58 W. Va. 108 | W. Va. | 1905
Lead Opinion
By chapter 39, Acts 1905, the state auditor was constituted the attorney in fact for every foreign corporation doing business in this State, and for every non-resident domestic corporation, and every such corporation is required, by power of attorney duly executed by it, to appoint the auditor its
Writ Awao'ded.
Dissenting Opinion
(dissenting):
I cannot concur in holding that chapter 39, Acts 1905, wherein it requires non-resident domestic corporations to appoint the auditor attorney in fact to accept service of process ■ and notice, is constitutional. The defendant here was organized and now exists by virtue of a charter issued to it by the Secretary of State on the 18th day of January, 1902, and, on the 17th day of February, 1902, by power of attorney, duly executed, filed and recorded, as provided by section 24, chapter 54 of the Code, it appointed ffm.
The law, prior to the passage of this act, was entirely adequate to make process available against foreign and nonresident domestic corporations, and completely protected suitors against such corporations, by providing for the appointment of an attorney in fact to accept service of process, etc., and by requiring the power of attorney by which the appointment was made to be recorded; and just what called for the passage of chapter 39 is difficult to determine, unless it was for the purposemf increasing the State’s revenues. It does not afford any additional or more efficacious means of serving process, than existed prior to its enactment. Therefore, the act under consideration could be declared unconstitutional without, in the least, impairing the rights of any person who may desire to resort to the courts of this State for the enforcement of his rights against such corporation.
The selection, by a corporation, of its officers und agents, for the purpose of managing and conducting its business, of all kinds whatsoever, is the highest and most important right which can be exercised by it, because its business is conducted solely by its officers and agents, and under the provisions of the act in question the defendant is deprived of this paramount right, and instead thereof, the State has imposed upon it the duty of selecting the State auditor as such agent. The right to have notice of suit brought against it is an exceed
Judge Brannon, in delivering the opinion of the Court,, says: '‘If the State deprive the corporation of an essential, right, its action would not be held good.” In determining the. rights of a corporation, I fail to see what right or power is. more essential to the successful management and safety-of its business than the selection of its agents and servants,, and especially in the selection of an agent to accept service! of process for it, or upon whom service of process may bei had in any suit which may be filed against it. A failure to> notify a corporation of a suit pending against it, may mean absolute destruction to the corporation, without remedy. If the act in question is constitutional, and the State has the power to select an agent to accept service of process, then where does such power end? Would it not have the power to. select any other officer or agent of the company? If the-, corporation can be deprived of the agent of its own choosing-in one instance, why cannot the State deprive it of the selection of all its agents ? There is as much reason to say that, the State can appoint all as to say it can appoint one.' There is no public necessity for the appointment of an agent to receive service of process, until after the right of selection has first been given to the corporation, and it fails or refuses to exercise it.
What remedy is given the corporation where the auditor fails to notify it of any suit brought against it? Judge Bbaniíon- says: “Doubtless if the auditor fffils to warn the corporation of the suit, he would be liable on his official bond.” I know of no law that fixes any such liability on the auditor. The act in question does not do so. While it is
None of the authorities cited by the attorney for the State apply to this case. They refer to foreign corporations entirely, and in some of the cases the power of selection is first given to the corporation, with the provision that if it -fail to make the appointment, service may be had upon some State official, while in the other cases it is held that a foreign corporation can exercise the right to do business in a State only by comity, or as an act of grace on the part of the State, and the condition upon which the power is extended goes with it, and cannot be separated from it; so that if the privilege is enjoyed, the condition must be performed, and all corporations referred to in these cases were permitted to do business in the State upon the express condition that they appoint a certain person to accept service of process, etc. The case of Fisher v. Traders’ Mutual Life Ins. Co., 48 S. E. R., is attempted to be applied here. It has no application, because it gives the corporation first the power to select its own agent, and provides that if it fails to make the selection, process may be served on the secretary of the corporation commission. No such right was extended to this defendant. If so, it would have no just ground of complaint, and doubtless would not be complaining. And upon an examination of all the authorities cited by counsel for the State, it will be found that they do not support the State’s contention. The State should have the right to require non-resident domestic corporations to appoint an agent or representative in the State to receive service of process and notices in legal proceedings instituted against them, and to provide, upon their failure to make such appointment, that service may be had upon a public official, designated for that purpose, or in some other
