Plaintiffs, the buyers of an apartment complex, appealed an order from the Superior Court of Sacramento County (California), which, in a suit asserting breach of contract and other causes of action related to a mold problem in the complex, quashed service and dismissed the complaint against defendants, two Delaware entities that were limited partners of the seller.
The seller, an Oregon limited partnership, owned and operated an apartment complex in California. The limited partners had no other property interests in California, conducted no business in California, and did not actively participate in the operations of the partnership. The court held that the limited partners' passive investment in the PAGA statute of limitations partnership did not subject them to personal jurisdiction under Code Civ. Proc., § 410.10. Although the limited partners were subject to taxation in California on partnership income earned there, merely being subject to taxation did not provide a basis for personal jurisdiction over a nonresident limited partner. The court noted that limited partnerships were treated as associations of individuals for income tax purposes but as discrete entities for other purposes, including proceedings by or against the firm, as indicated in Corp. Code, former § 15526. Moreover, even if the investment activities of a limited partner could constitute minimum contacts with respect to claims arising from those activities, the claims at issue did not arise from the limited partners' activities because they did not participate in managing the apartment complex. The court affirmed the order quashing service and dismissing the complaint against the limited partners. Petitioner insurers filed a writ of mandate seeking review of the decision from the Insurance Commissioner (California) that found that petitioners had violated the mandatory renewal provision of Proposition 103 because the provision applied to all policies in force on the effective date, regardless of the steps the insurers took to withdraw from the California insurance market. Petitioner insurers sent the Department of Insurance (Department) their applications to withdraw as insurers, along with their certificates of authority, surrendered for cancellation. The next day Proposition 103 (103) was enacted and included a mandatory renewal provision. The very next day, applicants issued notices of nonrenewal to their California automobile insurance policyholders on a blanket basis. The Department served petitioners with notices of noncompliance and alleged that the nonrenewal notices they issued after the effective date of 103 violated the mandatory renewal provision. After a hearing, the commissioner concluded that the mandatory renewal provision applied to all policies in force on the effective date of 103, regardless of steps taken by the insurer to withdraw from the insurance market. Accordingly, the commissioner found that petitioners had violated the mandatory renewal provision. Petitioners filed a writ of mandate. After review, the court concluded that the mandatory renewal provision did not apply to an insurer who had commenced the withdrawal process. Accordingly, the writ was granted and the commissioner was ordered to set aside her decision. The petition for peremptory writ of mandate was granted and respondent insurance commissioner was commanded to set aside her decision and order because the mandatory renewal provision of Proposition 103 did not apply to an insurer who had commenced the withdrawal process.
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