Can't Hide by Not Registering
by Ron Davis
Efforts to track down the elusive owner of a Delaware shopping center have proved challenging, to say the least.
Such efforts, however, became essential for a woman who suffered an injury at the shopping center, then couldn’t locate the center’s owner to seek retribution.
The shopping center is Crossroads Shopping Plaza, located in the Wilmington area, and the woman’s injury occurred while visiting a Family Dollar store that is one of the center’s tenants. She claims that while walking through the store, she fell when she stepped in a puddle of water that had accumulated on an aisle floor. She also contended that the puddle resulted from rainwater that had seeped through a defectively built roof of the store.
The woman’s lawsuit also included a claim against Family Dollar Stores, Inc., which then sued the shopping center’s owner for “contribution.”
The problem in locating the shopping center owner arose when the woman began trying to name the object of her lawsuit. First, she conducted a title search at the county recorder of deeds office. The shopping center deed showed a purchase of the property was made in 1959. Later, the purchaser apparently leased a portion of that property to Family Dollar.
The woman also discovered that despite having purchased the shopping center, the buyer never registered to do business in Delaware. Such registration in that state is required by law.
Finally, she learned that the shopping center owner had changed the name of his company, but never made an appropriate legal filing to disclose the name change. Such filing is also required by Delaware law.
The woman nevertheless pursued her lawsuit, and a Delaware court ruled against the center’s owner. Through mediation, she settled her claim against Family Dollar for $25,000. Later, the court also awarded her $125,000, to be paid by the shopping center’s owner.
Subsequently, the center’s owner registered as a business entity in the state of Delaware. The owner then claimed that because he had never received notice of the woman’s lawsuit, he should be excused from the award against him. The fault, he added, lies in the fact that the woman erred in properly identifying the real owner of the shopping center.
The Delaware Supreme Court rejected that argument, explaining, “Had Crossroads’ owner properly registered with the Delaware Secretary of State, the Secretary would have been able to provide the correct name and address on which to serve the woman’s complaint. Because Crossroads’ owner failed to do that, she was forced to investigate on her own. There is no evidence that her search was unreasonable…. Her efforts to serve Crossroads’ owner were in fact manifestly reasonable. The Crossroads owner’s own failure to comply with legal requirements—not any omission by her—is what caused [him] not to receive the complaint and its subsequent failure to respond.”
(Centralia Mining Co. v. Crawford, 2011 WL 491017 [Del.Supr.])
Decision: February 2011
Published: February 2011