1

Filed 5/20/15 Poppin v. Cresson CA1/5 

NOT TO BE PUBLISHED IN OFFICIAL REPORTS 

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for 

publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication 

or ordered published for purposes of rule 8.1115. 

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA 

FIRST APPELLATE DISTRICT 

DIVISION FIVE 

JOHN POPPIN, 

 Plaintiff and Respondent, 

v. 

GEORGE V. CRESSON, 

 Defendant and Appellant. 

 A139918 

 (San Francisco City and County 

 Super. Ct. No. CGC-10-501077) 

 John Poppin provided legal services to Infill Community Partners, LP (Infill) in a 

bankruptcy proceeding. George V. Cresson signed a payment guaranty for Poppin’s fees 

as “president” of Cresson Development Company (CDC), a corporation. At the time of 

the guaranty, unknown to Poppin, CDC’s corporate powers had long been suspended. 

When Poppin’s fees went unpaid, he sued Cresson individually on the guaranty, alleging 

Cresson was liable as CDC’s alter ego. After a bench trial, the trial court ruled in 

Poppin’s favor and awarded judgment against Cresson.1

 We affirm. 

I. BACKGROUND

 Infill, a real estate investment firm, retained Poppin to represent it in a Chapter 11 

bankruptcy proceeding in March 2003. The sole general partner of Infill was 

Winterspring Structures LLC (Winterspring), and the managers of Winterspring were 

CDC and a trust controlled by Peter M. Radin, Jr. Cresson was the president of CDC. 

 1

 Cresson represented himself in the trial court and continues to represent himself 

on appeal. 
2

Poppin drafted a fee agreement, as well as an “Agreement of Winterspring, Radin and 

Cresson to Pay Attorneys and Experts and Consultants” in relation to Poppin’s 

representation of Infill (Guaranty). The Guaranty called for Cresson’s signature (as 

president of CDC on behalf of both Winterspring and CDC) and for Radin’s signature. 

Poppin asked Cresson to personally guarantee payment of his fees (including costs), but 

Cresson refused and told Poppin, “ ‘[D]on’t worry about it. [CDC] is good for it.’ ” 

Poppin accepted Cresson’s representation and made no personal investigation into CDC. 

In fact, CDC, an Oregon corporation, had been “administratively dissolved” in Oregon in 

2000 for failure to file its annual report or pay its annual fee, and it was still inactive as of 

2013.2

 CDC had also forfeited its right to do business in California in 2002, and those 

rights were still forfeited as of 2013. 

 Poppin testified that “[Radin] was primarily in charge of the monetary aspects of 

this case, and [Cresson was] in charge of the development of the land rights, the water 

rights, the CEQA problems and all of that.” Radin negotiated the terms of the fee 

agreement and Guaranty, delivered the signed agreements to Poppin, and paid the retainer 

and subsequent legal bills on behalf of Infill (through his trust). Radin and Cresson 

expressed satisfaction with the quality of Poppin’s legal representation. Infill, however, 

was unable to reorganize in the bankruptcy proceeding. Poppin was not paid after 

December 2007. He was granted permission by the bankruptcy court to withdraw as 

Infill’s counsel in April 2008. The outstanding balance on Poppin’s final invoice was 

$70,634.30, an amount still owed at the time of trial. 

A. Lawsuit

 In June 2010, Poppin sued Cresson, Radin and Infill for breach of contract.3

 In the 

operative third amended complaint, Poppin asserted causes of action for breach of 

 2

 CDC was formed as an Oregon corporation on October 4, 1995, administratively 

dissolved in Oregon on November 25, 1999, reinstated on January 5, 2000, and again 

administratively dissolved on November 30, 2000. 

3

 Because only Cresson is party to this appeal, Poppin’s claims against Radin and 

Infill are not discussed. 
3

contract and “Common Counts,” which included claims for open book account, account 

stated, and quantum meruit. Poppin alleged that Cresson was personally liable under the 

Guaranty as the alter ego of CDC. Under the heading, “Piercing the Corporate Veil,” he 

alleged that CDC failed to observe corporate formalities, issue shares, hold director or 

shareholder meetings, or keep minutes; Cresson commingled personal assets with 

corporate assets; CDC was insolvent; and Cresson made several intentional and negligent 

misrepresentations. Specifically, it was alleged that “[e]xecution of the written guaranty 

by [Cresson] on behalf of [CDC] constituted a misrepresentation that [CDC] was a 

corporation in good standing, and had capital and other assets adequate to meet the 

obligation that [Cresson] was taking on in its name. [¶] . . . When [Cresson] executed the 

[Guaranty], . . . he knew that [CDC] had forfeited its right to do business in California 

and Oregon, and had been involuntarily dissolved by the State of Oregon, but failed to 

disclose these material matters to [Poppin]. . . . [¶] . . . [Cresson also] knew that [CDC] 

was insolvent and lacked assets with which to pay the obligations he was assuming on 

behalf of [CDC], but failed to disclose these material matters to [Poppin]. Had [Poppin] 

known . . . , he would never have accepted a guaranty purportedly made on behalf of 

[CDC], and would not have provided the services which are the subject of this 

Complaint.” 

