Novelty Tufting Machine Co. v. Hutkoff

107 N.Y.S. 88 | N.Y. App. Term. | 1907

Lead Opinion

Gildersleeve, J.

The plaintiff brought this action to recover upon two promissory notes for the sum of fifty dollars each. Defendants appeared in the action by the same attorneys and interposed a demurrer to the complaint on the ground that it did not on the face of the complaint appear that plaintiff had legal capacity to' sue, as plaintiff did not allege compliance with section 15 of the General Corporation Law, as amended by chapter 538 of the Laws of 1901.* The demurrer was overruled, and both defendants interposed answers which admitted the making and endorsement of the notes sued upon. The defendant Nathan Hutkoff by his answer put in issue due presentation, non-payment and notice of dishonor. After formal proof tending to establish the liability of defendants, upon cross-examination of the president of the plaintiff corporation, it was elicited that plaintiff was incorporated under the laws of the State of Wisconsin and dealt with a number of people in this State; that plaintiff dealt in the last eight years with about thirty-five or thirty-six people; that the witness traveled once in a while and came to this State as a representative of plaintiff, and, as a rule, when coming to transact business, remained as long as two or three days; that the notes in question were given in payment for some machines that had been formerly sold by plaintiff to other persons, but that the original sales were cancelled, and the machines -were transferred to defendants. Upon this state of facts, defendants’ counsel moved to dismiss the complaint upon various grounds, including the failure to show compliance with the statute, which had been duly pleaded by defendants. In granting the motion, the trial justice said: “ I think on the whole that you have come squarely within the statute; that it affirmatively appears that your company (plaintiff) is a foreign stock corporation • that this contract was made in the State, and these notes were given in conformity with that contract.” We think this ruling was erroneous, for the reason that it did not appear that plaintiff corporation was doing business in the State within the meaning of the statute. There was no proof that it had a branch office in the State, or that it stored any merchandise in the State, or that it had a bank account in the State, or any established domicile for the transaction of business within the State. A reasonable conclusion to be drawn from the testimony is that it manufactured its machines in the State of Wisconsin, and occasionally shipped them to this State, pursuant to orders taken by agents within this State. To bring a foreign corporation within the purview of the statute, the establishment, of an agency or branch'office within the State must appear. As stated in Vaughn Machine Co. v. Lighthouse, 64 App. Div. 138. “ The statute contemplates a location and domicile, having an office and investment of some of its capital within the State.”

The judgment must be reversed and a new trial granted, with costs to appellant to abide the event.

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Concurrence Opinion

Leventritt, J.

(concurring). I concur. The evidence does not sustain a finding that the plaintiff is doing business in this State. The phrase “ doing business in this State ” has been held to imply corporate continuity of conduct, “ such as might be evidenced by the investment of capital here, with the maintenance of an office for the transaction of its business, and those incidental circumstances which attest the corporate intent to avail itself of the privilege to carry on a business.” Penn. Collieries Co. v. McKeever, 183 N. Y. 98. In this case there is hot an evidentiary fact or circumstance indicative either of action or intent on the part of the plaintiff.

Erlanger, J., concurs.

Judgment reversed and new trial ordered, with costs to appellant to abide event.