Breach of contract
action. Company X is in CA, and is "converted" from Company Y in DE. I was sued by Company X, based on agreement I had signed with Company Y.
According to CA Code 17540.8 d), in order for the conversion to be perfected, the converting company must follow the procedures for conversion in the original state of DE. In DE, in order for a conversion to be effective and for the Company in DE to cease to exist, DE code 266 specifies how to perform this.
Company X/Y failed to perform steps in DE to close company in DE, which thus invalidates Company CA as a converted company. Is this correct? In effect both companies now currently exist? They both can be found in their respective state registries.
The reason I'm asking is because we're asking to dismiss action due to lack of legal standing of CA company to sue on behalf of an agreement with DE company. I recognize it's a legal/procedural technicality.
- how likely are courts to enforce such considerations
, by following the procedures required by law vs the 'spirit' of the relationship between the two companies?
- if they do pay heed to these considerations, would they stay the action until the paperwork is processed, or dismiss and demand a refile?