Dow Jones & Co. v. Avenel

151 Cal. App. 3d 144, 198 Cal. Rptr. 457, 1984 Cal. App. LEXIS 1535
CourtCalifornia Court of Appeal
DecidedJanuary 25, 1984
DocketCiv. 53339
StatusPublished
Cited by30 cases

This text of 151 Cal. App. 3d 144 (Dow Jones & Co. v. Avenel) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dow Jones & Co. v. Avenel, 151 Cal. App. 3d 144, 198 Cal. Rptr. 457, 1984 Cal. App. LEXIS 1535 (Cal. Ct. App. 1984).

Opinions

[146]*146Opinion

HOLMDAHL, J.

This is an appeal from a judgment amending judgment, the amendment naming appellants as judgment debtors.

The judgment is affirmed.

Statement of Facts and Procedural History

Communimark, Inc. (hereafter Communimark), defendant below, is a California corporation which acts as an advertising media broker. Plaintiff and respondent Dow Jones Company, Inc. (hereafter, Dow Jones), is a corporation which furnished newspaper advertising services to Communimark between 1976-1980. The amount claimed on an open book account was $208,701.52. Dow Jones accepted a promissory note from Communimark for the value of the unpaid services.

Dow Jones, thereafter, filed suit on the account and note. Later, it filed a motion for summary judgment. The court granted the motion and awarded damages to Dow Jones in the amount of $208,701.52, plus interest.

Dow Jones then filed a motion to amend the judgment to include appellants Gerard Avenel, an individual, and Avenel Imports, Ltd., a corporation (hereafter, Avenel Imports), as judgment debtors. They were not parties to the original action. The basis of the motion was that appellants were the alter egos of Communimark. At the hearing on the motion, appellants presented documents and oral testimony on the issue of their alter ego liability for the actions of Communimark.

The court found that appellants had acted as the alter egos of Communimark. The court made findings of fact, among them the following: Gerard Avenel was the 100 percent shareholder, president, and chief executive officer of Communimark and the 100 percent shareholder, chief executive officer, and only director of Avenel Imports; he acquired the corporate stock of Communimark for no consideration whatsoever; Communimark incurred an indebtedness to Dow Jones of more than $200,000 during 1978; in 1976, Communimark acquired real property worth $320,000, which Gerard Avenel used as his personal residence and which was ultimately conveyed to him; he paid no rent on the premises in 1978 and 1979; during 1978, Communimark conveyed all of its “wholly paid office furniture, fixtures and equipment” to Avenel Imports for an unsecured promissory note and paid to Avenel Imports $115,000 within a period of 25 months; Gerard Avenel personally received $70,500 from Communimark, which payment was not [147]*147marked in the payroll books; accounts receivable of Communimark from Avenel Imports for 1978 and 1979 amounted to more than $150,000.

On the basis of these findings the court made several conclusions of law, including the following: The assets of Communimark were controlled and manipulated for the benefit of Gerard Avenel and Avenel Imports, resulting in a great loss to Communimark’s creditors; Gerard Avenel and Avenel Imports were the alter egos of Communimark; adherence to fiction and separate existence of Communimark, Gerard Avenel, and Avenel Imports would sanction a fraud and promote an injustice; Gerard Avenel and Avenel Imports were not entitled to a jury trial as a matter of right; and, the court had jurisdiction to grant the motion to amend judgment.

Accordingly, on May 7, 1981, the court amended its judgment to add appellants as judgment debtors. From that judgment, appellants filed a timely notice of appeal.

Issues

Appellants make three contentions. First, they claim that they were entitled to a jury trial on the issue of their alter ego liability. Second, they argue that the court was not empowered to amend the summary judgment. Finally, they contend that the amendment to the judgment, Including them as judgment debtors, denied them due process rights.

We consider these issues in order.

Right to a Jury Trial

Dow Jones’ motion to add judgment debtors was “based upon the grounds that the business affairs and activities and conduct of Communimark, Inc., Gerard Avenel, [and] Avenel Imports Ltd., a corporation, . . . are so commingled, intertwined and mixed that it is virtually impossible to separate the[ir] identities], [and] that . . . [they are] the alter ego of each other . . . .” The trial court’s findings and judgment essentially correspond to those allegations.

Appellants contend, however, that the trial court erred in finding that they were not entitled, as a matter of right, to litigate the issue of their alter ego liability before a jury.

It is well-settled that the alter ego doctrine is “essentially an equitable one and for that reason is particularly within the province of the trial court.” (Stark v. Coker (1942) 20 Cal.2d 839, 846 [129 P.2d 390].) Thus, the [148]*148“constitutional guaranty of the right to a jury trial does not apply to actions involving the application of equitable doctrines and the granting of relief that is obtainable only in courts of equity. Accordingly, a jury cannot be demanded as of right in such actions.” (41 Cal.Jur.3d, Jury, § 6, p. 24, fn. omitted.)

We conclude, therefore, that the trial court properly found that appellants “are not entitled as a matter of right to a jury trial.”

Amendment of Summary Judgment

Appellants’ second contention is that the trial court erred in amending the summary judgment. They argue that because a trial court may not make factual determinations at a summary judgment hearing, it should not be allowed “to make such determinations at a later motion and apply them retroactively to the previous stage of procedure. ” They claim that an amendment adding judgment debtors is available only after a “trial on the merits.”

It is true that a motion for summary judgment is an improper vehicle for resolving disputed issues of fact. (See generally, Wilkinson v. Norcal Mutual Ins. Co. (1979) 98 Cal.App.3d 307, 318 [159 Cal.Rptr. 416]; Leo F. Piazza Paving Co. v. Foundation Constructors, Inc. (1981) 128 Cal.App.3d 583, 589 [177 Cal.Rptr. 268].) Thus, the trial court here could not have determined the issue of appellants’ alter ego liability at the hearing on the motion for summary judgment, even if appellants had been named as defendants.

Dow Jones maintains, nonetheless, that a trial court may add a post-judgment debtor, pursuant to Code of Civil Procedure section 187,1 subject only to due process considerations.

We agree. A trial court has the authority to amend a judgment in order to add additional judgment debtors. Code of Civil Procedure section 187 has often served as,the basis for such an amendment of a judgment, pursuant to the alter ego doctrine. (E.g., see Alexander v. Abbey of the Chimes (1980) 104 Cal.App.3d 39, 44 [163 Cal.Rptr. 377]; Schoenberg v. Romike Properties (1967) 251 Cal.App.2d 154, 168 [59 Cal.Rptr. 359], See also 1 Witkin, Cal. Procedure (2d ed. 1970) Courts, §§ 123-124, pp. 392-394; 2 [149]*149Witkin, Cal. Procedure (2d ed. 1970) Actions, § 3, pp. 881-882, § 6, pp. 884-885.) And, the general rule is that “a court may amend its judgment at any time so that the judgment will properly designate the real defendants.” (Alexander v. Abbey of the Chimes, supra, 104 Cal.App.3d 39, 45.)

We perceive no reason to depart from that rule here. The appellants here were the real defendants.

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Bluebook (online)
151 Cal. App. 3d 144, 198 Cal. Rptr. 457, 1984 Cal. App. LEXIS 1535, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dow-jones-co-v-avenel-calctapp-1984.