Court Opinion

ID: 5132562
Source: CourtListenerOpinion
Date Created: 2021-12-07 20:03:07.058104+00
Date Added: 2024-06-11T08:23:30.856887
License: Public Domain

Filed 12/7/21 Kyundibekyan v. Reese CA2/8
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                         SECOND APPELLATE DISTRICT

                                      DIVISION EIGHT

KARAPET KYUNDIBEKYAN et                                          B302665
al.,
                                                                 (Los Angeles County
         Plaintiffs and Appellants,                              Super. Ct. No. BC633974)

         v.

ROSHANN REESE et al.,

     Defendants and
Respondents.

     APPEAL from a judgment of the Superior Court of Los
Angeles County, Steven Kleifield, Judge. Affirmed.

     Anderson & Associates, Michael D. Anderson and Andrei V.
Serpik for Plaintiffs and Appellants.

      Law Office of Stewart J. Neuville and Stewart J. Neuville
for Defendants and Respondents.

                             ______________________
       This case arises from a failed sale of the assets of Advanced
Business Conglomerate, Inc. (ABC) to brothers Karapet and
Vardan Kyundibekyan (appellants). ABC is a small corporation
which provided home health care services under the name
Benevolent Home Care. After signing a purchase agreement,
making a down payment, and attempting to run the business for
the month of August 2016, appellants gave notice of rescission
and demanded their down payment be returned. Roshann Reese,
the sole shareholder of ABC, declined to return the down
payment. Appellants sued ABC, Reese, and her son Shawn
Phillips (respondents) for negligent and fraudulent
misrepresentation and breach of oral and written contract. ABC
and Reese filed a cross-complaint alleging breach of contract,
negligence, fraud and deceit, and slander.
       Both actions were tried by the court, which explained in its
statement of decision that the sale/purchase agreement was void
for indefiniteness. Relying on equitable principles of restitution,
the court found appellants were not entitled to the return of the
down payment. The court found appellants were entitled to “the
$12,705.12 that was billed for the month of August” to
Medicare/Medical on appellants’ behalf. The court stated:
“Defendants are unjustly enriched by retaining those funds,
which should be paid to Plaintiffs” and found “against the
Defendants for failure to turn over monies received for billing for
services rendered by Plaintiffs in the sum of $12,705.12.” In the
final judgment, however, the court only found against ABC for
the $12,705.12.
       Appellants appeal, contending the trial court abused its
discretion in failing to order the return of the down payment and
failing to find Reese and Phillips personally liable for the

                                 2
payment of the billed funds. Respondents contend the record is
inadequate to permit meaningful appellate review, and the
appeal should be denied on that ground alone. We find the record
adequate to address appellants’ claim about the return of the
down payment, but find no abuse of discretion or error in the trial
court’s decision to deny return. We find no error on the face of
the record concerning the trial court’s decision to hold only ABC
liable for the $12,705.12 in billed services for August.
Accordingly, we affirm the judgment.

                           BACKGROUND
       Following a five-day court trial, the court issued its written
statement of decision in this matter. The trial court’s statement
contains a summary of the evidence offered at trial; it is the only
record of much of that evidence. Although the court trial of this
matter involved 10 witnesses, appellants provided a reporter’s
transcript of the testimony of Reese and Phillips only, a clerk’s
transcript, and a joint appendix of recreated trial exhibits. We
rely on the trial court’s statement for much of the background
details of this appeal.
       As the trial court in this case aptly summarized in its
written statement of decision: “This case boils down to an
attempted sale of a marginally profitable business by a seller who
was eager to sell, to an unsophisticated buyer who did not
exercise due diligence; and a failure to agree on a material term
of the agreement, i.e. the extent of the cooperation and assistance
by the seller that would be contractually required to transition
ownership.”