B. Discovery 

 Poppin conducted discovery on the alter ego issue. Records obtained from the 

California Secretary of State showed that Cresson identified himself as CDC’s chief 

executive officer and agent for service of process as of 1995, 1996, and 2000. A 1996 

filing identified David Cresson (Cresson’s brother) as CDC’s corporate secretary and 

Robert Kulda as its chief financial officer. Cresson listed an address on Purissima Street 

in Half Moon Bay for each of the officers and for the corporation. Records obtained 

from the Oregon Secretary of State showed that as of November 30, 2000, Cresson was 

identified as president and David Cresson was listed as secretary of the corporation, with 

both officers sharing an address on Main Street in Half Moon Bay. 
4

 In requests for admissions, Poppin asked Cresson to admit that CDC held no board 

of director or shareholder meetings, kept no minutes, issued no shares, failed to make 

required filings and fee or tax payments to state governments, and commingled its assets 

with Cresson’s personal assets. Cresson denied all of the requests. Through form 

interrogatories, Poppin asked Cresson to explain his denials to the requests for admission. 

Cresson wrote that, at the time he signed the Guaranty, CDC “was not grossly 

undercapitalized,” its liabilities did not exceed its assets, and it was able to meet the 

obligations it incurred; all required corporate formalities were observed; and CDC and 

Cresson did not commingle personal and corporate assets. He did not recall when CDC 

ceased doing business. The form interrogatories asked Cresson to identify persons with 

knowledge of facts related to the denials and documents that supported the denials. 

Cresson identified no such persons or documents. 

 Poppin asked Cresson to bring to his deposition CDC’s articles of incorporation, 

bylaws, corporate minutes, bank account statements, financial statements, tax returns, 

stock records, and notices received from government agencies. Cresson brought none of 

these documents. He testified, “First, let me object based on the privacy of these 

documents. [CDC] is not a named defendant. And having said that, I don’t have any of 

these documents. [¶] . . . [¶] . . . I’m sure most of them are quite old and date back from 

years and years and years ago. I don’t have them, if I ever did have them.” He testified 

that he made a diligent search of the offices he controlled and did not find any CDC 

documents. “I did not check any sources other than what I control.” He did not ask his 

brother, David Cresson, where the documents were because “I didn’t even recall that he 

was the secretary,” and “[h]e may not have been the secretary by the time this business 

stopped doing business.” 

 Cresson testified at the deposition that he was CDC’s president at some point, but 

he could not recall whether he was president when CDC was first formed. He did not 

recall whether he ever received notices from the States of Oregon and California that 

CDC’s corporate status was administratively dissolved or that its right to do business had 

been forfeited. He did not recall whether CDC paid any or all of its taxes. He did not 
5

know whether CDC issued stock and did not believe he ever owned CDC stock. He did 

not know where CDC’s financial statements were or whether they still existed. He 

acknowledged that the Cresson name was used in CDC because various members of his 

family were involved with the company. The discovery requests and responses were 

admitted in evidence at trial. 

C. Motions in Limine and Bench Trial 

 Poppin filed motions in limine asking the court to exclude evidence of CDC’s 

separate existence as a discovery sanction and asking the court to rule as a matter of law 

that Cresson was CDC’s alter ego. The court heard pretrial argument on these issues, but 

made no rulings until after trial. Cresson argued pretrial that the action against him 

should be dismissed because CDC was an indispensable party and had not been named as 

a defendant. The court rejected this argument. 

 The case, initially slated for jury trial, ultimately was tried to the court. On the 

alter ego issue, Cresson testified that he was president of CDC, but never served in any 

other office, “never [was] the responsible managing officer,” and “never held a majority 

position.”4

 He presented a printout from the Contractors State License Board showing 

that CDC was a licensed general contractor, Robert Kulda was the responsible managing 

officer of CDC, and CDC had no record of discipline.5 “[H]aving been in business for 

many years, . . . [CDC] never was sued, never had a lawsuit resulting in a judgment, 

always paid its bills.” 

