Legal Question in Business Law in California

I have quick questions, hopefully I have worded them to be “yes/no”, but any explanation is superb.

1. A business is a partnership (between man and wife) and I have a small claim against the business. I know that I only have to file against one member. However, my question is: if I feel the male is going to show up to the court to testify regardless, can I have the female served so that both show up?

2. (Follow up) Is this a wise decision, or should I only have the male served so that the female can avoid appearing, thus separating the partnership while in court?

3. If in my case I request compensation for 3 issues; a refund of service paid for but not rendered, a refund due to over-payment of service received, and reimbursement for funds used to fix a mistake in service. And the business offers compensation for 1 of those 3 issues. Should I accept this refund? i.e. does accepting some form of compensation hinder my case and or imply that my case was resolved by accepting funds?

Thank you for you help.

Asked on 7/03/13, 4:56 pm

2 Answers from Attorneys

Kelvin Green The Law Office of Kelvin Green

You need to name all dispensable parties to the lawsuit. You probably ony have one shot at this. File against the business name, and each person as partner. Be sure it is a partnership and not an LLC or something must serve them all.

Sue correctly dont worry about who will show up and in what capacity.

What you have to be careful of is that if you sue and they make an offer personally unless it is the full amount you want or not a far compromise I woukd reject it so it does not look, act or feel like a settlement offer.

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Answered on 7/03/13, 6:21 pm

Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Under current partnership law, partnerships are considered entities in themselves, and can be sued as such. Corporations Code section 16201 says "A partnership is an entity distinct from its partners."

CC section 16305(a) says "A partnership is liable for loss or injury caused to a person, or for a penalty incurred, as a result of a wrongful act or omission, or other actionable conduct, of a partner acting in the ordinary course of business of the partnership or with authority of the partnership."

CC section 16306(a) says ".......all partners are liable jointly and severally for all obligations of the partnership unless otherwise agreed by the claimant or provided by law."

Finally, note Corporations Code section 16307(c) which says "A judgment against a partnership is not by itself a judgment against a partner. A judgment against a partnership may not be satisfied from a partner's assets unless there is also a judgment against the partner." The other subparts of section 16307 are also worth noting.

Based on the statutory scheme, I believe it is wise to name all partners and the partnership itself as co-defendants. Then, be sure that the factual allegations of the complaint are written so as to implicate all parties in at least some of the alleged wrongdoing.

You can't exercise complete control who will appear in court. That will be governed in part by the defendants' choices and in part by law. For example, unless called as a witness, an individual defendant need not be present, and may be represented by counsel. Indeed, a partnership cannot appear through a non-attorney partner acting "in pro. per." -- see, e.g., Clean Air Transport Systems v. San Mateo County Transit District (1988) 198 Cal.App.3d 576.

Finally, in drafting the summons and complaint, the format in which the defendants are named should make it abundantly clear that the partnership itself is intended to be a defendant, as well as the individuals.

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Answered on 7/04/13, 10:59 am

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