Pellegrin & Levine, Chartered v. Antoine, 90-7187

• Decision Date: 24 April 1992
• Docket Number: No. 90-7187,90-7187
• Citation: 961 F.2d 277,295 U.S. App. D.C. 190
• Parties: , 22 Fed.R.Serv.3d 888 PELLEGRIN & LEVINE, CHARTERED, Appellant, v. Phillip R. ANTOINE, et al.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 277

961 F.2d 277

295 U.S.App.D.C. 190, 22 Fed.R.Serv.3d 888

PELLEGRIN & LEVINE, CHARTERED, Appellant, v. Phillip R. ANTOINE, et al.

No. 90-7187.

United States Court of Appeals District of Columbia Circuit.

Argued March 5, 1992.

Decided April 24, 1992.

Appeal from the United States District Court for the District of Columbia (Civil Action No. 87-00096).

David J. Frantz, Washington, D.C., for appellant.

Eugene R. Fidell, Washington, D.C., for appellee, Vuong-Antoine.

Before: WALD, SENTELLE and HENDERSON, Circuit Judges.

Opinion for the Court filed by Circuit Judge WALD.

WALD, Circuit Judge:

In the District of Columbia an action against a partnership must be brought in the names of the individual partners and each partner must be served individually. In this case, a Washington, D.C. law firm sued a two-person partnership in a fee dispute, but failed to heed this well-established rule, serving only one of the two partners. The fee dispute resulted in a consent judgment, signed only by the partner that was served. We are now asked by the firm to overturn the district court's order vacating the consent judgment as to the other, non-served partner. Finding no reason to depart from the standard rule of service, we affirm the district court's order of vacation and its dismissal of the firm's suit against the non-served partner.

I. BACKGROUND

In October, 1983, appellee Phillip Antoine formed a general partnership with his then wife, appellee Lan Thi Vuong-Antoine, for the purpose of applying to the Federal Communications Commission ("FCC") for a permit to construct and operate a new radio station in Hawaii. In May, 1984, while the Antoines were living apart with the intent of terminating their marriage, ¹ Antoine and Vuong-Antoine entered into a fee agreement with the law firm that Antoine had retained to represent the partnership before the FCC, appellant Pellegrin & Levine, Chartered. ² Vuong-Antoine's liability under the agreement was conditional and limited. The agreement provided that she would be liable for fees "if and only if the Antoines [were] the successful applicants for the FM construction permit, and then only for 50% of the total fees." ³

In mid-December, 1986, Pellegrin & Levine withdrew as counsel for the Antoine general partnership and in January, 1987, filed this diversity action against both Antoine and Vuong-Antoine to recover over $150,000 in fees and unreimbursed costs. Pellegrin & Levine attempted to serve Antoine at his home in Honolulu, Hawaii and Vuong-Antoine both in Honolulu and in Anchorage, Alaska (at a location described by her in the FCC proceedings as a temporary residence). While the firm successfully served Antoine, it failed to serve Vuong-Antoine. To this day, Vuong-Antoine has not been served in the fee proceeding.

Upon Pellegrin & Levine's withdrawal as counsel for the Antoine partnership, Robyn Nietert, a Washington, D.C. attorney specializing in communications law, assumed the representation of the partnership before the FCC. In addition, as an "accommodation" to Antoine, Nietert entered an appearance in this fee action. That appearance, however, was expressly confined to the representation of Phillip Antoine. ⁴ At no time was Vuong-Antoine represented before the district court, nor did Vuong-Antoine herself make an appearance before the district court.

Nietert participated in settlement negotiations between Pellegrin & Levine and Antoine, and on March 26, 1987, the parties entered into a settlement agreement. ⁵ One term of the agreement provided that Antoine would enter into a consent judgment establishing both his and Vuong-Antoine's joint and several liability for $100,000 in legal fees. Antoine signed the consent judgment, which was entered on April 6, 1987, in the same manner that he had signed the settlement agreement: "Individually and on Behalf of His Partner, Lan Thi Vuong-Antoine."

After obtaining the consent judgment, Pellegrin & Levine placed a lien on a house owned by Vuong-Antoine in Hawaii. Vuong-Antoine then moved, in February, 1988, to vacate the consent judgment on the grounds that she was never served with process and that "her former husband, defendant Phillip R. Antoine, signed the consent judgment on her behalf without her knowledge or authorization." The district court agreed and vacated the consent judgment as to Vuong-Antoine. The district court also dismissed Pellegrin & Levine's complaint against Vuong-Antoine, finding that the firm had failed to demonstrate "good cause" for its failure to serve her within 120 days of the filing of the complaint.

