California Secretary of State Amends Certificate of Cancellation Form, But Is The Change Lawful?

Allen Matkins
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Allen Matkins

Last summer, I noted that the California Secretary of State's form of certificate of cancellation for limited partnerships required the statement that upon filing a certificate of cancellation, a limited partnership's powers, rights, and privileges "cease" even though that statement is not required by Corporations Code Section 15902.03. See A Vice Chancellor Strives To Untangle California's Limited Partnership Dissolution Statutes. Thereafter, I reached out to the Secretary of State's office. Yesterday, the Secretary of State's office release a revised form that changes the wording to read:

Upon filing this Certificate of Cancellation, the Limited Partnership’s registration shall be cancelled, and its powers, rights and privileges will cease in California as provided by law.

The changes are subtle, the new form refers to the "filing" rather than the "effective date" of the certificate, states that the registration "shall" rather than "is" cancelled, and adds "as provided by law".

While Section 15902.03 expressly authorizes the Secretary of State to prescribe the form of the certificate of cancellation, it requires only that the certificate include (i) the name of the limited partnership and its Secretary of State file number; (ii) the date of filing of the initial statement of limited partnership; and (iii) any other information determined by general partner or by the person appointed pursuant to Section 15908.03(c) or (d).

To the extent the Secretary of State's form of certification implements or makes specific the statute, it could be considered to be a regulation subject to the rulemaking provisions of the California Administrative Procedure Act, Cal. Gov't Code § 11340 et seq. State agencies may not use or enforce regulations that have not been adopted in compliance with the APA. Cal. Gov't Code § 11340.5.

Update to yesterday's post: After publishing yesterday's post, I received a note of clarification from the Department regarding the status of funding for the CalMoney Smart program. I have updated the post, accordingly. I always appreciate receiving corrections, comments and clarifications from readers.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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