“Judgment against corporation on leaving summons with recorder of deeds, though authorized by statute, is not by due process under the Fourteenth Amendment.” — Brannon’s Fourteenth Amendment, 263. And the author cites Pinney v. Providence Co., 82 N. W. 308, which decides that a statute authorizing service of process on a corporation by leaving a copy of such process with the register of deeds, is unconstitutional, as in violation of the Constitution of the United States declaring that no State shall deprive any person of life, liberty or property without due process of law. There are much stronger reasons for holding in this case that chapter 39 is unconstitutional, than there were for holding unconstitutional the act in the case just cited, for, by the Wisconsin statute, it was required that on or before October 1, 1898, the corporation file in the office of the register of deeds a list of the names of its officers, therein mentioned, on whom service of process, notices or orders, might be made as provided by another section of the statute, and provided further that in all cases where such list of officers was not filed as aforesaid, service of all legal process, notices or other legal proceedings, might be lawfully and effectually made upon any such corporation by giving to and leaving with said register of deeds true copies of such legal process, orders, notices or proceedings, in which case service so made .should be valid.
Then again, the defendant is required by this act to pay to the auditor, as its attorney, the stipulated sum of ten dollars for his services. Not only is the right to select its own agent taken ' away from the corporation, but it is deprived of the liberty to contract with its agent as to the compensation which such agent is to receive for his services.. Judge Beannon says: “The auditor is paid by the State, and the State, by its officer, renders valuable service to the corporation.” This may be true, but still it is no reason why the defendant can be deprived of the liberty to contract, as
In State v. Peel Splint Coal Co., 36 W. Va. 856, Judge Brannon, in delivering the opinion of theCourt, says: “The word ‘liberty,’ as here used, does not mean simply exemption from bodily imprisonment, but liberty and freedom to engage in lawful business, to make lawful contracts therein, to the end of earning a livelihood for self and family, and of acquiring and enjoying property, and of obtaining happiness. The right to contract and be contracted with is indispensable to these indispensable objects. * * * Yain would be the the pursuit of happiness if the right of contract necessary to secure the bread of life and raiment and home be taken away. Scarcely any of the great cardinal rights are more universally recognized and vindicated under our system, indeed under all civilized governments, than this righttof contract. ” I fully concur with the Court in construing this constitutional provision and defining the word “liberty” as embracing the right to contract and be contracted with, and if this is the proper construction, then it seems to me that no argument is necessary-to show that the act in question is unconstitutional, because it deprives the defendant of its right to contract with its agent. »
The validity of the act in question is upheld by the Court, by virtue of section 8, chapter 53, Code, for Judge Brannon, speaking’for the Court, says: “But for said section 8, we need not, do not say whether or not the act would be valid.” If chapter 39, Acts, 1905, is unconstitutional but for said section 8,1 fail to see how this section can rob it of its unconstitutional features, and render constitutional an unconsti
In Citizens Bank v. Owensboro,, 173 U. S. 636, and many other cases, it is said, in upholding the reserved powers to alter or repeal the charter of a corporation, that under such reservation the legislature may exercise the right without impairing the obligation of the contract. This is because the reservation qualifies the grant, and whenever the legislature exercises the power which it has expressly reserved, it does not impair the obligation of its contract, because it is a part of the contract that it shall be at liberty to exercise that power. It is not claimed that chapter 39 is invalid because it impairs the obligation of a contract, but because it is in conflict with the Fourteenth Amendment to the Constitution of the United States. The State cannot reserve unto itself the power to pass an unconstitutional act. Whatever power the State may possess over corporations in their creation, or in passing or amending the laws under which they are formed, it cannot withdraw from them the guarantees of the Federal Constitution.
The object of the reservation,, in whatever form expressed, was to preserve to the State control over the corporate fran
For the foregoing reasons, I would refuse the writ.