 Cresson further testified, “[W]ith respect to the guaranty, I never should have 

signed that. That was a mistake to have ever signed it, given the corporate status of 

[CDC]. Very embarrassing. . . . It was not done in bad faith. I was not trying to trick 

anybody.” He was “[c]ompletely unaware” at that time that CDC was not in good 

corporate standing. “I don’t have a great explanation for it other than carelessness. But I 

 4

 The court allowed Cresson to testify in narrative form and to combine his factual 

testimony with his legal arguments. 

5

 In his 1996 “Statement by Foreign Corporation,” filed with the California 

Secretary of State, Cresson identified the business of CDC as “Real Estate Investments.” 
6

don’t think . . . there’s any other fact that would stand for the proposition that [CDC] was 

. . . a mere shell or instrumentality.” At the time Cresson signed the Guaranty, CDC was 

in a position to cover the $75,000 legal bill that had been projected by Poppin in his 

discussions with Cresson, and in an even better position to cover half of that bill, which 

was its contemplated obligation. However, the total fees far exceeded the original 

projection. 

 Cresson testified that he ceased being actively involved in CDC in 2004 or early 

2005. “Although I did not formally disassociate from [CDC], Robert Kulda took over 

[CDC]— . . . took all of its contracts and took over the banking. . . . [¶] . . . [¶] . . . I 

handed off that company to Robert Kulda.” 

 In June 2005, a controversy apparently arose about Cresson’s liability under the 

Guaranty. Cresson did not remember signing the Guaranty until he reviewed a copy of it 

and saw his signature on behalf of CDC. Cresson promptly informed Poppin by email 

(with a copy to Radin): “We need to alter the engagement letter to reflect that [CDC] is a 

now [a] defunct entity.” Poppin replied, “How do you suggest that we change the 

Agreement?” Cresson did not respond. Radin replied to Cresson, “[A]lter it how . . . to 

add you as an individual?” Cresson responded (with a copy to Poppin): “Sorry. No can 

do. [I] don’t have the dollars to make that kind of guarantee.” Poppin did not reply to 

this second email, investigate the status of CDC, or take other action with respect to the 

Guaranty. Cresson testified, “I certainly don’t believe that I did deal with him unjustly. 

When I had bad news to convey, I did not sugarcoat it. I was very straight.” He argued 

Poppin could have sought to withdraw as Infill’s counsel at that point, thereby limiting 

his fee exposure. Poppin testified that he first learned that CDC had been suspended only 

after he had withdrawn as counsel for Infill in 2008, and that if he had learned about the 

suspension earlier he would have tried to extricate himself from the case. Regarding 

Cresson’s 2005 email, Poppin testified, “[Cresson] wrote to me in an email, ‘We’re 

broke.’ Do you know how many debtors have written, ‘We’re broke and can’t pay,’ and 

they’re lying?” 
7

D. Closing Argument

 On the alter ego issue, Poppin argued, “There’s no evidence to suggest that . . . 

Cresson ever conducted . . . his corporation in any way which would allow there to be a 

separation between individual and the corporation. We’ve asked him to produce . . . 

separate bank accounts, some minutes, all the things that the law requires you to do to 

separate yourself from a corporate entity and there were none of those,” even though 

Cresson was in a position to produce the records. “I don’t know what else we can do in 

terms of proof except to send interrogatories and ask to please produce the documents 

which show . . . validity of the corporation. [¶] . . . [¶] [W]e have to assume, since they 

couldn’t produce them, they didn’t know where they were or . . . that none exist.” 

 Cresson responded that Poppin bore the burden of proof on the alter ego issue and 

“there’s a factual vacuum[.] . . . [A]s long as I have discharged honestly and diligently 

my discovery obligations, I am not responsible for that factual vacuum.” Had discovery 

been propounded directly on CDC, Cresson argued, “Kulda would have come in here 

with all these documents, all the banking records and my brother would have found . . . 

the old corporate records to the extent he had them. I don’t have them. If I had them, I 

would have brought them.” “I use my brother’s office . . . as a mailing address. . . . 

[¶] . . . I’m working mainly out of a pizza-and-Kinko’s.” He argued, “I have offered 

testimony [of CDC’s separate corporate existence] and that testimony is not contradicted 

by any evidence. And of the 20 factors [in Associated Vendors, Inc. v. Oakland Meat Co.

(1962) 210 Cal.App.2d 825] . . . [¶] I think the one fact that has been offered . . . is . . . I 

executed a document on behalf of a defunct entity. But I don’t believe that there’s any 

evidence to support any of the other factors.” 

 “Even putting that aside,” Poppin argued, “it is quite sufficient [to establish alter 

ego liability] . . . to show that the corporation was defunct and not allowed to do business 

long before they entered into the contract.” He expressly argued that the case turned on 

the fact that CDC was unable to do business in 2003 when Cresson signed the Guaranty. 

