175 A. 587 | Pa. | 1934
This is an appeal from the order of the court below refusing to set aside the service of a summons in an action of trespass against sixteen defendants, none of whom were Pennsylvania residents, comprising the partnership of Lee, Higginson Co. This firm maintained offices in New York, Boston and Chicago, and branch offices in other cities including Pittsburgh, where its office was, from July 1, 1930, in charge of a manager named Gilliland. The firm was registered under the Fictitious Names Act of June 28, 1917, P. L. 645, 54 P. S., section 21, the names and residences of all the partners being listed and the fact that Gilliland was the firm's agent in Allegheny County being certified. On June 28, 1932, while this agent was in the Pittsburgh office, a deputy sheriff served him with a summons in a suit in trespass against the firm. The Acts of April 2, 1856, P. L. 219, section 1, and of April 21, 1858, P. L. 403, section 1, assuming them to be valid and assuming Gilliland to be defendants' agent, authorized the service made.1 *484
Counsel for the defendants appeared d. b. e. for the sole purpose of challenging the court's jurisdiction. Defendants filed a petition stating that they were nonresidents, that Gilliland had ceased to be in their employ on and after June 15th, that on that date they had ceased to do business in Allegheny County, that the court was without jurisdiction over them, and that the attempted service was null and void. This petition was unavailing. Hence this appeal.
On June 14, 1932, fourteen days before the service herein attacked, Lee, Higginson Co. had made the following announcement: "The firm plans to discontinue the issuance and distribution of securities and will, with certain exceptions, withdraw from the deposit business. A corporation to be known as Lee Higginson Corporation, with its capital paid in from sources outside the present partnership, is presently to be formed to engage in the securities business with offices in New York, Boston and Chicago. The assets of Lee, Higginson Company will remain with the partnership, and following the formation of the new corporation the firm will devote itself to the protection and eventual liquidation of its assets and to the handling of its existing acceptance business." The firm claimed that on June 15, 1932, it closed all of its offices, its purpose being to withdraw from the securities business, except the offices in New York, Boston and Chicago, *485 which were kept open for the purpose of completing pending transactions and protecting assets. It was testified by one of the partners that the managers of the branch offices, including the one in Pittsburgh, were notified, on or before June 15, 1932, that the firm had determined to withdraw from business and instructed them to close the branch offices on June 15, 1932, and to notify the other employees that their employment with the firm terminated on that date. The rent for the office in Pittsburgh was paid until August 29, 1932, when the firm secured the cancellation of its lease. The Pittsburgh manager was paid a salary to June 15, 1932, and then he and the other employees were paid additional amounts equivalent to another one-half month's salary. This was characterized by defendants' witnesses as "extra compensation for lack of preliminary notice of the termination of employment." During the latter part of June, 1932, and the early part of July, 1932, the manager sold furniture which was in the firm's office in Pittsburgh and forwarded to the firm's New York office the checks received therefor.
The court found from the evidence that the office was kept open in Pittsburgh until July 1, 1932, with the names of the defendants on its doors, that the telephone in the defendants' name was not disconnected until July 1, 1932, and that this service from June 15th to July 1, 1932, was paid for by defendants. The court also found that Gilliland not only sold the office furniture for the defendants and remitted the proceeds, after June 15, 1932, but he also collected the licenses of defendants' agents in Pittsburgh and forwarded them to defendants, that he closed two bank accounts of defendants and transmitted the amount to them, and that he shipped to defendants files and records after June 15, 1932, and arranged for the cancellation of the telephone contract as of July 1, 1932. The court also found from the evidence that "to all outward appearances defendants were doing business in Allegheny County on June 28, 1932, as they *486 had been for years theretofore, and Gilliland was in outward possession of their office as their agent and representative."
The appellants argue that, though subsequent to June 15, 1932, Gilliland sold the office furniture, sent the firm's records to New York, etc., that the firm's name remained on the door of the office, and that the telephone service was not disconnected until July 1, 1932, "that sort of thing was not, we submit, being 'engaged in business' but was merely disposing of equipment and closing the office after the defendants had ceased to be 'engaged in business' in Allegheny County as investment bankers or otherwise." It is true that the firm was not engaged in exactly the same sort of business after June 15, 1932, as it had been theretofore, but the evidence amply sustained the finding that the firm was "engaged in business" at the time service was made, i. e., June 28, 1932.
Appellants next contend that "registration under the Fictitious Names Act of June 28, 1917, does not operate as a power of attorney [for Gilliland] for substituted service." Appellants say "that the Fictitious Names Act does not have any reference to service of process and is irrelevant to the issues of this appeal," and "registration under it gives nobody a power of attorney," and that "it is not directed at nonresidents, but at all persons who do business under fictitious names; . . . . . . No provisions of the statute pertain to service of process on either residents or nonresidents."