                                  3
       This case has its origins in early 2016, when appellants
learned that Reese wanted to sell ABC. She planned to attend
medical school. Reese’s son Phillips ran the finances for the
company.
       In June 2016, appellants made a $5,000 down payment and
were shown some financial documents for ABC. Thereafter, on
July 29, 2016, the parties signed a written agreement pursuant
to which appellants would purchase ABC by making a series of
payments totaling $330,000. As structured in the agreement,
appellants would make a down payment of $50,000 upon signing
the agreement, and would pay $8,000 a month beginning in
September 2016. In February 2017, assuming certain conditions
were met, appellants would make a second $50,000 payment and
the sale would “close.” Appellants would receive financial
control of ABC. Although the parties initially discussed a sale of
ABC’s shares to appellants, ultimately the transaction was the
sale of ABC’s “two provider numbers that allowed one to provide
home health care and bill Medicare and Medi-Cal for their
services.” Appellants were also purchasing the right to use the
name “Benevolent Home Care.”
       Appellants received operational control of ABC on August
1, 2016, and attempted to run the business for the month of
August. At the end of the month, they gave notice they were
rescinding the contract due to respondents’ “fraudulent
misrepresentation of the potential liabilities and financial status”
of ABC. ~(CT 205, 599)~
       Appellants subsequently contended they were not informed
of fraudulent billing practices, non-compliance with Medicare and
Medicaid rules and labor law, and pre-existing tax liabilities.
They also claimed respondents had not cooperated in assisting

                                 4
appellants’ transition into ownership. Respondents cross-
complained for breach of contract.
       The trial court held a five-day court trial involving 10
witnesses. The court found that “the contract was extremely
poorly written, especially with respect to the seller’s obligations.
While the buyers’ obligations are fairly well spelled out, the
seller’s obligations are not. This omission was the primary
reason [appellants] gave notice of rescission after only one month
of attempting to run the business.”
       The court found: “As illustrated by the facts in this case, a
transition period is necessary to acclimate the buyers to the
business, so they can run it profitably. The parties would need to
work together cooperatively to obtain the transfer of the provider
numbers.” The court also found that “the Seller’s obligations
were only vaguely, and inadequately defined.” Appellants also
“entered into oral agreements only with Reese and Phillips for
assistance; the duties were never entirely clear.” Phillips,
however, had moved to Arkansas in June for another opportunity
and was “largely unavailable.” Reese was “largely unavailable as
well; she was in the process of leaving the country for medical
school.”
       When appellants had contact with ABC’s employees, they
encountered a litany of complaints: bounced checks, unpaid
overtime, a shortage of nurses, and a lack of training. “These
were all things for which [appellants] needed assistance;
however, the assistance was rarely there. The transition was a
disaster.”
       The court concluded the contract was “not ‘sufficiently
definite” to be enforceable. Cooperation and assistance by the
seller was an indispensable material term that was not

                                 5
adequately addressed in the written contract. “It is not possible
to ‘fill in the gaps’ in this contract to determine whether either
side committed a breach.”
        The court did not place the blame for this solely on either
party. The court found appellants fell short in their “due
diligence” in purchasing a business: “The evidence showed that
consultants are available for hire to assist in valuing home health
care businesses, and assisting in making decisions regarding
whether and on what terms to purchase a home health care
business. Indeed, Plaintiffs hired such a consultant . . . after they
became concerned about what they had just purchased, as
opposed to before they made the purchase. . . . Plaintiffs were
surprised about many aspects of the business which they would
have known had they hired a consultant.”
        The court expressly rejected appellants’ claim that
respondents committed fraud. The court specifically addressed
appellants’ claim that they were defrauded by not being made
aware of approximately $170,000 in tax liabilities. The court
found their claim “rings hollow.” The court also found “not
convincing” appellants’ claim that they were confused by
references to payments to the IRS for a trust fund penalty.
        After reiterating that the contract was not “sufficiently
definite” to be enforceable and so “neither side has any
obligations to the other under the contract,” the court turned to
the question of the $50,000 down payment. The court stated:
“The Court is of the view that at the time the parties entered into
the contract, all parties believed that they would ultimately
succeed. It was only after the first month that it became clear
that they would not. Due to their lack of due diligence, Plaintiffs
decided to take over the operations of the business without

                                 6
knowing exactly what they were getting into, and assumed the
risk of failure.”
       Responding to a request by appellants after the tentative
ruling, the court addressed $12,705.12 billed for the month of
August on appellants’ behalf, and determined that appellants
were entitled to the monies. “Defendants are unjustly enriched
by retaining those funds, which should be paid to Plaintiffs.”
       The court found no breach of contract by any party, and
awarded no damages for breach of contract.
       Respondents objected to the statement of decision,
contending that they had used the $12,705.12 to pay expenses
incurred by ABC during the time appellants had operational
control, and so were not unjustly enriched. Appellants replied
that respondents were relying on evidence which was not
presented at trial and so should not be considered by the court.
The court agreed. Reese and Phillips then objected that they
should not be liable for payment of the $12,705.12 to appellants,
as they did not receive or retain any of the funds and so were not
enriched. The trial court apparently agreed with this claim, as
the final judgment is against ABC only.