He argued Cresson was “lying” in 2003. “Cresson knew very, very well that his 

company was defunct. He knew it because he controlled it. He was the president of it.” 
8

Cresson maintained, “I don’t believe that someone is entitled to just accept that I am the 

one and only authority for [CDC]. I never suggested that, and Robert Kulda was actually 

involved in [the Infill] project.” He argued further, “[CDC] was a bit player in this 

guarantee. No bills went to [CDC]. When there were dunning calls, they didn’t go to 

[CDC]. When [Poppin] learned of the disability of [CDC], contrary to his stated view 

that he would immediately withdraw, he didn’t do that. It was years later that he 

withdr[e]w. His motion to withdraw had nothing to do with [CDC’s] disability. [¶] . . . 

[H]e saw an error, a very embarrassing error on my part, in the formulation of that 

document and pounced on it for collection purposes. That’s what people do when they 

are owed money. But I don’t believe that . . . it was ever really relied upon to begin with. 

And I don’t believe that it was handled in the proper way once the disability of [CDC] 

was learned.” 

 Cresson further argued that once there had been a late payment or at least once he 

told Poppin in 2005 that CDC was defunct, Poppin should have addressed the issue and 

demanded a replacement guaranty or withdrawn as counsel. 

E. Oral Statement of Decision 

 The trial court rendered an oral statement of decision on the alter ego issue. 

“Poppin testified with no contradiction that he asked for a personal guaranty . . . for 

[Cresson] to sign personally. But you made it clear you were not going to sign and put 

yourself personally on the hook. . . . [¶] . . . [But] you said, ‘My company’s good for it.’ 

. . . [W]as it reasonable for him to rely on a referred contract with a corporate president to 

sign on the bottom line? Yes. [¶] It’s not a fraud case . . . where . . . the jury evaluates 

whether it was reasonable reliance and so forth. This was the negotiated deal, and . . . 

this is not an impermissible risk. It was a risk of saying, I’d like your personal guaranty. 

Answer: I’m not going to give it. Well, then how about your corporation? It’s good for 

it. [¶] . . . Cresson said, I really had in mind that my company had at least $37,500. We 

could have been good for that. But somehow then, some years later when we got behind 

in and made it clear that my company was defunct, . . . [¶] . . . that somehow from that 

moment forward, . . . Poppin probably should have—well, and that’s where the argument 
9

breaks down, because it’s not a legal argument; it’s something about justice and fair play. 

[¶] . . . [¶] . . . Cresson, . . . as the president of the company, having elected to do business 

in the form of a corporation that offers substantial protections exactly of the kind you’re 

describing, that it’s a matter of the corporation maintaining the distinction between an 

individual and the corporate entity and causing meetings to occur and causing minutes to 

be prepared and to maintain a minute book, and to have share certificates and to make 

regular filings and pay the money to the state for the privilege of doing business. [¶] And 

I think the history in Oregon with two sets of suspensions and revivors and notices to you 

as president and the history in California of that, it makes it difficult. It tells me that, 

without saying anything bad, something is happening in your life but you are charged 

with the responsibility for keeping alert to those developments if you want the protection 

of the form of a corporation of doing business. [¶] And as it relates to the discovery 

process, well, it’s my brother, this address, or it’s just an office drop or things going on, I 

think you, as president of the corporation, were in a far superior position to quickly, 

efficiently scoop up a paper bag with whatever papers there were and answer questions 

under oath at a deposition. And it’s not an obligation of . . . Poppin . . . to go through the 

shell of the corporation to you under these circumstances that he has to do all that. 

 “[T]he document from the State of California showed you were not authorized to 

sign the document. You call it an embarrassing mistake. It was contrary to the privilege 

of doing business as a corporation when you signed as guarantor and when, in addition, 

you told . . . Poppin undisputedly that ‘I’m good for it,’ and you had in mind at least 

[$]37,000 in the bank. For two years or three you hadn’t been authorized to do business 

anyway. [¶] So I do find that there’s ample reason in justice and in equity to disregard the 

corporate entity in this case.” 

F. Judgment

 The court entered judgment against Cresson (and Radin) for $70,634.30 in fees 

and $35,317.15 in interest, for a total of $105,951.45. 
10

II. DISCUSSION

 Cresson argues the trial court’s finding that he was liable as CDC’s alter ego was 

unsupported by substantial evidence. We conclude the trial court’s statement of decision 

cites substantial evidence supporting a finding of unity of interest between Cresson and 

CDC and a conclusion that recognizing the separate identity of CDC would lead to an 

inequitable result.6

A. Standard of Review 

 “Ordinarily, a corporation is regarded as a legal entity, separate and distinct from 

its stockholders, officers and directors, with separate and distinct liabilities and 

obligations.” (Sonora Diamond Corp. v. Superior Court (2000) 83 Cal.App.4th 523, 

538.) “Whether a party is liable under an alter ego theory is normally a question of fact. 

