Legal Question in Investment Law in California

The Topanga Canyon Mutual Water Company was incorporated in 1928 in California, and its current status is "suspended," which is one of the least-promising categories for the stock to have any value. The best would be "active" with "merged out" as a close second (since the company it was merged into might honor the shares). Other possible statuses include "dissolved" and "surrender." When a company allows itself to be suspended rather than formally dissolving, that's a bad sign, indicating no money and nobody cares anymore.

Unfortunately, the public, on-line records don't show why it was suspended, or when. Usual reasons for suspension are failure to file periodic information reports to the Secretary of State showing officers, directors, address, etc., or failure to report and pay taxes to the Franchise Tax Board.

Information from a Google search indicates this company still existed in 1961 but not in 2006, and that its service area is now served by a Los Angeles County Water District, probably the one called "Malibu."

Your certificate probably has value as a collector item. Values in the $10 - $50 are are perhaps most common, but it depends on age, attractiveness, rarity, and the size of the audience interested in that particular company. You might also ask the Malibu Water Dist. if they bought out the Topanga mutual operation and if so if the former shareholders were paid anything.

Finally, if you are s shareholder in a suspended company, you can revive the corporation by filing an application for a certificate of revivor and paying all the back taxes. Probably not what you'd want to do, I suppose!

The water rights and water service of the company was taken over by the Los Angeles Department of Power and Water on August 29, 1961. Given the nature of the company, I expect it was a mutual benefit corporation, not a for-profit entity anyway. The shares would represent an interest in water rights and the infrastructure to deliver it. Think of it as being similar to the way condo owners own an interest in the HOA. Since the DPW gave an infrastructure credit (meaning the owners did not have to pay DPW fees to have water service brought to their area) in 1961, and DPW owns the infrastructure and water rights, even if the corporation were to still exist it would have no value.