Ludwig v. Western Union Telegraph Company

Decision Date21 February 1910
Docket NumberNo. 45,45
Citation30 S.Ct. 280,216 U.S. 146,54 L.Ed. 423
PartiesO. C. LUDWIG, Secretary of State of Arkansas, Appt., v. WESTERN UNION TELEGRAPH COMPANY
CourtU.S. Supreme Court

Messrs. Hal. L. Norwood, William F. Kirby, Joseph M. Hill, and Otis T. Wingo for appellant.

[Argument of Counsel from pages 146-149 intentionally omitted] Messrs. Rush Taggart, George B. Rose, and Henry D. Estabrook for appellee.

[Argument of Counsel from pages 149-151 intentionally omitted] Mr. Justice Harlan delivered the opinion or the court:

The Western Union Telegraph Company, a corporation of New York, doing business, both interstate and intrastate, in Arkansas, as it had done for many years, brought this suit against O. C. Ludwig, secretary of state of Arkansas, for the purpose of obtaining a decree that the statute of that state of May 13th, 1907, entitled, 'An Act to Permit Foreign Corpora- tions to Do business in Arkansas, and Fixing Fees to Be Paid by All Corporation,' Acts of Ark. 1907, p. 744, was unconstitutional, null, and void, and enjoining the defendant, in his official capacity, from attempting to revoke, or proclaiming through official newspaper publications that he had revoked, the authority of the plaintiff to do business in Arkansas, or that it had no right to continue doing business in that state. The plaintiff, in its bill, asked such other and further relief as the case might require and as might seem just.

A temporary injunction was issued, and thereafter the defendant demurred and answered at the same time. The demurrer was on these grounds: That the court was without jurisdiction to hear and determine the case, 'the same being, in effect, a suit against the state' by a citizen of another state, to prevent the enforcement of one of its criminal or penal statutes; that the facts stated in the bill are not sufficient to constitute a cause of action nor to warrant the relief asked; and that the bill was wholly without equity. The answer denied all the material allegations of the bill.

Subsequently, the plaintiff, by leave of the court, filed an amendment of its bill. To that amendment no answer was made, but, all parties being present, the cause was heard, without objection, on the demurrer to the bill. The demurrer was overruled, and the defendant having elected not to plead further, the injunction previously granted was made perpetual. From that order the present appeal was prosecuted.

The above statute, known as the Wingo act, whose constitutionality is questioned by the plaintiff, is as follows (the italics being ours):

'§ 1. Every company or corporation incorporated under the laws of any other state, territory, or country, including foreign railroad and foreign fire and life insurance companies, now or hereafter doing business in this state, shall file in the office of the secretary of state in this state a copy of its charter or articles of incorporation or association, or a copy of its certificate of incorporation, duly authenticated and certified by the proper authority, together with a statement of its assets and liabilities and the amount of its capital employed in this state, and shall also designate its general office or place of business in this state, and shall name an agent upon whom process may be served. Provided, before authority is granted to any foreign corporation to do business in this state, it must file with the secretary of state a resolution adopted by its board of directors, consenting that service of process upon any agent of such company in this state, or upon the secretary of state of this state, in any action brought or pending in this state, shall be a valid service upon said company; and, if process is served upon the secretary of state, it shall be his duty to at once send it by mail, addressed to the company at its principal office; and if any company shall, without the consent of the other party to any suit or proceeding brought by or against it in any court of this state, remove said suit or proceeding to any Federal court, or shall institute any suit or proceeding against any citizen of this state in any Federal court, it shall be the duty of the secretary of state to forthwith revoke all authority to such company and its agents to do business in this state, and to publish such revocation in some newspaper of general circulation published in this state; and if such corporation shall thereafter continue to do business in this state, it shall be subject to the penalty of this act for each day it shall continue to do business in this state after such revocation.