[Citations.] ‘The conditions under which the corporate entity may be disregarded, or the 

corporation be regarded as the alter ego of the stockholders, necessarily vary according to 

the circumstances in each case inasmuch as the doctrine is essentially an equitable one 

and for that reason is particularly within the province of the trial court.’ [Citation.] 

Nevertheless, it is generally stated that in order to prevail on an alter ego theory, the 

plaintiff must show that ‘(1) there is such a unity of interest that the separate personalities 

of the corporations no longer exist; and (2) inequitable results will follow if the corporate 

separateness is respected.’ ” (Zoran Corp. v. Chen (2010) 185 Cal.App.4th 799, 811 

(Zoran).) 

 “ ‘The alter ego test encompasses a host of factors: “. . . [c]ommingling of funds 

and other assets, failure to segregate funds of the separate entities, and the unauthorized 

diversion of corporate funds or assets to other than corporate uses[;] . . . the treatment by 

an individual of the assets of the corporation as his own[;] . . . the failure to maintain 

minutes or adequate corporate records, and the confusion of the records of the separate 

entities[;] . . . the failure to adequately capitalize a corporation; the total absence of 

corporate assets, and undercapitalization[;] . . . the use of a corporation as a mere shell, 

 6

 Because we affirm the judgment based on a finding of alter ego liability, we need 

not address Poppin’s argument regarding the second cause of action (common counts). 
11

instrumentality or conduit for a single venture or the business of an individual or another 

corporation . . . . This long list of factors is not exhaustive. The enumerated factors may 

be considered “[a]mong” others “under the particular circumstances of each case.” ’ 

[Citations.] ‘No single factor is determinative, and instead a court must examine all the 

circumstances to determine whether to apply the doctrine.’ ” (Zoran, supra,

185 Cal.App.4th at pp. 811–812; see Associated Vendors, Inc. v. Oakland Meat Co., 

supra, 210 Cal.App.2d at pp. 838–840.) 

 We review the trial court’s alter ego ruling for substantial evidence, with “all 

conflicts in the evidence . . . resolved in favor of the respondent, and . . . all legitimate 

and reasonable inferences . . . indulged in to uphold the findings of the trial court.” 

(Associated Vendors, Inc. v. Oakland Meat Co., supra, 210 Cal.App.2d at p. 835.) 

“ ‘Whether the evidence has established that the corporate veil should be ignored is 

primarily a question of fact which should not be disturbed when supported by substantial 

evidence.’ ” (Toho-Towa Co., Ltd. v. Morgan Creek Productions, Inc. (2013) 

217 Cal.App.4th 1096, 1108.) 

B. CDC’s Direct Liability

 As a preliminary legal matter, Cresson argues on appeal that a prerequisite to 

imposing alter ego liability on an individual is a finding that corporation itself was liable 

under the contract. He argues his signature on the Guaranty as CDC’s president was 

insufficient alone to bind CDC, and therefore the prerequisite was not satisfied in this 

case. 

 This argument is forfeited because Cresson did not raise it in the trial court until 

after entry of judgment. Cresson claims he argued during the trial “that CDC only 

partially executed the [Guaranty] . . . and that CDC was not bound by it.” In the passage 

of the reporter’s transcript that Cresson cites in support of this claim, however, he 

testified, “I should never have even partially had [CDC] partially execute a document 

when its corporate status was as it was at that time. I don’t dispute that.” Cresson 

acknowledged his negligence in signing the Guaranty on behalf of CDC when CDC’s 

corporate status had been suspended and argued, “I don’t believe, other than that fact—
12

and it’s a terrible one, I admit it— . . . there’s any other fact that would stand for the 

proposition that [CDC] was . . . a mere shell or instrumentality.” (Italics added.) Cresson 

was acknowledging that his execution of the Guaranty while CDC was suspended tended 

to support imposition of alter ego liability. He never argued that his sole signature on the 

Guaranty was insufficient to bind CDC and thus there was no corporate liability for 

which he could be held personally responsible. Cresson seems to fail to appreciate the 

irony in his argument that the Guaranty is invalid due to failure of the corporation to 

observe corporate formalities to ratify and approve his signature. The argument is in any 

event forfeited. (See Ward v. Taggart (1959) 51 Cal.2d 736, 742.) 

C. Discovery Documents

 As a preliminary procedural matter, Cresson contests Poppin’s reliance on 

Cresson’s deposition testimony and responses to discovery demands (Exhibits 8 & 10).7

 

Cresson raises numerous challenges to the trial court’s and this court’s consideration of 

these exhibits, none of which we find persuasive. 