That this act makes specific reference to nonresident owners in this State is indicated in the second paragraph of section 1 of the act, which reads as follows: "Where any of the owners of said business live outside of the Commonwealth ofPennsylvania [italics supplied], and carry on or conduct any such business through an agent, such certificate shall also show the name and address of such agent." The section quoted was amended by the Act of May 10, 1921, P. L. 465, by adding after the words "such agent," "Provided, That the failure of any such *487 person or persons [i. e., nonresident owners] to file the certificates aforesaid . . . . . . shall not impair or affect the validity of any contract with such person or persons, and actions or proceedings at law or in equity may be instituted and maintained on any such contract, but no such action shall be instituted or recovery had by any such person or persons on any such contract, either expressed or implied, in any of the courts of this Commonwealth . . . . . . until such person or persons comply with the provisions of this act." This was a denial of access to the courts of this Commonwealth by any absentee owners of local businesses until they had, inter alia, designated their agent in this Commonwealth and set forth his address.
In Lamb v. Condon et al.,
Without question or protest these defendants duly designated a certain person as their agent in this Commonwealth. The American Law Institute in "Restatement of the Law of Agency," volume 1, section 1, page 7, lays down the following definitions of Agency: "(1) Agency is the relationship which results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act. (2) The one for whom action is to be taken is the principal. (3) The one who is to act is the agent."2 The term agent is customarily *488 defined as one who has been entrusted with the business of another. Gilliland was the person these defendants said "shall act on their behalf and subject to their control," in Allegheny County, in matters relating to the principals' business. He therefore answers the description of an "agent" upon whom, under the Acts of 1856 and 1858, supra, service was properly had in the suit against these nonresident principals. As their duly selected agent, he was presumably vigilant in guarding their interests, and, being so, would notify the defendants of the summons served upon him. This in fact he did.
The "agent" on whom service may be made effectually does not have to be described as "an attorney in fact," or as a "special agent," or as "an agent on whom process may be served," nor does any of his "authority" have to be expressed. It is sufficient for a valid service under the Acts of 1856 and 1858, supra, that he has the name or character of "agent," in the appropriate territory, of the defendants against whom the writ has been directed. Appellants say it is "doubtful whether they were required to register under the Fictitious Names Act" and that this act has nothing to do with substituted service. The answer to that is that Gilliland would be equally subject to service of this writ, as defendants' agent, even if there had been no designation of him as such under the Fictitious Names Act or if there had been no such act. He was their agent infact when he was served on June 28, 1932. His being registered as such merely facilitates the proof.
The record discloses therefore that appellants, Lee, Higginson Co., were "doing business" in Allegheny County on the day the summons was served on Gilliland, that they themselves were nonresidents, and Gilliland was at that time their duly designated agent in that territory, *489 and that under the laws of this Commonwealth an effective service was made upon them, by serving the writ upon him. The return of service shows that the requirements of our nonresident-service acts were fully satisfied.
The practice of serving, in various actions and under specified circumstances, a summons on a person who is designated by the principal as his agent has long been established by statute3 in this Commonwealth and not the slightest judicial currency has ever been given to the idea — if such has even been advanced — that a judgment against a defendant so summoned to appear and defend was a deprivation of his property otherwise than by *490 "the law of the land" as that equivalent4 of "due process of law" is used in article I, section 9, of Pennsylvania's Bill of Rights.
The next question is: Did the service of this process on these nonresident defendants by serving their designated agent deprive them of that "due process of law" guaranteed by the Fourteenth Amendment to the United States Constitution as the United States Supreme Court has interpreted that phrase? Appellants contend that it does. Their proposition is that the service was "not good" even if defendants had continued to do business in Allegheny County and Gilliland had continued in their employ to and including the date of service. They argue: "The defendants were nonresidents of the Commonwealth. They were not served with process. A nonresident absent individual does not become amenable to a court in Pennsylvania in an action in personam without service upon him even if he does do business in Pennsylvania through his agents or employees. Our legislature is without constitutional power to enact a statute purporting to place nonresident individuals under the jurisdiction of our courts when such individuals are not served and are geographically beyond the reach of process. Assent to a statutory substituted or constructive service intended to create jurisdiction in personam, when in fact such jurisdiction does not exist, cannot be made a condition of doing business within the State. Nonresident individuals, unlike foreign corporations, are citizens and as such have an absolute right to do business in a lawful manner in every state, and submission to suit in personam without any effectual service of process cannot be compelled by statute." *491
If appellants mean to invoke "an absolute right to do business" in every state, the answer is that they are invoking something which in the practical affairs of government is nonexistent. All constitutional and statutory rights must be exercised with due regard for the regulations of the sovereign of the place of exercise. Even the so-called "fundamental right" to life, liberty and the pursuit of happiness is not absolute but relative. If appellants mean simply to invoke the right of citizens of other states to do business in this Commonwealth "in a lawful manner," the answer is that that right is unchallenged on this record, but the point is made that they were doing business in this Commonwealth "in a lawful manner" only when they complied with the Fictitious Names Act of 1917 by designating an agent and by here submitting through this agent to the service of judicial process as the laws of this Commonwealth prescribe. We hold that none of these statutes infringe upon the due process clause of the federal Constitution.
