131 So. 52 | La. | 1930
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *376 The plaintiff has appealed from a judgment dismissing this suit on an exception to the jurisdiction of the court. The defendant is a foreign corporation, and the transaction on which the plaintiff's claim is founded was had outside of Louisiana, in the city of New York.
The defendant is incorporated under the laws of Delaware, and has its domicile in Wilmington, in that state. The plaintiff is also a Delaware corporation with its domicile in Wilmington. Both corporations were, when the transaction in question took place, and the defendant is yet, engaged extensively in the manufacture of carbon black from natural gas, in the parish of Ouachita, La., in the gas field extending into Morehouse, an adjoining parish. In fact the carrying on of such business was the object and purpose for which each corporation was organized. The principal business establishment of each corporation was in the parish of Ouachita, La., at the time of the transaction which gave rise to this lawsuit, and the principal business establishment of the defendant is there yet. *377 Each corporation had complied with the statute of Louisiana, Act No. 184 of 1924, prescribing the conditions on which a foreign corporation might do business in this state; the defendant having appointed as its agent on whom legal process should be served a resident of the city of Monroe, the parish seat of Ouachita parish, where the present suit was instituted by personal service upon the agent so appointed.
The suit is for $60,000, with legal interest thereon, and for recognition of the vendor's lien on certain property sold by the plaintiff to the defendant, consisting of 30 acres of land in Ouachita parish, La., and a number of oil and gas leases on lands in that parish, with the carbon black manufacturing plant, warehouses, residences, offices, railroad tracks and sidings, and all machinery and equipment on the lands, used in the manufacture of carbon black, gasoline and other products or by-products of oil and gas. The sale included also the pipe lines of the plaintiff, specifically, 49,797 feet of 6-inch pipe line and 51,636 feet of 4-inch pipe line, and the rights of way therefor, extending from Ouachita into Morehouse parish, La.
It appears from the deed annexed to the plaintiff's petition — and is admitted in the defendant's pleadings — that the sale was made in New York City, on the 28th of March, 1925, by deed before a notary public for New York county. It appears also in the deed that "the price and consideration" for which the sale was made was $1,241,800, paid in the capital stock of the United Carbon Company, and represented by 6,209 shares of 7 per cent. noncumulative preferred stock and 24,837 shares of fully paid and nonassessible common stock. It is alleged in the plaintiff's petition that the agreement was that half of the price should be paid in the preferred stock, at $100 per share, and half in the common stock, at $25 *378 per share; that the price was to be determined by a valuation to be made by the American Appraisal Company; that the appraisement amounted to $1,239,995.48, but that, through error, the American Appraisal Company included in its appraisement certain supplies, appraised at $1,861.58, which were not intended to be included; and that the true price was therefore $1,239,995.48, for which the buyer was to deliver 6,200 shares of the preferred stock, at $100 per share, and 24,800 shares of the common stock, at $25 per share. It is alleged that the defendant delivered only 5,900 shares of the preferred stock and only 23,600 shares of the common stock, and that, notwithstanding repeated demands on the part of the plaintiff, the defendant has failed and refused to deliver the remaining 300 shares of preferred stock, at the agreed valuation of $30,000, and 1,200 shares of the common stock, at the same valuation. The suit, therefore, is for the $60,000, alleged to be the unpaid part of the price of the property, or the value, agreed upon, of the undelivered stock.
The question of jurisdiction, which is the only question before us, depends upon the proper construction of Act No. 184 of 1924, p. 286. The statute requires that a foreign corporation shall, as a condition precedent to being authorized to do business in this state, file in the office of the secretary of state a written declaration of its domicile, of the place or places where it is to do business in this state, the place of its principal business establishment, and the name of an agent or officer in the state upon whom process may be served, who shall be a resident of the parish in which the corporation has an established business. The statute provides further that the appointment of the resident agent or officer on whom service of process may be made shall be contained in a written power of attorney, accompanied *379 by a certified copy of a resolution of the board of directors of the corporation, consenting that any lawful process against the corporation served upon the resident agent or officer named in the resolution shall be a valid service upon the corporation, "and that the authority shall continue in force and be maintained as long as any liability remains outstanding against said corporation growing out of or connected with the business done by said corporation in this state."