 Cresson argues “the trial court was not entitled to rely upon and this court must 

disregard these trial exhibits because each of them was lodged with the trial court with 

the express representation by Poppin’s attorney that they were being lodged with the trial 

court, ‘not for purposes of this trial.’ ” This is a mischaracterization of the record. In 

relation to the disputed exhibits, Poppin’s attorney first commented, “We offer Exhibits—

not for the purposes of this trial, but just to make sure the record is clear—Exhibits 7 

and 8. I think 7 I don’t have in front of me. 7 are the documents that we asked you to 

take judicial notice of. [¶] . . . [¶] . . . And I just wanted to make sure the record was clear 

on that and that they were lodged with the court in their original form.” The court 

acknowledged that it would “take judicial notice of those.” Exhibit 7, which is included 

in the appellant’s appendix, consists of the notices from Oregon and California 

concerning CDC’s suspended status and related state records. Poppin had previously 

 7

 Cresson complains that he could not locate Exhibits 8 or 10 in respondent’s 

appendix. Both exhibits, however, are clearly indentified in the appendix and listed in 

the index. 
13

filed a request for judicial notice of those records in support of his motions in limine on 

the alter ego issue, and the court apparently had deferred ruling on that request. Poppin’s 

attorney thereafter offered Exhibits 8 and 10 to “be admitted into evidence,” and the court 

said, “They’re admitted.” Taken in context, the record does not support Cresson’s 

contention that Exhibits 8 and 10 were simply subjects of judicial notice and were not 

received in evidence for purposes of trial. 

 Cresson next contends Poppin lodged Exhibits 8 and 10 with the trial court 

“without first showing any of them to defendants,” and “at no point during the balance of 

the trial did Poppin show Cresson any part of these trial exhibits” or give him an 

opportunity to explain or respond to them. Poppin’s attorney, however, expressly 

described the exhibits to the court as “some discovery that was involved [sic] to 

Mr. Cresson” and as “discovery documents” and expressly asked that they “be admitted 

into evidence.” Cresson did not object. Poppin previously described and extensively 

quoted from the documents in his motions in limine—citing them for the same purpose 

pretrial as at trial and on appeal. Cresson never protested in the trial court that he had not 

been given an opportunity to explain his discovery responses. On the contrary, he 

defended his discovery responses as reasonable and argued that Poppin had failed to meet 

his burden of producing evidence by failing to propound discovery directly on CDC. We 

see no procedural unfairness or error. 

 Cresson next argues the exhibits were improperly admitted because they were 

incomplete and not properly authenticated or verified; the deposition passages were not 

read into the record; and the court never ruled on objections that Cresson made in his 

written discovery responses and during the deposition. Because Cresson did not 

challenge admission of the evidence on these grounds in the trial court, the arguments are 

forfeited. (See Ward v. Taggart, supra, 51 Cal.2d at p. 742.) Even though Cresson 

represented himself in the trial court, he is held to the same rules as a represented party. 

(See McComber v. Wells (1999) 72 Cal.App.4th 512, 522–523.) 

 In any event, we take into account Cresson’s explanations of his discovery 

responses post when we consider whether the trial court’s alter ego finding was supported 
14

by substantial evidence. We reject his arguments that the exhibits failed to support the 

court’s ruling. 

D. Significance of CDC’s Dissolved and Forfeited Status in 2003 

 Cresson argues the trial court applied the wrong legal standard in imposing alter 

ego liability. He contends the court pierced the corporate veil solely because CDC was a 

suspended corporation in 2003 when Cresson signed the Guaranty on the corporation’s 

behalf and not by applying the two-prong alter ego test described in Zoran, supra,

185 Cal.App.4th at page 811.8

 Cresson cites a Ninth Circuit opinion expressing its view 

that California law does not impose personal liability based solely on a corporation’s 

suspended corporate status. (United States v. Standard Beauty Supply Stores, Inc. (1977) 

561 F.2d 774, 776–777.) That same opinion, however, acknowledged that a 

corporation’s inactive status remains a relevant factor in the alter ego analysis: “[A] 

corporation’s failure to pay its franchise tax may be evidence that the shareholders do not 

view the corporation as having a separate existence . . . [and] this failure must be treated 

and weighed like any other failure to observe the normal requirements for a corporation.” 

(Id. at p. 777, italics added.) 

 Cresson cites certain comments by the trial court in colloquy during his testimony 

as evidence the court expressly disclaimed any reliance on evidence that CDC failed to 

observe corporate formalities or on similar alter ego factors. Even if the comments could 

be interpreted as Cresson suggest, he takes the remarks out of context, and we conclude 

that the court made clear in its oral statement of decision that it did not rely solely on 

CDC’s delinquent status to make its alter ego finding.

