Braun v. Woolworths

A-6119-97T2 (N.J. Super. App. Div. 1999) (Unpublished)
  • Opinion Date: May 18, 1999

LIMITED PARTNERSHIPS; STATUS; SERVICE—When a limited partnership’s status is revoked, it becomes a general partnership; therefore, process can be served on any partner.

A personal injury action was commenced against individuals and some tenants in a shopping center as well as against fictitious parties. The injured party’s attorney had discovered an early lease between a retailer, as tenant, and two individuals, as landlord. Ultimately, service was made on the two individuals. During the course of making service, a title search disclosed that title to the property was actually vested in a limited partnership. The registered agent for the limited partnership was one of the individuals who had been served personally. The deed transferring the shopping center to the limited partnership showed the same individual as both preparer and as “general partner” of the grantor. The injured party’s attorney made numerous attempts to serve the limited partnership, in its own right, by attempting service on the very same individual who had been personally served in his own name. Ultimately, the Court, found that service had been made against the limited partnership, and issued a default judgment against the limited partnership. When the injured party began to garnish rents from the shopping center, the limited partnership objected, claiming that it had never been served in the first place. In the proceedings that followed, it came to be known that although the limited partnership was active at the time of the accident, its registration had been revoked (for failure to file an annual report), just a week before the initial complaint in the matter had been filed. The lower court accepted that the limited partnership’s liability must be determined by its status on the date that the cause of action arose and that any judgment entered against the individual partners could not bind the limited partnership. But the lower court pointed out (and the Appellate Division agreed), that “effectiveness of service” and “notices for statute of limitations purposes” are different questions entirely. Therefore, even when the limited partnership’s status was inactive, the individual defendant was the general partner and agent. For the purpose of providing notice, the fictitious pleading and service upon that individual were effective as to the limited partnership. In addition, once the initial complaint was filed, the limited partnership was already out of compliance with registration requirements. When a limited partnership loses its registration it becomes a general partnership. Consequently, service on any general partner constitutes service on the partnership. Therefore, when the complaint was served upon the individual who had been designated as the general partner, it was effective service on the limited partnership that had lost its registration. Having been served through its partner and agent, it was afforded every opportunity to defend, but it did not.