Constantine Cannon, LLP v. Mullen Management Co, Inc.
August 5, 2020
In Constantine Cannon, LLP (“Constantine”) v. Mullen Management Co., Inc. (“Mullen”), the D.C. Court of Appeals considered whether a contract was valid when one of the parties to the contract was a foreign corporation, whose registration in D.C. was revoked at the time the contract was entered. Mullen is a Delaware corporation that owned and leased an office building. Constantine is a law firm, who entered into a lease agreement with Mullen in November 2007. Constantine began to make improvements to the leased space, but had a dispute during the construction, and refused to complete the renovations or proceed with the lease. After this dispute arose, Constantine determined that Mullen’s registration with D.C. had been revoked in September 2007, and contended that the lease was void. The Court made a distinction between domestic corporations having their articles of incorporation revoked, and a foreign corporation having their certificate of authority revoked. In the former case, the domestic corporation cannot enter into contract when its articles of incorporation are revoked because the corporation is deemed to have been dissolved. In the latter case, the foreign corporation can enter into a contract because it is still a corporation. However, the foreign corporation may face other penalties for allowing their certificate of authority to be revoked. The court held that the contract between Constantine and Mullen was valid and enforceable despite the revocation of Mullen’s certificate of authority.