E. Unity of Interest Between CDC and Cresson

 As noted ante, the first prong of the alter ego test is whether “ ‘there is such a 

unity of interest that the separate personalit[y] of the corporation[] no longer exist[s].’ ” 

(Zoran, supra, 185 Cal.App.4th at p. 811.) Cresson complains that the trial court drew a 

 8

 We acknowledge that Poppin argued in the trial court that alter ego liability 

could be imposed simply because of the corporation’s inactive status at the time Cresson 

signed the Guaranty. 
15

negative inference from his failure to produce corporate records that would demonstrate 

that CDC observed corporate formalities, issued stock, held director and shareholder 

meetings, and was adequately capitalized. In other words, the court erred by implicitly 

finding that CDC failed to do those things. We find that the court was entitled to draw 

such inferences, and that those inferences are more than adequate to support the alter ego 

finding. 

 Essentially, Cresson argues that the court, in drawing negative inferences from his 

failure to produce CDC’s corporate records in discovery, shifted the burden of proof on 

the alter ego issue and required him to prove CDC’s separate corporate existence. (See 

Mid-Century Ins. Co. v. Gardner (1992) 9 Cal.App.4th 1205, 1212 [“[i]t is the plaintiff’s 

burden to overcome the presumption of the separate existence of the corporate entity”].) 

He notes that he testified in deposition that he did not have possession of CDC’s 

corporate records, not that those records did not exist; and he testified that he did not 

recall whether CDC ever issued stock or paid taxes (and thus presumably had stock or 

tax records), not that CDC never had such records. However, the trial court ruled that 

Cresson, “as president of the corporation, w[as] in a far superior position to quickly, 

efficiently scoop up a paper bag with whatever papers there were and answer questions 

under oath at a deposition. And it’s not an obligation of . . . Poppin . . . to go through the 

shell of the corporation to you under these circumstances that he has to do all that.” The 

court was not required to accept Cresson’s self-serving explanations. Documents 

produced from Oregon and California public records showed that Cresson was at least 

aware of his obligation to make public filings on behalf of the corporation, and to pay 

fees and taxes to keep its corporate powers intact.9

 Cresson identified himself in those 

filings as the corporation’s president or chief executive officer. The court could 

reasonably view Cresson’s disclaimer of knowledge as to the conduct of corporate affairs 

and location of relevant records as suspect at best. “If weaker and less satisfactory 

 9

 These documents also render suspect Cresson’s denial of knowledge of the 

corporate suspensions at the time he executed the Guaranty in 2003. 
16

evidence is offered when it was within the power of the party to produce stronger and 

more satisfactory evidence, the evidence offered should be viewed with distrust.” (Evid. 

Code, § 412; see CACI No. 203.) The trial court here was entitled to view Cresson’s 

testimony that CDC observed all corporate formalities with distrust in light of his failure 

to produce any corporate records to demonstrate that fact. (See Largey v. Intrastate 

Radiotelephone, Inc. (1982) 136 Cal.App.3d 660, 664, 672 [Evid. Code, § 412 held to 

apply where company officer testified from memory about the date of a company board 

meeting rather than producing corporate records to establish when the meeting occurred]) 

 Cresson notes that he was deposed as an individual, not as a representative of 

CDC, and that Poppin never claimed Cresson’s responses were inadequate or filed a 

motion to compel further discovery responses from him. He cites no authority, however, 

for the proposition that failure to seek court intervention or sanctions is necessary before 

the trial court could properly draw negative inferences from the discovery responses he 

chose to provide. 

 There was substantial evidence of CDC’s failure to maintain minutes or adequate 

corporate records, disregard of corporate formalities, and use of the corporation, since at 

least 2000, as a mere shell, instrumentality or conduit for Cresson’s business. (Zoran, 

supra, 185 Cal.App.4th at pp. 811–812.) We conclude the trial court’s finding of unity of 

interest and ownership was supported by substantial evidence. 

F. Inequitable Result

 “The second requirement for application of the alter ego doctrine is a finding that 

the facts are such that adherence to the fiction of the separate existence of the corporation 

would sanction a fraud or promote injustice. [Citation.] The test for this requirement is 

that if the acts are treated as those of the corporation alone, it will produce an unjust or 

inequitable result.” (Misik v. D’Arco (2011) 197 Cal.App.4th 1065, 1073; Zoran, supra,

185 Cal.App.4th at p. 811 [“ ‘inequitable results will follow if the corporate separateness 

is respected’ ”].) “Certainly, it is not sufficient to merely show that a creditor will remain 

unsatisfied if the corporate veil is not pierced . . . . The purpose of the doctrine is not to 

protect every unsatisfied creditor, but rather to afford him protection, where some 
17

conduct amounting to bad faith makes it inequitable . . . .” (Associated Vendors, Inc. v. 