Pellegrin & Levine challenges both rulings. First, it argues that Antoine, as Vuong-Antoine's partner, had authority to consent to judgment on behalf of Vuong-Antoine, and that his consent constituted a waiver of Vuong-Antoine's objections to sufficiency of process. Brief for Appellant ("Appellant") at 11. Pellegrin & Levine also argues that even if Antoine lacked authority to enter into the consent judgment on Vuong-Antoine's behalf, Vuong-Antoine is now estopped from denying that authority because Pellegrin & Levine reasonably relied on Antoine's "apparent authority" to enter into the consent judgment on her behalf, and because Vuong-Antoine benefitted from the consent judgment and has not acted in good faith in this proceeding. Finally, Pellegrin & Levine argues that the district court abused its discretion in dismissing the complaint as to Vuong-Antoine. Appellant at 18.

II. DISCUSSION

A. Vacation of the Consent Judgment

1. Antoine's Authority to Consent to Judgment on Vuong-Antoine's Behalf

Pellegrin & Levine recognizes the rule in the District of Columbia that in order to sue a partnership each partner must be individually served. See Matson v. Mackubin, 57 F.2d 941, 941-42 (D.C.Cir.1932); Affie, Inc. v. Nurel Enters., Inc., 607 F.Supp. 220, 221 (D.D.C.1984); see also 2 JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE p 4.24, at 4-221 (2d ed.1988). It attempts to overcome its failure to follow the rule in this case by arguing that Vuong-Antoine waived any objection to insufficiency of service and therefore voluntarily subjected herself to the court's jurisdiction. See Combs v. Nick Garin Trucking, 825 F.2d 437, 442 n. 42 (D.C.Cir.1987) (stating the basic rule that a party can waive objection to insufficiency of service). Clearly Vuong-Antoine never expressly waived objection; neither she nor an attorney on her behalf ever appeared before the district court. Rather, Pellegrin & Levine argues that Vuong-Antoine impliedly authorized Antoine to consent to judgment on her behalf and that therefore his consent waived her objection to insufficiency of service.

Assuming, without deciding, that one partner can authorize another to consent to judgment on her behalf, ⁶ and that such authorization can be implied from the conduct or acquiescence of the allegedly authorizing partner, ⁷ nothing in this record even remotely suggests that Vuong-Antoine authorized Antoine to consent to judgment on her behalf. Pellegrin & Levine first argues that because Vuong-Antoine was aware of both the complaint and the consent judgment but did not protest or challenge the consent judgment until ten months after its entry, she impliedly acquiesced in Antoine's representation of her interests. Pellegrin & Levine believes its argument of "authorization by acquiescence" is buttressed by the fact that even after Vuong-Antoine protested the consent judgment, she continued to assert the existence of her partnership with Antoine with respect to the FM license application and entered into a settlement of those proceedings with Antoine acting as her authorized agent. Appellant at 15.

We fail to see, however, how the conduct to which Pellegrin & Levine points leads to the conclusion that Vuong-Antoine impliedly authorized Antoine to consent to judgment on her behalf. The failure to object to a void judgment in and of itself certainly does not demonstrate approval of or acquiescence in that judgment. Vuong-Antoine's decision not to immediately challenge the consent judgment just as plausibly supports the inference that she believed it was invalid for lack of service and simply saw no need to challenge it unless and until Pellegrin & Levine attempted to enforce it. Nor does the fact that she authorized her partner to negotiate with the FCC support the conclusion that she also authorized him to consent to judgment on her behalf in the fee dispute. Members of a partnership typically are authorized to act on behalf of the partnership for purposes within the scope of partnership business. Were such general authorization sufficient to prove authorization to consent to a judgment, the rule requiring service on all partners would be meaningless. We decline to open such a gaping hole in the District of Columbia's long-established rule regarding legal actions against partnerships.

The second aspect of Vuong-Antoine's behavior from which Pellegrin & Levine attempts to derive implied authorization to Antoine to consent to judgment on her behalf does not even involve conduct by Vuong-Antoine at all. Pellegrin & Levine argues that Nietert's deposition testimony that she thought that Antoine had authority to consent to judgment on behalf of Vuong-Antoine supports the conclusion that Vuong-Antoine authorized Antoine to consent to judgment on her behalf.

Nietert's testimony is, in fact, somewhat equivocal. She stated only that she assumed that Antoine had authority to bind the partnership. Nietert Deposition at 47. More importantly, however, considering the fact that Nietert never met Vuong-Antoine, id. at 6-7, never even spoke to Vuong-Antoine, id., and entered her appearance in this case solely on behalf of Antoine, Nietert's perception as to Antoine's authority is only remotely, if at all, relevant to the question of whether Vuong-Antoine did indeed authorize Antoine to consent to judgment on her behalf. In sum, we find...