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Constantine Cannon LLP v. Mullen Management Co. Inc.

Court of Appeals of Columbia District

September 3, 2015

CONSTANTINE CANNON LLP, APPELLANT,
v.
MULLEN MANAGEMENT CO., INC., APPELLEE

Argued September 23, 2014

Appeal from the Superior Court of the District of Columbia. (CAB-3079-08). (Hon. John Ramsey Johnson, Trial Judge).

John Jay Range, for appellant.

S. Scott Morrison, with whom David C. Rohrbach was on the brief, for appellee.

Before WASHINGTON, Chief Judge, BECKWITH, Associate Judge, and KING, Senior Judge.

OPINION

Page 969

Beckwith, Associate Judge

At the time the events in this case took place, a foreign corporation[1] was required to obtain a certificate of authority from the mayor before transacting business in the District of Columbia. D.C. Code § 29-101.99 (a) (2001).[2] The mayor could revoke that certificate if, among other things, the corporation failed to pay required fees or file its two-year report. D.C. Code § § 29-101.115 (a), -101.122 (2001). The question presented in this case is whether a contract entered into by a foreign corporation after its certificate of authority was revoked for those reasons is nevertheless enforceable. We hold that it is, and accordingly affirm.

I.

Appellee Mullen Management Company, Inc., is a Delaware corporation that owns and leases an office building near McPherson Square in the city's northwest quadrant. Mullen obtained a certificate of

Page 970

authority to transact business in D.C. on December 30, 1996. Appellant Constantine Cannon LLP is a Delaware limited liability partnership whose attorneys practice law in the District. In early 2007, Cannon approached Mullen to inquire about leasing office space in Mullen's building. The parties signed a lease on November 30, 2007, and Cannon began to make improvements to the property as required by the lease. A dispute arose shortly thereafter regarding the building's air ventilation system, and Cannon directed its general contractor to stop work in February 2008. Cannon refused to pay its contractor, who then recorded a mechanic's lien on the property for nearly two million dollars.

Cannon then learned that Mullen's certificate of authority had been revoked on September 10, 2007, eleven weeks before the lease was signed, after the D.C. Department of Consumer and Regulatory Affairs determined that Mullen " failed and/or refused to file reports and pay all fees due and owing." Cannon sent Mullen a letter on March 6, 2008, contending that the lease was void for that reason. Mullen quickly applied to reinstate its certificate of authority, and the District issued a certificate of reinstatement on March 14, 2008. Mullen then sued Cannon for breach of contract. Cannon filed a counterclaim seeking (1) a declaratory judgment that the lease was void because Mullen's certificate of authority had been revoked prior to signing and (2) damages and an injunction against enforcement of the lease because the lease was induced by fraudulent misrepresentation. On cross-motions for summary judgment, the trial court ruled that Cannon breached the lease and the lease was not void even though Mullen's certificate had been revoked. Cannon amended its counterclaim six months later to add a new theory of fraud. After trial, the court entered judgment as a matter of law in favor of Mullen on both fraud claims and ordered Cannon to pay damages, attorney's fees, and costs for its breach of contract.

Cannon appeals the denial of its summary judgment motion, contending that the lease was void because Mullen's certificate of authority was revoked ...


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