Oakland Meat Co., supra, 210 Cal.App.2d at p. 842.) Nevertheless, neither actual fraud 

nor wrongful intent need be shown to establish this inequitable results prong of the alter 

ego test. (Claremont Press Pub. Co. v. Barksdale (1960) 187 Cal.App.2d 813, 817; 

Relentless Air Racing, LLC v. Airborne Turbine Ltd. Partnership (2013) 222 Cal.App.4th 

811, 816.) Rather, the second prong is satisfied when the alleged alter ego seeks the 

benefits of the corporate form (limited liability) but shirks the corresponding burdens of 

the corporate form in a manner that unfairly prejudices the interests of third parties. 

(Mesler v. Bragg Management Co. (1985) 39 Cal.3d 290, 300; Aladdin Oil Corp. v. 

Perluss (1964) 230 Cal.App.2d 603, 614.) 

 In its oral statement of decision, the trial court ruled “there’s ample reason in 

justice and in equity to disregard the corporate entity in this case” because Cresson signed 

the Guaranty on behalf of CDC and expressly assured Poppin that CDC was “good for it” 

at a time when Cresson should have known the corporation was defunct.10 Cresson 

argues his actions were not inequitable because CDC could have paid Infill’s legal bills at 

the time the Guaranty was signed. Although Cresson testified CDC could have paid 

Infill’s anticipated bills, the court was free to draw a contrary inference from CDC’s then 

dissolved and forfeited status (resulting from CDC’s failure to pay its tax obligations in 

both Oregon and California), from Cresson’s inability to produce corporate records that 

would corroborate CDC’s financial status in 2003, and from the fact that many of Infill’s 

bills ultimately were unpaid. 

 Cresson further appears to fault Poppin for failure to withdraw from representation 

of Infill after advising Poppin in June 2005 that CDC was defunct. Cresson fails to 

 10 Cresson faults the court for misquoting Poppin’s testimony on this point. 

Poppin testified that, when Cresson refused to sign the Guaranty in his individual 

capacity, he told Poppin, “ ‘But don’t worry about it. [CDC] is good for it.’ ” The court 

quoted Cresson’s statement as “ ‘My company’s good for it.’ ” The court, however, did 

not rely on Cresson’s alleged representation that CDC was his company to find an 

inequitable result; rather, it relied on Cresson’s representation that CDC was good for it. 

The misquotation, therefore, is immaterial. 
18

explain how his notice to Poppin would void the obligations of the previously executed 

Guaranty, or how Poppin could ethically seek to withdraw from representing his client at 

a time when his bills were still being paid. To the extent Cresson contends that Poppin’s 

equitable position was compromised by not abandoning his client, we disagree. 

 Cresson notes that the trial court stated, “It’s not a fraud case.” However, as noted 

ante, actual fraud need not be proven to establish an inequitable result. The court’s point 

was that Poppin was not required to prove that he justifiably relied on Cresson’s 

statement in order to obtain the relief he sought in the case. The court found that 

Poppin’s reliance on the representation of CDC’s president (Cresson) that CDC was 

“good for” the Guaranty was reasonable in the alter ego context in the sense that, under 

the circumstances, it would be inequitable to not pierce the corporate veil and thereby 

deny Poppin recovery. The trial court’s inequitable result finding is supported by 

substantial evidence. 

G. Conclusion 

 In sum, we find no error in the imposition of alter ego liability on Cresson. “ ‘As 

the separate personality of the corporation is a statutory privilege, it must be used for 

legitimate business purposes and must not be perverted. When it is abused it will be 

disregarded and the corporation looked at as a collection or association of individuals, so 

that the corporation will be liable for acts of the stockholders or the stockholders liable 

for acts done in the name of the corporation.’ ” (Mesler v. Bragg Management Co., 

supra, 39 Cal.3d at p. 300.) “ ‘Parties who determine to avail themselves of the right to 

do business by means of the establishment of a corporate entity must assume the burdens 

thereof as well as the privileges.’ ” (Shapoff v. Scull (1990) 222 Cal.App.3d 1457, 1470, 

disapproved on another ground by Applied Equipment Corp. v. Litton Saudi Arabia Ltd.

(1994) 7 Cal.4th 503, 521, fn. 10.) 

III. DISPOSITION

 The judgment is affirmed. Poppin shall recover his costs on appeal. 
19

 _________________________ 

 BRUINIERS, J. 

WE CONCUR: 

_________________________ 

JONES, P. J. 

_________________________ 

SIMONS, J.