'§ 2. Any foreign corporation which shall fail to comply with the provisions of this act, and shall do any business in this state, shall be subject to a fine of not less than $1,000, to be recovered before any court of competent jurisdiction, and all such fines so recovered shall be paid into the general revenue fund of the county in which the cause of action shall accrue; and it is hereby made the duty of the prosecuting attorneys to institute said suits in the name of the state, for the use and benefit of the county in which the suit is brought, and such prosecuting attorney shall receive as his compensation one fourth of the amount recovered, and as an additional penalty, any foreign corporation which shall fail or refuse to file its articles of incorporation or certificate as aforesaid, cannot make any contract in this state which can be enforced by it either in law or in equity; and the complying with the provisions of this act after suit is instituted shall in no way validate said contract.

'3. That all corporations hereafter incorporated in this state, and all foreign corporations seeking to do business in this state, shall pay into the treasury of this state for the filing of said articles a fee of $25 where the capital stock is $50,000 or under; $75 where the capital stock is over $50,000, and not more than $100,000; and $25 additional for each $100,000 of capital stock.

'Any foreign mutual corporation having no capital stock shall be required to pay to the secretary of state for filing its articles of incorporation the sum of $500. Provided, however, nothing in this section shall apply to fraternal orders that write insurance.

'§ 4. That act 185, approved April 17, 1907, and entitled, 'An Act to Provide a Manner in Which Foreign Corporations May Become Domestic Corporations, and for Other Purposes,' and all laws and parts of laws in conflict herewith, be and the same are hereby repealed; and that this act take effect and be in force from and after its passage.' Acts of Ark. 1907, p. 744.

As the case was decided on demurrer to the bill, the material facts properly alleged are to be taken as true on this hearing. The case made by the plaintiff in its bill is substantially as will be now outlined.

The telegraph company was organized in 1851, and immediately thereafter began the work of constructing and operating telegraph lines. Its system extended throughout the United States and Canada, and connected with lines in Mexico and Central and South America by means of submarine cables, and with telegraph systems of foreign countries.

Among the lines so constructed, and forming a component part of the company's system, and connecting with its main office in New York, are lines within Arkansas, most of which were constructed since 1867, in which year the company accepted the terms and conditions of the act of Congress of July 24th, 1866, entitled, 'An Act to Aid in the Construction of Telegraph Lines, and to Secure to the Government the Use of the Same for Postal, Military, and Other Purposes.' 14 Stat. at L. 221, chap. 230, Rev. Stat. §§ 5263 to 5269, inclusive, U. S. Comp. Stat. 1901, pp. 3579 to 3582.

It should be stated in this connection that the bill alleges that the company's lines within Arkansas are upon the public domain and upon the military and post roads of the United States, are part of the postal routes and postal establishment of the United States, and, as such, the complainant has, under the Constitution and laws of the United States, the power, and is under obligation, to transmit all messages for the government and for the public generally as much and as fully with respect to messages between points within the said state as interstate messages. The company's lines within Arkansas were constructed with the consent and permission of the state, certainly without objection on its part, and in accordance with its laws. The amount which the company, up to the bringing of this suit, had invested in lines within Arkansas, was $153,000, and continuously since their construction the telegraph company has used them 'for the transmission of telegraph messages for the government of the United States, and the several departments thereof, and for the public, as an instrumentality of the Postal Department and of commerce wholly within the state of Arkansas, and also for interstate commerce and commerce between points in said state and foreign countries, and thus said telegraph lines have been continuously employed in domestic, interstate, and foreign commerce since their construction.'

The above act of 1907 requires that every foreign corporation doing or seeking to do business in the state should file in the office of the secretary of state a copy of its charter or articles of incorporation, duly authenticated, together with a statement of its assets and liabilities and the amount of its capital employed in the state, and designate its general office or place of business therein, and the name of an agent upon whom process in any action brought or pending in the state may be served. The company tendered to the secretary of state a duly authenticated copy of a resolution of the board of directors, assenting to the designation of an agent upon whom process against the company might be served; also, the above required statement; 'and offered to the secretary of state [who claimed...

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