The United Carbon Company declared in the appointment of the resident agent, and in the resolution of the board of directors authorizing and accompanying the appointment, filed in the office of the secretary of state, previous to the transaction which brought about this suit, that the company's principal business establishment was in Ouachita parish and Morehouse parish; that the company appointed C.H. McHenry, a resident of the city of Monroe, in the parish of Ouachita, La., as its agent in Louisiana, on whom all process of law, whether mesne or final, against the company, should be served, in any action or special proceeding against the company in the state of Louisiana; that the said agent was thereby duly authorized and empowered, as the agent of the company, to receive and accept service of process in all cases provided for by the laws of Louisiana; and that such service should be deemed a valid personal service and binding upon the company, according to the Constitution of Louisiana and Act No. 184 of 1924.
The question, therefore, is whether the liability of the defendant, for the price of the property in Louisiana, bought from the plaintiff in New York, if any such liability remains unpaid, is, in the meaning of the statute (Act No. 184 of 1924, § 2), a liability "growing out of or connected with the business done by said corporation in this state." The defendant *380 pleaded specifically, in the exception to the jurisdiction of the court, that the Act No. 184 of 1924 would be violative of the Fourteenth Amendment of the Constitution of the United States, in that it would be a denial of due process of law, if construed so as to confer upon the courts of this state jurisdiction over this case.
Our opinion is that the liability of the defendant, for any unpaid part of the price of the property in Louisiana, bought by the defendant from the plaintiff in New York, if any such liability remains unpaid and if the plaintiff therefore has a cause of action anywhere, is a liability connected with the business done by the defendant in this state. The term, "the business done by said corporation in this state," does not mean the single transaction by which the liability was incurred. It means the business done generally by the corporation in this state, and by the doing of which the corporation is deemed to be in the state, under the protection of the laws of the state, and subject to the jurisdiction of the courts of the state. The liability disclosed by the pleadings and the record in this case, if there is any such liability, is for a part of the price or consideration for the transfer by the plaintiff to the defendant of property in this state, both real and personal property, to be used by the defendant corporation, and in fact used by the defendant corporation, in "the business done by said corporation in this state." It would be difficult to imagine a liability more closely connected with the business done by the corporation in this state.
We express no opinion, of course, as to whether the plaintiff can prove the liability alleged in this case. But the facts disclosed by the pleadings, and by the evidence introduced on the trial of the plea to the jurisdiction, *381 are sufficient to subject the defendant to the jurisdiction of the district court in and for the parish of Ouachita, under the provisions of Act No. 184 of 1924; and, as thus construed, the statute is not violative of the Fourteenth Amendment.
In B. O. Railroad Co. v. Harris, 79 U.S. (12 Wall.) 65, 81, 20 L. Ed. 358, in 1871, it was said of a corporation as distinguished from a person:
"It cannot migrate, but may exercise its authority in a foreign territory upon such conditions as may be prescribed by the law of the place. One of these conditions may be that it shall consent to be sued there. If it does business there it will be presumed to have assented and will be bound accordingly."
In Barrow Steamship Co. v. Kane,
"The liability of a foreign corporation to be sued in a particular jurisdiction need not be distinctly expressed in the statutes of that jurisdiction, but may be implied from a grant of authority in those statutes to carry on its business there."
In Robert Mitchell Furniture Co. v. Selden Breck Construction Co.,
"The purpose in requiring the appointment of such an agent is primarily to secure local jurisdiction in respect of business transacted within the State. Of course when a foreign corporation appoints one as required by statute it takes the risk of the construction that will be put upon the statute and the scope of the agency by the State Court. * * * As we know of no decision to the contrary by the Supreme Court of Ohio, we are of opinion that the service upon Nash was bad."
