Ross A. Wilson v. Louisiana Pacific Resources, Inc.

138 Cal.App.3d 216 (1982)

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Nature of the Case

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Facts

P sought a declaratory judgment that D met the tests of section 2115 and that he was therefore entitled to cumulative voting in accordance with section 708. The trial court found that in the years preceding the action, the average of the defendant's property, payroll, and sales in California as defined by the California corporation statute exceeded 50 percent, and that more than 50 percent of its shareholders entitled to vote resided in California, so that the statutory conditions had been met. It also found that except for being domiciled in Utah and having a transfer agent there, D had virtually no business connection with Utah, that its principal place of business has been in California since at least 1971, that its meetings of shareholders and directors are held in California, and that all of its employees and all of its bank accounts are in California. The court concluded that there existed no constitutional obstacle to the application of the cumulative voting requirement to D. D appealed from this judgment, challenging the trial court's finding that the statutory criterion with respect to shareholder residency had been met and renewing its constitutional challenges as well. During the pendency of the appeal, the California Corporations Commissioner certified the Pacific Stock Exchange, upon which D's securities are listed, under subdivision (o) of section 25100. This action made section 2115 inapplicable to D. Both parties strenuously urge us, however, to decide the constitutional issues presented, since there appear to be no published decisions on the constitutionality of section 2115.