UNITED STATES FIRE INSURANCE COMPANY v. JOHANSEN (1969)

OPINION UPON DENIAL OF PETITION FOR REHEARING of 76 Cal.Rptr. 174.

THE COURT:

In his petition for rehearing the defendant and respondent Johansen urges that prior to any retrial of this case the plaintiff and appellant United States Fire Insurance Company ‘should be ordered to sell the Slattebo assets and apply them to the existing judgment against the Slattebos.’ The argument made is that even if the United States Fire Insurance Company did not know prior to the first trial of this action that Boa Corporation was the alter ego of the Slattebos, in the light of the evidence adduced at that trial and the findings of fact of the trial court the United States Fire Insurance Company ‘must be charged since that time with the knowledge’ of the alter ego relationship. It is then argued that since the Slattebos are principals whose property should be first applied to the debt, the case should not be retried as against Johansen unless and until all property of the Slattebos against which there is a judgment lien has been sold under execution and the proceeds applied to Boa's debt. It is asserted that the evidence at the trial showed that ‘there should be enough proceeds from the sales to exonerate Boa's debts completely in which case the case against Johansen will be moot and a retrial unnecessary.’

As noted in our opinion, 76 Cal.Rptr. 174 (see footnote 3) the alter ego problem and the legal consequences relating thereto can be pursued in a plenary manner upon a retrial by the introduction of all relevant evidence then available. Moreover, it may be deemed advisable by appropriate procedure to seek to make Continental Casualty Company a party to the litigation so that there may be a plenary disposition of the matter of the respective rights and obligations of all interested persons. Accordingly, we do not undertake to determine on this appeal the merits of the position of the defendant and respondent Johansen so presented by him in his petition for rehearing.

The petition of the defendant and respondent Johansen for a rehearing is denied.