                         DISCUSSION

A.    The Record Is Adequate to Permit Review of Appellants’
      Down Payment Claim But Not Their Claim Concerning
      Billing Payments
      Respondents contend the appeal should fail because
appellant has not provided an adequate record. There was no
court reporter for, and hence no reporter’s transcript of, the
testimony of appellants or six other witnesses. The reporter’s
transcripts cover the testimony of Reese and Phillips only.

                                 7
       “The party challenging a lower court judgment has the
affirmative obligation to provide an adequate record. In the
absence of such a record, the judgment must be affirmed.”
(Hersey v. Vopava (2019) 38 Cal.App.5th 792, 798.) “We cannot
presume the trial court has erred. . . . ‘ “A judgment or order of
the lower court is presumed correct. All intendments and
presumptions are indulged to support it on matters as to which
the record is silent. . . .” [Citation.]’ ” (Vo v. Las Virgenes
Municipal Water Dist. (2000) 79 Cal.App.4th 440, 447.)
       Appellants acknowledge the record does not contain
reporter’s transcripts of most of the trial testimony, including
their own testimony. They contend this appeal “presents
questions which all rest on the undisputed facts found by the
Trial Court. Appellants do not assert that the Trial Court should
have found different facts.” They further claim that the “findings
of facts . . . are not being challenged.” Thus, they claim a
complete record of the trial proceedings are not necessary. (See
Chodos v. Cole (2012) 210 Cal.App.4th 692.)
       We agree the record is adequate to permit a review of the
trial court’s decision to deny appellants’ request for the return of
the first down payment, that is, to review the trial court’s
application of the law to the undisputed facts. We note, however,
that appellants’ claim that they are not “challenging” the findings
of facts is somewhat disingenuous. They frequently avoid
“challenging” the court’s findings by mischaracterizing or
ignoring them. While we do not correct every instance of
mischaracterization or avoidance, we note that appellants’
repeated descriptions of respondents’ “bad faith” are completely
inconsistent with the trial court’s statement of decision, as are
their descriptions of themselves as victims. Appellants made

                                 8
numerous claims of wrongdoing by respondents, and all were
rejected by the trial court. The court found respondents “had an
incentive to see that [appellants] were successful” and “had little
interest in deceiving.” The court found appellants “were not
entirely blameless” in the failure of the transaction because they
did not adequately investigate what assistance they would need
to transition to successful ownership. The court also found
appellants untruthful, a finding it did not make about
respondents.
       The trial court did not make any findings of fact concerning
its decision to hold only ABC responsible for turning over the
$12,705.12 in billing payments. Appellants contend Reese and
Phillips will be unjustly enriched if they are not held responsible
for turning over the money, which presents a factual question.
       Appellants contend that error appears on the face of the
record, and so we must presume the record includes all matters
necessary to decide the appeal. We find an alternate phrasing
more useful: Unless an error appears on the face of the record,
an appellant’s “ ‘[f]ailure to provide an adequate record on an
issue requires that the issue be resolved against [appellant].’ ”
(Foust v. San Jose Construction Co., Inc. (2011) 198 Cal.App.4th
181, 187.) We apply this standard to the court’s decision to hold
only ABC liable for the turnover of the $12,705.12 billing
proceeds.

B.    It Is Not Unjust to Permit Respondents to Retain the First
      Down Payment
      The trial court found appellants were not entitled to a
return of their down payment because “[d]ue to their lack of due
diligence, [they] decided to take over the operations of the

                                 9
business without knowing exactly what they were getting into,
and assumed the risk of failure.”
       Appellants contend the trial court abused its discretion in
denying the return of the down payment because respondents
would be unjustly enriched by its retention. Appellants further
contend the trial court erred in finding they had assumed the risk
of failure.
       Appellants contend that when “consideration . . . has failed”
the law implies a promise on the part of the payee to return
money paid as a consideration. (Green v. Antoine (1955)
133 Cal.App.2d 269, 274.) This is a principle that applies when a
valid contract exists, but one or both parties do not perform
under the contract. It is generally applicable when a contract is
rescinded or a party seeks rescission.
       This is not a rescission case. The court’s finding that no
contract existed precludes rescission. “Only a valid and binding
contract may be rescinded. ‘Loosely the term “rescission” has
been employed in a wide and generic sense. But it is not properly
applicable to the undoing of anything except that which has been
the subject of mutual agreement. . . . Again, before there can be
any “rescission,” properly so called, there must be a contract
completely formed and in force, or at least provisionally binding
on the parties.’ [Citation.] If the facts establish the nonexistence
of the alleged contract sought to be rescinded, in that there was
no meeting of minds, there can, of course, be no rescission.”
(Charles Brown & Sons v. White Lunch Co. (1928) 92 Cal.App.
457, 461–462.)
       General principles of restitution apply in the absence of a
valid contract. (See McBride v. Boughton (2004) 123 Cal.App.4th
379, 388.) “Under the law of restitution, ‘[a]n individual is

