Opinion ID: 328803
Heading Depth: 3
Heading Rank: 1

Heading: The Partnership Theory as a Bar to Capacity to Sue

Text: 37 The district court was in error in finding that plaintiff lacked capacity to sue for the period prior to May-June 1972, on the theory that plaintiff and his carriers were in a partnership and only a partnership could bring the suit. 38 The theory of limited capacity to sue for partners is based on California law as incorporated by reference in Rule 17(b) of the Federal Rules of Civil Procedure. Under California law the failure to raise at the outset of a case an objection to a plaintiff's alleged lack of capacity to sue is a waiver. Leh v. General Petroleum Corp., 165 F.Supp. 933 (S.D.Cal.1958). In this case the issue was raised after the commencement of the trial. 39 In addition, the evidence relied upon by the court to find a partnership was insufficient. For the period in question the carriers made collections from the subscribers, kept 20 percent of the gross proceeds, gave Blankenship 80 percent of the proceeds, and if a subscriber failed to pay his bill did not have to pay Blankenship the amount owed. This was apparently the evidence relied upon by the court. Under California law the sharing of gross returns does not alonease, in fact, shares few of the attributes of partnership. The carriers had no communiase, in fact, shares few of the attributes of partnership. The carriers had no community of interest with one another; they had no management role; they did not share in each other's profits or losses; they did not share in Blankenship's risks except to the limited extent of losing their profit if a subscriber failed to pay; there was no writing between Blankenship and the carriers indicating a partnership. See Constans v. Ross, 106 Cal.App.2d 381, 386, 388-89, 235 P.2d 113, 116, 117-18 (C.A.1951). In fact, a minor could not legally be a partner in California since a minor cannot delegate power, Cal.Civil Code § 33, and a delegation by a partner to the other partners is required, Cal.Corp.Code § 15009. 40