Columbia Star Milling Co. v. Brand

| Miss. | Oct 15, 1917

Sykes, J.,

delivered the opinion of the court.

The appellee, John Brand, filed a bill in the chancery court of Clay county, Miss., making as defendants thereto Edward F. Sehoening, Columbia Star Milling-Company, and David Cottrell. The material allegations of the bill are that the complainant had executed and delivered to the defendant, Sehoening, a trust deed conveying to Cottrell as trustee certain land in Clay county to secure the payment of a promissory note for $600, with interest; that the complainant had been‘in the employ of the defendant, Sehoening to sell flour manufactured by the defendant milling company, but that Sehoening was the real owner of the mill and was doing business under the name and style of the Columbia Star Milling Company, a few shares of stock being owned by his relatives; that he was employed under a yearly contract for a salary of $250 a month to sell flour; that for no just cause Sehoening required him to resign his position before his time had expired, thereby causing him to be damaged in a certain sum. This sum he desires to have ascertained by the court and credited on the amount that he owes Schoening on the note secured by the deed of trust, and that the contemplated sale of the property embraced in the deed of trust be enjoined until the court ascertain the amount, if any, due Schoening or the mill after the above credit is given complainant. This bill was answered by the defendant, Schoening, alone. He denied all of the material allegations of the bill and alleged that the Columbia Star Milling Company was a foreign corporation doing business under the laws of the state of Illinois; that the note and deed of trust were the individual property of the defendant, Schoening. He also denied that any indebtedness was due complainant by the Columbia Star Milling Company. The bill was not answered by the Columbia Star Milling Company. Proof of publication for the defendant corporation was duly made. Some time after the proof of publication had been made the original bill was amended so that the charge was made in it that the Columbia Star Milling Company was a corporation of the state of Illinois. . The original bill was filed on April 5, 1915. Personal service was attempted to be had on the nonresident corporation by the issuing of a summons directed to it on September 6, 1915, which summons commanded it to appear before the chancery court of Clay •county at rules on the 13th day of September, 1915. This summons was served, as is shown by the return of the sheriff herein quoted:

“I have this day executed the within writ personally "by delivering to J. F. Evans, a traveling salesman of •the Columbia Star Milling Company, a true copy hereof. Witness my signature this September 6, 1915. Sid A. Deans, Sheriff.”

A copy of this process was not mailed to the home ■office of the corporation by registered letter, as is required by section 920 of the Code of 1906, until the 30th day of December, 1915. A term of the chancery court had been held between the service on J. F.. Evans and the mailing of the registered notice. At the November term of the court the complainant filed a motion for a decree pro confesso' against the Columbia Star Milling Company, which had filed no answer and made no appearance. The learned chancellor in overruling this motion filed a written opinion upon the-same, which we here quote in full:

“This cause came on for hearing on motion of complainant for a decree pro confesso against the Columbia Star Milling Company, Edward F. Schoening having prior to that time filed answer to the bill, and his-counsel, Gates T. Ivy, appeared and made an argument against the motion for a decree pro confesso as to the Columbia Star Milling Company, claiming that he was not appearing in any sense of the word for the Colombia Star Milling Company, yet made a very extensive and ingenious argument against the sustaining of said motion, it being claimed by the complainant that this appearance is the appearance of the Columbia Star Milling Company.

“In the hearing of a motion of this kind, it is necessary for the court to understand the nature of the-original bill upon which process was based, and to ascertain whether or not prop-er service has been made. It is the contention of Mr. Ivy that proper process upon-the Columbia Star Milling Company has not been made.. It is conceded by the counsel for complainant in this-cause that possibly the service of the process is deficient, inasmuch as a copy of the process was served upon Mr. J. F. Evans, traveling salesman or'traveling agent of the Columbia Star Milling Company, and was-not sent to the company by registered letter by the clerk who issued the process. Under our law, as I understand it, any appearance of any nature by a defendant is an appearance final.

“Now, the question arises as to whether or not the appearance of the attorney, who represented the president of the' Columbia Star Milling Company, the defendant herein, and who, by his answer, owns seven hundred and thirty shares- of the capital stock of the Columbia Star Milling Company, and who is charged in the bill as owning virtually the entire stock of the Columbia Star Milling Company, as to whether or not his appearance is the appearance of the Columbia Star Milling Company, without having filed any papers in the case. I am of the opinion that this appearance constitutes sufficient appearance of the Columbia Star Milling Company to put them into court.

