Carolina Casualty Ins. Co. v. L.M. Ross Law Group, LLP

In Carolina Casualty Ins. Co. v. L.M. Ross Law Group, LLP (2012) 212 Cal.App.4th 1181, an insurer had obtained a judgment for certain amounts in a coverage action against a law firm (Ross Law Group). (Id. at pp. 1184-1186.) Ross Law Group refused to satisfy the judgment, asserting it had ceased operations before it settled the underlying litigation and had no assets. The trial court amended the judgment by adding an individual (Ross) as a judgment debtor. (Id. at p. 1187.) The appellate court affirmed, finding substantial evidence that Ross actively participated in and controlled the litigation on behalf of Ross Law Group, encouraged the lawsuit to proceed against the law firm to resolve the coverage litigation while knowing Ross Law Group was a dissolved entity without funds, unfairly led Carolina Casualty and the court to believe Ross Law Group was the proper defendant, and revealed the truth only after entry of the judgment. (Id. at pp. 1189-1194.) Accordingly, the equities overwhelmingly favored affirmance of the trial court's ruling. (Id. at p. 1193.) In short, Carolina Casualty ruled that it was within the court's discretion to amend the judgment to include an individual because he, not his defunct law firm, was actually the one controlling the litigation, and he failed to disclose that the law firm had no assets.