                                10
required to make restitution if he or she is unjustly enriched at
the expense of another. [Citations.] A person is enriched if the
person receives a benefit at another’s expense. [Citation.]’
[Citation.] However, ‘[t]he fact that one person benefits [from]
another is not, by itself, sufficient to require restitution. The
person receiving the benefit is required to make restitution only
if the circumstances are such that, as between the two
individuals, it is unjust for the person to retain it. [Citation.]’
[Citations.]” (Id. at p. 389.)
       We review a trial court’s decision to grant or deny an
equitable award based on unjust enrichment principles for an
abuse of discretion. “ ‘ “[O]ne of the essential attributes of abuse
of discretion is that it must clearly appear to effect injustice.” ’ ”
(Dorman v. DWLC Corp. (1995) 35 Cal.App.4th 1808, 1815.)
“ ‘ “The burden is on the party complaining to establish an abuse
of discretion.” ’ ” (Ibid.) “Abuse of discretion is a deferential
standard of review. [Citation.] Under this standard, a trial
court’s ruling ‘will be sustained on review unless it falls outside
the bounds of reason.’ [Citation.] We could therefore disagree
with the trial court’s conclusion, but if the trial court’s conclusion
was a reasonable exercise of its discretion, we are not free to
substitute our discretion for that of the trial court.” (Avant! Corp.
v. Superior Court (2000) 79 Cal.App.4th 876, 881–882.)
       Here, the evidence establishes that a home health care
business is a complex business with a myriad of regulatory
requirements, and that appellants were aware of this. As the
trial court noted: “It seems clear that Plaintiffs were purchasing
the two Provider numbers that allowed one to provide home
health care and bill Medicare and Medi-Cal for their services.”

                                 11
“An application process was necessary to obtain permission from
the agencies to transfer the provider numbers to Plaintiffs.”
       Although appellants were unsophisticated buyers, it is
undisputed they did not avail themselves of a consultant before
taking over the operations of a business about which they knew
little. As the court concluded: “Plaintiffs were surprised about
many aspects of the business which they would have known had
they hired a consultant.” Further, according to one such
consultant who assist buyers, “the extent of the assistance to be
required of the sellers is typically spelled out in a contract.”
While these specific comments by the court are related to the lack
of detail in the written agreement, they are equally applicable to
appellants’ failure to investigate what skills or knowledge they
needed to run the business before they took over control of it from
Reese in August.
       When Reese received about $50,000 from appellants, she
turned over the day-to-day operation of her business to
appellants in exchange for that payment. The trial court
described the period during which appellants had control of the
business as “a disaster” due to appellants’ inability to run the
business without assistance. Reese testified that when she
received operational control of the business back from appellants,
she decided to end the business because she had “no idea what
they did during the 30 days that they had possession of the
business.” In the absence of a valid sale contract, Reese retained

                                12
responsibility to Medicare and Medi-Cal for the business.1
Further, as the court noted in its statement of decision, Reese
wanted a quick sale of the business as she was planning to start
medical school in the Caribbean in the fall of 2016. The ship had
sailed on that goal.
       We see no abuse of discretion in the trial court’s decision
that, as between the two parties, it was not unjust to permit
Reese to keep the down payment. The court, as required,
“consider[ed] the material facts affecting the equities between the
parties.” (See Dickson, Carlson & Campillo v. Pole (2000)
83 Cal.App.4th 436, 447.) Although appellants were not
sophisticated in the home health care business, they elected not
to hire a consultant who could have helped them evaluate Reese’s
business and determine what would be involved in running it
themselves. Appellants quickly located a consultant after they
took control of operations, indicating that they had the ability to
find and hire such a consultant before the turn-over, but
apparently chose not to do so. The trial court found Reese was
largely unavailable to help appellants because “she was in the
process of leaving the country for medical school (which explains
why she was in a hurry to sell the company).” Reese’s position
was altered by appellant’s inability to run the business: she

1      To be clear, the trial court did not find that appellants
destroyed or materially damaged Reese’s business during the
month of August. At the same time, the trial court’s description
of the transition period as a “disaster” makes it clear that the
business was, at a minimum, disrupted during this period.
Similarly, Reese’s statement that she decided to close the
business shows that there were significant obstacles to her
resuming control of the business.