“Let the motion, therefore, for a decree pro confesso. be overruled and the Columbia Star Milling Company be given until nest term of this court to file its answer and the application of complainant to amend his bill by adding the following therein, after the words, ‘Columbia Star Milling Company,’ first appearing in the bill, to wit, ‘a corporation under the laws of the state of Illinois, with its domicile at Columbia, in said state,’ is granted and complainant may amend his bill at any time before the filing of the answer of the Columbia Star Milling Company, and within thirty days from this date should the answer be immediatelv filed.”

The Columbia Star Milling Company, after the above -decree was entered, never answered the bill nor attempted to make any defense to the suit. On final hearing decrees pro confesso and final were entered .against the Columbia Star Milling Company for the amount complainant claimed due him under his contract for services. The chancellor in this decree in part says':

, “And it appearing to the satisfaction of the court that service of process was had upon said defendant, the Columbia Star Milling Company, according to section 920, Code 1906, and that this court by decree filed November 12, 1915, found that said defendant, the Columbia Star Milling Company, had made appearance, in this court by attorney in resisting a motion for decree pro confesso, at said term, and the said defendant given until the present term to answer. ’ And it appearing that said the Columbia Star Milling Company has failed to answer or to file any plea in this cause.”

lie also found in favor of the defendant, Schoening, on the other issues in the case. From this decree the defendant the Columbia Star Milling Company prose•cutes this appeal.

There are but two questions -involved in this appeal: First, was any personal service had upon the Columbia Star Milling Company, an Illinois corporation? Second, did the attorney of record of Mr. Schoening enter an appearance for this corporation by his argument •against sustaining the first motion for a decree pro •confesso9

Of course, no personal judgment could be entered ■against this defendant on publication of process. The only question then to be considered on this proposition is whether or not the attempted service on J. F. Evans, as agent of this corporation, on September 6, 1915, ■and the mailing of a copy on December 3.0, 1915, was a compliance with section 920 of the Code. This section says that “it shall be the duty of the clerk to immediately mail a copy of the process to the home office of the corporation by registered letter.” It is also to be remembered that this summons called for the appearance of the corporation in court at rules on September 13, 1915'. In other words, several months had expire before the copy was mailed to the home office of this defendant, and the return day had also passed, The summons was functus officio, its return day having passed. The statute was not complied with, in that the copy was not immediately mailed. This is a necessary part of the service of summons in order to bring a defendant in court.

The next question is: Did Mr. Ivy, the attorney of record of the defendant, Schoening, by his suggestion, or argument to the court that the Columbia Star-Milling Company was not properly in court thereby enter an appearance for the Columbia Star Milling Company? Mr. Ivy was an attorney of record in the case, representing the defendant, Schoening, in his individual capacity. The defendant, Schoening, and the Columbia Star Milling Company are two separate parties, one being an individual and the other a corporation. Each must be properly brought into court before-he be required to answer its orders. As an attorney in the case, we think it was clearly the right of Mr. Ivy to suggest to the court that any proposed motion in the-ease should be overruled. .He had this right as an attorney of one of the defendants. He also had the-right to make this suggestion as amicus curiae. The' opinion of the chancellor expressly states that Mr. Ivy disclaimed representing the defendant, Columbia Star Milling Company. The learned chancellor wa« persuaded that this was an entry of appearance of the-Columbia Star Miling Company because Schoening was the president of this corporation and was its principal stockholder and its active manager, and in his individual answer to the bill he set up all of the defenses that he thought could have been set up by the corporation. This all may be true; however, this answer of Schoening was his separate answer, and was treated as such by the court, and was not considered as the joint answer-of Schoening and the corporation. As a defendant in the case he had a perfect right to answer fully all of the allegations of the bill. The final decree of the court, in this case did not treat this answer as one of the defendant corporation, but entered a decree pro confessoagainst it.

We therefore conclude that the attempted service-under section 920 of the Code of 1906 was void, and that there was no voluntary appearance of the appellant corporation in this case. The decree of the lower •court is reversed, and the cause remanded, with leave lo the appellant, Columbia Star Milling Company to plead, answer, or demur to the bill within sixty days after the mandate of this court is filed in the court •below.

Reversed and remanded.