In re Marjus
Filed 7/6/06 In re Marjus CA2/8
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
| In re MARJUS, INCORPORATED, In Voluntary Dissolution. | B179793 (Los Angeles County Super. Ct. No. BS087416) |
| MARJUS, INCORPORATED, Petitioner and Respondent, v. EUGENE D. TAVRIS, Objector and Appellant; SAMUEL S. MATELSON, Claimant and Respondent. |
APPEAL from an order of the Superior Court of Los Angeles County.
David P. Yaffe, Judge. Affirmed.
Eugene D. Tavris, in pro. per., for Objector and Appellant.
L. Morris Dennis; Benedon & Serlin, Gerald M. Serlin and Douglas G. Benedon for Petitioner and Respondent.
Lewitt, Hackman, Shapiro, Marshall & Harlan, Barry T. Harlan and Vanessa Soto for Claimant and Respondent.
Eugene D. Tavris, an attorney appearing in pro. per., appeals from an order for court supervision of the voluntary winding up of Marjus, Incorporated (Marjus), a family corporation, insofar as the order provides for distribution of Marjus's assets on the basis that its president, Samuel S. Matelson, owns 542.5 shares of Marjus's stock, rather than 292.5 shares, and allows him to retain dividends associated with the 250 shares comprising the difference. We find no error in the trial court's determinations, and affirm.
FACTS
Marjus petitioned the superior court, under Corporations Code section 1904, for judicial supervision of Marjus's voluntary winding up. The petition alleged that winding up was ongoing, but jurisdiction was required to resolve shareholder differences of opinion as to (1) whether Marjus remained indebted under a note that it contended had been paid off, and (2) whether the number of corporate shares, and their respective ownership, were as Marjus alleged. In this regard, the petition alleged that there were 1,484 outstanding shares, owned by six shareholders, the largest block (542.5) being held by company president Samuel Matelson, and the next largest by appellant Tavris (297.5).[1] The petition prayed court resolution of these issues, favorable to Marjus's contentions, and that the court then make an order for winding up and dissolution.
Marjus also filed a declaration by Matelson, addressing both issues.[2] In paragraph 7 of the declaration, Matelson described the history of Marjus's stock issuance from incorporation in 1947 until 1949. In paragraph 8, he described the origin of the 250 of his shares that were in contest. According to Matelson, beginning in 1948 he had performed about three-quarters of the labor that was required for Marjus's construction of a new commercial building. As reflected in attached corporate minutes, Marjus's directors initially voted to compensate him with corporate notes, bearing five percent interest. Those notes were not issued, however. Instead, Ralph Matelson, who managed Marjus from 1947 until his death in 1997, proposed that Matelson receive 250 shares of stock. The other shareholders agreed – informally, as the company's affairs were then conducted – and Matelson also agreed (although the shares' value would be less than that of his work). The stock was not issued until 1998, when Matelson requested it be issued. An attached resolution of Marjus' board formally ratified the earlier agreement and authorized issuance of the stock.
The court issued an order to show cause (o.s.c.) on the petition, which was served on Marjus, its shareholders, and another interested party. Tavris filed a response in the nature of an answer, accompanied by points and authorities. Although admitting much of the petition, he alleged that Matelson owned only 292.5 shares of Marjus, and that its total shares outstanding were commensurately fewer. Addressing the particulars of Matelson's declaration, Tavris denied that there had been an agreement for Matelson to be compensated with 250 shares, but he admitted that the shares had been issued, following the 1998 resolution. Tavris also objected to the petition's request that factual issues be resolved primarily by declarations; he contended that they should be tried by live testimony. He agreed that the court should assume jurisdiction to decide the stock question.
In his points and authorities, Tavris acknowledged that corporate stock may be issued as consideration for work done (Corp. Code, § 409, subd. (a)(1)), but he contended that Matelson's claimed 250 shares had been improperly authorized, by informal procedures. He also argued that Matelson had been guilty of laches in claiming the stock.
Marjus filed a memorandum in response to Tavris's response, taking issue with his legal contentions and noting that he had presented no evidence contradicting Marjus's position. The court then granted the petition and assumed jurisdiction. It directed various steps, including that Marjus file a proposed distribution plan for its assets, after liquidation and deposit in court. An o.s.c. would then issue to interested persons, who could file claims to specific sums, which would be heard. The court reserved deciding the manner of hearing the claims until they were filed.
Marjus proceeded to file a petition for distribution of its assets, according to the number of shares originally propounded. The total assets available for distribution were $687,556, or about $463.31 per share. On application, the court granted and issued an o.s.c., providing that those claiming entitlement to more than the distribution plan could file claims. A hearing was set for August 24, 2004.
Tavris filed a reply to the o.s.c. As relevant, he first alleged that he had requested copies of all of Marjus's corporate records, but had received only those from 1995 through 2002, as well as a spreadsheet for 2003. Marjus's attorney had informed Tavris that prior financial records had been lost. Without complete records, Tavris alleged, he could not respond to the o.s.c.'s statement of assets available for distribution. Nor could he specify the sum he claimed, as the o.s.c. required. Again disputing Matelson's entitlement to 250 shares, Tavris alleged that he was entitled to 24.11 percent of the corporate proceeds, as contrasted with the 20.05 percent propounded by Marjus. He also restated his demand for a formal evidentiary hearing. In accompanying points and authorities, Tavris charged culpability or deception in the claimed loss of corporate records, and argued that negative inferences should be drawn.
A few weeks later, Matelson filed a declaration, â€
