Dwinell’s Central Neon v. Cosmopolitan Chinook Hotel

On October 25, 1972, Cosmopolitan Chinook Hotel (Cosmopolitan) (defendant) and Dwinell’s Central Neon (Dwinell) (plaintiff) entered into three separate agreements for the lease-sale of neon signs. Dwinell was represented by its salesman, and Cosmopolitan was represented by two of its partners. The agreements provided Dwinell with an acceleration clause should Cosmopolitan default. In October 1976, Dwinell brought suit for the accelerated balance of the agreement due to Cosmopolitan’s breach. Dwinell’s complaint claimed Cosmopolitan was a general partnership because Cosmopolitan had failed to comply with the limited-partnership filing requirements of the Uniform Limited Partnership Act at the time of entering into the agreements. Cosmopolitan claimed it was a limited partnership and its status was known to Dwinell. Cosmopolitan further claimed that it was common knowledge in the community that a limited partnership had purchased the Chinook Hotel. Cosmopolitan had filed for the certificate of limited partnership roughly 90 days after the agreements were executed, and it argued that Stowe v. Merrilees stood for the proposition that a reasonable time is implied in regard to substantial compliance with the limited-partnership filing requirements. Cosmopolitan further argued that one of its partners informed Dwinell’s salesman of its entity status by circling the word partnership in the agreement. The trial court granted Dwinell’s motion for summary judgment and held Cosmopolitan liable as a general partnership. Cosmopolitan appealed.