"The citizens of each state shall be entitled to all privileges and immunities of citizens in the several states," as section 2 of article IV, of the Constitution declares. This has been interpreted as the right "to pass through, or to reside in any other state for purposes of trade, agriculture, professional pursuits or otherwise."5 See Ward v. Maryland, 12 Wall. 418, at 430, and Paul v. Virginia, 8 Wall. 168, 180. But this right is no more nearly "absolute" than any other rights guaranteed citizens by the federal Constitution and there are numerous examples of state regulation of federal rights, which regulations have been upheld by the United States Supreme Court. For example, a state cannot lawfully exclude from its domain a corporation which is engaged solely in interstate commerce. But this powerlessness to exclude, does not mean powerlessness to impose fair and reasonable conditions *492
of admission. The United States Supreme Court, in International Harvester Co. v. Kentucky,
In Chicago, Rock Island and Pacific Ry. Co. v. State of Arkansas,
In Continental Baking Co. et al. v. Woodring, Governor, et al.,
In Hendrick v. State of Maryland,
A state has no more power to exclude arbitrarily from its domain individual citizens who wish to journey therein or to do business there than it has to exclude corporations engaged solely in interstate commerce. Yet it has been held that though a state cannot exclude citizens of other states, it may, without infringing upon the federal Constitution, impose conditions upon admission. That individual citizens of one state who use the highways of another may be compelled by the laws of that other state to "appoint," by their very use of those highways, an official *494
of the visited state as their agent or attorney, upon whom process may be served with the same force and effect as though served on them personally, provided actual notice of such service has been received by such citizens, has been expressly decided. In Hess v. Pawloski,
In Kane v. State of New Jersey,
It may be urged that a statutory requirement that visiting motorists automatically designate a state official as their attorney upon whom process may be served is distinguishable from the situation now before us in that it is merely the exercise of the state's police power in the interest of the safety of its citizens. The answer to that is that such requirements are not in their essence "police regulations" butprocedural regulations. A state protects its citizens from reckless motorists primarily by penal laws, making the negligent operation of motor vehicles a crime. Penal laws serve the public safety better than civil procedures or regulations, for, in criminal prosecutions growing out of fatal or nonfatal injuries to its inhabitants, the defense of contributory negligence is not available, whereas, in civil suits for damages caused by negligent operation of motor vehicles, contributory negligence is a defense. Laws like the Massachusetts statute and New Jersey statute which were reviewed in the last two cases cited, are designed by the states enacting them to enable their injured citizens to maintain actions in their own courts against citizens of other states who, by negligent operation of motor vehicles, inflicted injuries upon them.
Even if we regard such acts, however, exclusively as police regulations, that view of them would not give them a constitutionally preferred status over the Pennsylvania acts now being reviewed. The United States Supreme Court in Sligh v. Kirkwood, Sheriff of Orange County, Florida,
The essence of appellants' complaint is that they have been denied due process of law. This is based, of course, not on any departure from "due process" in the course of a trial, for as yet there has been no trial; it must be based on departure from "due process" in giving notice to appear and defend. In Holden v. Hardy,
In Washington v. Superior Ct.,
Appellants quote from Pennoyer v. Neff,
Appellants rely on the case of Flexner v. Farson et al.,
Our affirmation of the judgment of the court below is based upon the fact indicated by the evidence and found by the court that "the cause of action arose out of a transaction of their [i. e., defendants'] business in Allegheny County." This decision is without prejudice to the defendants to renew their atack on the service should later proceedings show that the cause of action did not so arise.
Our conclusions are:
First, that the statutes attacked do not abridge the privileges or immunities of citizens of the United States. A citizen of another state has no cause to complain when Pennsylvania imposes the conditions it has imposed on his doing business here, and which are precisely like those imposed on its own citizens. If a resident of another part of Pennsylvania maintained an office and agent in Allegheny County, he could be sued in that county in actions in personam and he would have to respond to the process served on his agent, and defend a suit in that county though it might be hundreds of miles from his place of residence. A nonresident of Allegheny County who happens to reside, for example, in New York State has no more cause to complain of this statute than has a nonresident of Allegheny County who may reside in eastern Pennsylvania only a short distance from the New York State line.
Secondly, that appellants' claim of denial of due process of law is not well founded. In Simon v. Craft, *501
If, as in Hess v. Pawloski, supra (
The judgment is affirmed.
The Act of 1858, P. L. 403, section 1, provides as follows: "When any person or persons, not being residents of the Commonwealth, shall engage in business in any county of this Commonwealth, it shall and may be lawful for the officer charged with the execution of any writ or process issued out of any of the courts of this Commonwealth, to serve the same upon any clerk or agent of such person or persons, at the usual place of business or residence of such agent or clerk, with like effect as though such writ or process was served personally upon the principal."