporting a new moniker. Respondents restated articles of incorporation conclusively establish that Xus named defendant and respondent are one and the same entity.
"Whether an amendment to change the name of a party will be allowed depends on whether the mistake is merely a misnomer in the description of the party or `a substitution or entire change of parties." (Diliberti v. Stage Call Corp. (1992) 4 Cal.App.4th 1468, 1470.) The amendment here is a simple correction of a technical defect. In his complaint, Xu named as defendant the corporation that hired and fired him. That corporation is respondent. It is a mere technicality that respondent adopted a new name pending litigation, a technicality that changes absolutely nothing about respondents identity or liability. There is no proposed substitution of a "new party" or addition of "a stranger"; rather, there is simply a new name for an existing party. Even if respondent were a successor in interest to Harbor-UCLA Research and Education Institute, it could be held liable for damages under the old name. (Moe v. Transamerica Title Ins. Co. (1971) 21 Cal.App.3d 289, 303-305 [defendant Transamerica, "formerly known as" City Title Insurance Company, could be held liable for punitive damages assessed against City Title because "the two corporations are one and the same"].)
Under the circumstances, it was an abuse of discretion for the trial court to deny Xu the opportunity to exchange respondents old corporate name for its new corporate name. We reverse the postjudgment order denying respondents request for relief from the judgment and his request to amend his complaint to indicate respondents new name.
We need not reach the other grounds asserted by appellant for reversing the order, such as attorney fault.
3. Ruling On The Demurrer
Xu appeals from the judgment entered against him after the trial court sustained respondents demurrers without leave to amend, ostensibly because Xus claims are time-barred. We review the ruling on the demurrer de novo. (Desai v. Farmers Ins. Exchange (1996) 47 Cal.App.4th 1110, 1115.) As discussed in the preceding section, Xu sued the proper defendant. The original complaint in the Second Suit named respondent, under respondents true and correct former name. Though respondent adopted a new name, it is the same corporation. The lawsuit was timely filed against respondent within the statute of limitations. Any amendment to reflect respondents new name relates back to the filing of the original complaint in the Second Suit. Respondents demurrers were improperly sustained because Xus lawsuit was timely filed. Accordingly, the judgment must be reversed.
DISPOSITION
The judgment is reversed. The postjudgment order denying relief from the judgment is reversed. The denial of appellants request to amend his complaint to state respondents new corporate name is reversed. Respondent is to bear all costs on appeal.
We concur:
ASHMANN-GERST, J.
CHAVEZ, J.