                                13
faced difficulties and uncertainties if she resumed operating the
business and she had lost valuable time if she decided to try to
find another buyer.
       In addition to considering the relative circumstances of the
parties, “[d]etermining whether it is unjust for a person to retain
a benefit may involve policy considerations. For example, if a
person receives a benefit because of another’s mistake, policy may
dictate that the person making the mistake assume the risk of
the error.” (First Nationwide Savings v. Perry (1992)
11 Cal.App.4th 1657, 1663.) For example, when a payment has
been made based upon a mistake of fact by the payor, the payor
generally is not entitled to restitution if “the payee has, in
reliance on the payment, materially changed its position.” (City
of Hope Nat. Medical Center v. Superior Court (1992)
8 Cal.App.4th 633, 636–637.) This is particularly the case if “ ‘it
is impossible or impractical to restore [the payee] to his original
position.’ ” (First Nationwide, at p. 1663.)
       Although we would not characterize appellants’ failure to
investigate the business as a mistake of fact, the mistake
example provides a useful analogy. Appellants made a down
payment to Reese in order to take over the operations of a
complicated business which they had not made sufficient efforts
to understand. In effect, they mistakenly believed they could run
the business. Reese altered her position in reliance on the down
payment by giving appellants operational control of her business
and ceasing her attempts to sell it. Appellants’ attempt to run
the business was a disaster, and Reese could not be restored to
her original position. Thus, it is sound policy to place the risk of
loss of the down payment on appellants, or, in other words, to
require them to assume the risk of loss.

                                14
      Appellants object to the trial court’s focus on their failure to
hire a consultant, contending that “relief related to rescission” is
not precluded on the grounds of negligence of the rescinding
party unless it rises to the level of neglect of a legal duty.
Appellants then speculate that it “appears” the court believed
appellants “breached a duty to insure that the Agreement was
properly drafted, which included a duty to hire an expert.” They
contend there is no evidence to support placing the risk of a
defective contract on them, particularly because the trial court
found that Reese drafted the contract.
      Again, discussions of legal principles related to rescission
are not helpful, as rescission is premised on the existence of a
valid and binding contract. Equally importantly, appellants’
argument ignores the plain language the court used in its
statement of decision. The trial court used the phrase “take over
operations of the business” and that phrase has a clear meaning.
It does not mean to draft a written agreement. The court found
that appellants took over operations of the business “without
knowing what they were getting into.” In this context of the
statement of decision, this phrase means without understanding
what was involved in operating the business. It does not mean
defectively drafting an agreement.

C.     There Is No Error on the Face of the Record as to the Trial
       Court’s Decision to Hold Only ABC Responsible for Turning
       Over the $12,705.12 in Billing Payments.
       Respondents objected to the trial court’s finding that they
were unjustly enriched by retaining the $12,705.12. After the
trial court ruled it would not consider evidence of payments made
on behalf of ABC which were not in evidence at trial, respondents
offered to show no funds were retained and filed an additional

                                 15
objection focusing on the personal liability of Reese and Phillips.
Following that filing, the court changed its decision to award
damages against ABC only. We see no error on the face of the
record in that ruling.
       As respondents pointed out in their objections, there is no
evidence in the record that Phillips or Reese personally received
or retained any funds from ABC after August 1, 2016, and so no
evidence that they were personally enriched. Thus, there was no
error in the trial court’s decision not to hold them responsible for
turning over the monies.
       Appellants implicitly acknowledge there is no such direct
evidence, but contend that we must infer that Phillips and Reese
took the money from ABC’s bank account because they “willfully”
refused to produce bank records. As appellants acknowledge,
Reese offered innocent explanations for the lack of
documentation, including losing printed copies and no longer
having access to the electronic bank records of ABC. Appellants
have not provided any record citation to show the trial court was
asked to or did find that respondents “willfully” refused to
produce documents or “suppressed” evidence. Accordingly, they
have forfeited this claim. (United Grand Corp. v. Malibu
Hillbillies, LLC (2019) 36 Cal.App.5th 142, 156 [when a party
fails to support an argument with the necessary citations to the
record, the argument is deemed waived.].)
       Appellants contend another reason supports holding Reese
responsible: the assumption of liability she made in connection
with the dissolution of ABC. We see no error on the face of the
record in the trial court’s implied finding that appellants had
failed to show that Reese’s assumption of liability applied to the
$12,705.12 award.

