242 F. 243 | 6th Cir. | 1917
This is an appeal from an order adjudicating bankruptcy. It presents a conflict of jurisdiction over the administration of the bankrupt’s estate, due to the pendency of proceedings in both the Eastern District of Kentucky and the Eastern District of Tennessee; the pivotal question (and the only one presented here) being in which of the two districts did the bankrupt have its principal place of business for the six months preceding May 5, 1916? Upon review of an order of the District Court for the Eastern District of Kentucky we held that that court, having first asserted jurisdiction, took constructive possession of the bankrupt’s estate and should retain the case for the purpose of determining its own jurisdiction. In re Continental Coal Corporation, 238 Fed. 113, - C. C. A. -. Upon a reconsideration of the case the court below, adhering to its former opinion (235 Fed. 354), held that the bankrupt’s principal place of business was in the Eastern District of Kentucky. Adjudication of bankruptcy followed. ■ •
The corporation complied with the laws of Kentucky relating to the doing of business by foreign corporations in that state, including the appointment of a resident agent for service of process. It did not comply with the laws of Tennessee in these respects. After the filing of involuntary proceedings in the Eastern District of Kentucky, the corporation caused voluntary petition to be filed in the Eastern District of Tennessee.
In this state of facts the question is narrowed to this: In which of the two localities — the City of Chattanooga, Tenn., or Bell county, Ky. —was the corporation’s “principal place of business”? Appellants contend that, as applied to the facts of this case, the corporation’s principal place of business—
“is that place from which supreme direction and control of its affairs is exercised, where its executive offices are located, its stockholders and directors meet, its books and records are kept, its banking and financial transactions handled, and all component parts of its business regulated and directed, as a whole.”
Cases are cited in which, as applied to the facts there presented, the features mentioned have been regarded as dominating.
But we think the place where the principal office is located is not necessarily the place where the principal business is carried on. Such may or may not be the case. Nor as between the place where a.mining corporation’s actual operations are carried on and the place where the selling is done and the principal office maintained can the latter be declared in all cases, as matter of law, the principal place of business. All the authorities recognize, as do counsel, that the question as to the place where the bankrupt carried on its principal business is purely one of fact. Each case depends upon its own special circumstances. Neither of the cases cited by appellants is on all fours with the instant case. Where a corporation has more than one mine, quarry, or manufacturing plant, situated in different districts, its office from which supreme direction and control of the business generally is had, including the operations of the several plants, may, and perhaps must, be deemed the principal place of business. Such was the case in the Slate Company Case. But that consideration does not apply to the case here. The same may be said of the case, suggested by way of illustration, of a railroad running through several jurisdictions. Nor need we be concerned with the test sometimes applied, by way of comparing the volume of business done at different places. The test of volume of business in terms either of output or of dollars and cents is not pertinent to the situation before us.
“it is the production end of Ms [the mine operator’s] business that is the prominent feature and is expressed in his name. No one ever speaks of a manufacturer or mine operator as a merchant or seller of goods, but always :is a manufacturer or mine operator.”
Taking into account the entire situation, we are better content with the view that the debtor’s principal place of business was the place where these extensive mining operations, as well as the other business mentioned, were carried on, where the maps and original deeds of the company’s property were kept in a vauit prepared for that purpose, where this large number of company houses and the important commissary stores were maintained (a village of themselves), whére the bulk of the bankrupt’s property was situated, and where suits and liens against it would naturally be enforced (in fact, several personal injury suits were pending when the testimony below was taken), and where its superintendent and manager actually resided, rather than the office in Chattanooga, in which the books were kept, the general guidance of its business effected, and from which the selling was conducted. The retail coal business and the selling of coal bought, as well as that produced by the bankrupt, were incident to its dominant coal-mining business. We also think that the fact that the bankrupt complied with the Kentucky statute and not with that of Tennessee has a tendency, although not conclusive, “to show what was in effect its principal place of business,” and that this effect is not destroyed by the reason assigned that compliance with the Tennessee statute would require a considerable payment of fees, nor by the fact that, following the involuntary bankruptcy proceedings in the Eastern District of Kentucky, the debt- or, pursuant to a previously formed intention, filed a voluntary petition in the Eastern District of Tennessee. The contention that a corporation is presumed, as matter of law, to know the location of its principal place of business loses its force here from the fact that it required about two weeks’ investigation of facts and of law to reach a conclusion that the bankrupt’s principal place of business was in Chattanooga.
The order of the district court appealed from is affirmed.
In re Matthews Consolidated Slate Co. (D. C.) 144 Fed. 724, affirmed in Burdick v. Dillon (C. C. A. 1) 144 Fed. 737, 75 C. C. A. 603; In re Pennsylvania Consolidated Coal Co. (D. C.) 163 Fed. 579.
Ohio Valley Bank Co. v. Mack (C. C. A. 6) 163 Fed. 155, 158, 89 C. C. A. 605, 24 L. R. A. (N. S.) 184; Wabash Ry. Co. v. Compton (C. C. A. 6) 172 Fed. 17, and cases cited at page 21, 96 C. C. A. 603; Deupree v. Watson (C. C. A. 6) 216 Fed. 483, 485, 132 C. C. A. 543.