In Washington-Virginia Railway Co. v. Real Estate Trust Co.,
"We think the mere recital of these facts makes it evident that the corporation was properly served. It had submitted itself to the local jurisdiction, and there enjoyed the protection of the laws. In that jurisdiction by duly authorized agents it was, at the time of service, transacting an essential and material part of its business.
"It follows that the judgment of the District Court, maintaining its jurisdiction, must be affirmed."
In Bethlehem Motors Corporation et al. v. Flynt,
"This court has decided too often to need citation of the cases that corporation doing business in a state and having an agent there are within the jurisdiction of the state for the purpose of suit against them, and we may assume that the principle is applicable here and that the Pennsylvania corporation, the Indiana corporation and the Delaware corporation are within the jurisdiction of the state and subject to its laws, equally with the corporations of the state."
The appellee quotes and relies upon the ruling in Simon v. Southern Railway Company,
"The broader the ground of the decision here, the more likelihood there will be of affecting judgments held by persons not before the court. We therefore purposely refrain from passing upon either of the propositions decided in the courts below, and without discussing the right to sue on a transitory cause of action and serve the same on an agent voluntarily appointed by the foreign corporation, we put the decision here on the special fact, relied on in the court below, that in this case the cause of action arose within the State of Alabama, and that the suit therefor, in the Louisiana court, was served on an agent designated by a Louisiana statute."
The two outstanding facts in the present case, which were not facts in the case of Simon v. Southern Railway Co., and which distinguish this case from that, are, first, that the liability alleged in this case, if it exists, *386 arose from a transaction connected with the business done by the defendant corporation in this state, and, second, that the service of citation in this case was upon a local agent appointed by the defendant corporation in compliance with the statute.
In Missouri Pacific Railroad Co. v. Clarendon Boat Oar Co.,
The case of Missouri Pacific Railroad Co. v. Clarendon Boat Oar Co. was decided in 1922, at a time when none of the statutes which prescribed the condition on which a foreign corporation might do business in this state had expressly limited the jurisdiction *387 of the state courts over such a corporation to cases of liability growing out of or connected with the business done by the corporation in this state. The limitation first appeared in Act No. 184 of 1924, for the purpose, manifestly, of making the statute conform expressly with the interpretation which this court had given to the previous statutes on the subject, and which the Supreme Court of the United States had recognized as a fair and reasonable interpretation.
In Louisville Nashville Railroad Co. v. Chatters, and Southern Railway Co. v. Chatters,
Morris Co. v. Skandinavia Insurance Co.,
As far as the decisions of the Supreme Court of the United States go, the Fourteenth Amendment does not forbid a state to compel a foreign corporation doing business in the state to subject itself to the jurisdiction of the state courts in suits founded upon a liability connected with the business done by the corporation in the state — e.g., for the price of property in this state bought by the corporation for use in connection with its business and actually used in connection with the business done in this state — even though the transfer was made in another state.
In Gouner v. Missouri Valley Bridge Iron Co.,
Delatour and Marmouget v. Southern Railway Co., 4 La.App. 658, in which this court refused to review the judgment of the Court of Appeal, dismissing the suit for want of jurisdiction, was an action for damages for injuries to race horses, in a railroad accident occurring in South Carolina, the horses having been shipped from Bowie, Md. The suit was filed previous to the adoption of Act No. 184 of 1924, and was decided with reference to the provisions of Act No. 194 of 1912, Act No. 243 of 1912, Act No. 267 of 1914 and Act No. 179 of 1918. The reason for the ruling that the courts of this state had not jurisdiction over the case was that the cause of action arose in another state. *389
The decided cases which support our conclusion that the district court in Ouachita parish has jurisdiction over this case are State ex rel. Watkins v. North American Land Timber Co.,
The judgment appealed from is annulled, the defendant's exception to the jurisdiction is overruled, and the case is ordered remanded to the district court for further proceedings. The defendant is to pay the costs of the trial of the exception to the jurisdiction, and the costs of this appeal; all other costs to abide the final judgment to be rendered in the case.
THOMPSON, J., takes no part.