                                 16
       Corporations Code section 1905 requires that a certificate
of dissolution shall state that the corporation’s “known debts and
liabilities have been actually paid, or adequately provided for, or
paid or adequately provided for as far as its assets permitted, or
that it has incurred no known debts or liabilities, as the case may
be.” (Corp. Code, § 1905, subd. (a)(2), italics added.)2 “[A] claim
that has not yet arisen is not a known debt or obligation for
which the officers of a corporation undergoing dissolution must
provide.” (Peñasquitos, Inc. v. Superior Court (1991) 53 Cal.3d
1180, 1191, superseded by Corp. Code, § 2011 on another
ground.)
       The certificate of dissolution for ABC was an exhibit at
trial. The face of the documents shows Reese checked a pre-
printed box stating: “The corporation’s known debts and
liabilities have been adequately provided for by their assumption,
and the name and address of the assumer is ___.” Reese listed
herself as the assumer.

2     The remainder of the subdivision provides: “If there are
known debts or liabilities for payment of which adequate
provision has been made, the certificate shall state what
provision has been made, setting forth the name and address of
the corporation, person or governmental agency that has
assumed or guaranteed the payment, or the name and address of
the depositary with which deposit has been made or any other
information that may be necessary to enable the creditor or other
person to whom payment is to be made to appear and claim
payment of the debt or liability.” (Corp. Code, § 1905,
subd. (a)(2), italics added.)

                                17
      The record shows appellants served their notice of
rescission and demand letter on September 1, 2016. Reese signed
and mailed the certificate of dissolution on September 9, 2016.
Appellants filed their complaint in this action on September 15,
2016.
      The notice of rescission demanded the “return of
[appellants’] advance payment and expenses” in the amount of
$60,000. Appellants did not explain how they had arrived at this
amount, and on appeal they simply refer to the letter as
demanding a return of their down payment.3 The record shows
appellants were aware when they sent their rescission notice that
Phillips had billed Medicare for services on their behalf in
August, but that letter contains no demand that such monies be
turned over to appellants when received by ABC. Appellants did
make such claim two weeks later in their complaint, alleging that
they were entitled to the return of “the $55,570 they paid for the
Business and billing services, as well as the monies received for
home care services after August 01, 2016.” Thus, on the record
before us, the turnover of $12,705.12 in billed payments was not
a known liability when Reese completed the certificate of
dissolution.

3     The down payment itself totaled $50,000, and appellants
have identified an additional $4,070 in payments to Reese and
Phillips for rent, IRS liabilities, consulting services, and billing
services for a total of $54, 070. Although appellants use the
$54,070 amount on appeal they allege in their complaint that the
amount they paid to respondents was $55,570.

                                 18
      Appellants further contend Reese had “an obligation to
discover and provide for potential liabilities even if unknown or
contingent,” prior to filing the Certificate of Dissolution. The
issue whether Reese failed to satisfy her obligations when
dissolving ABC and whether such a failure rendered her
personally liable for any unknown liabilities of ABC is far beyond
the scope of the trial of this matter, and we do not consider it on
appeal.4

4      We recognize appellants contend the trial court removed
Reese from the judgment without giving them an opportunity to
respond to the removal, but appellants were clearly aware before
the trial court issued its tentative ruling that Reese would not
ordinarily be liable for ABC’s liabilities. They noted in their
closing trial brief that Reese had assumed “all of ABC, Inc’s
liabilities” in the certificate of dissolution. This was inaccurate,
and served to obscure the very issue which appellants now
belatedly wish to have decided: whether the billing payments
represented a “known” liability for ABC.

                                 19
                           DISPOSITION
         The judgement is affirmed. Respondents are awarded
costs.

         NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                                     STRATTON, Acting P. J.

We concur:

              WILEY. J.

              OHTA, J.*

*     Judge of the Los Angeles Superior Court, assigned by the
Chief Justice pursuant to article VI, section 6 of the California
Constitution.

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