Anderson v. Chase Sec. Corp.

• Decision Date: 08 February 1935
• Docket Number: No. 30202.,30202.
• Parties: ANDERSON v. CHASE SECURITIES CORPORATION.
• Court: Minnesota Supreme Court

193 Minn. 443
258 N.W. 743

ANDERSON
v.
CHASE SECURITIES CORPORATION.

No. 30202.

Supreme Court of Minnesota.

Feb. 8, 1935.

Appeal from District Court, Hennepin County; A. W. Selover, Judge.

Action by Elwyn A. Anderson against the Chase Securities Corporation. From an order denying a motion to set aside the service of summons and complaint, defendant appeals.

Reversed.

Syllabus by the Court.

The license provided for in Mason's Minn. St. 1927, §§ 7493, 7494, is not the license prescribed by section 3996-11, and where a cause of action arises against a foreign corporation while it was licensed to do a brokerage business under section 3996-11 and had appointed the chairman of the securities commission its agent to receive service, it could not be served with process under section 7494 where its license to transact business as a foreign corporation was not granted until after the cause arose.

Stinchfield, Mackall, Crounse, McNally & Moore and John M. Palmer, all of Minneapolis, for appellant.

Leonard, Street & Deinard and Hyman Edelman, all of Minneapolis, for respondent.

LORING, Justice.

In an action for damages for fraud in the sale of a gold debenture of the General Theatres Equipment, Inc., the defendant, appearing specially, moved to set aside the service of the summons and complaint which had been made upon the secretary of state under the provisions of Mason's Minn. St. 1927, § 7494. Defendant has appealed from the order denying its motion.

At the time this transaction arose the defendant and eleven of its salesmen were operating under brokers' licenses, issued by the securities division of the department of commerce. The defendant, a New York corporation, at that time had not complied with the requirements of Mason's Minn. St. 1927, § 7494. It maintained an office in the city of Minneapolis from which it solicited the purchase of securities for which it took orders. These orders were sent to the Chicago office for approval, and upon remittance by the purchaser to that office such securities were mailed directly to the purchaser. In some cases purchases of securities were made subject to the approval of the Chicago office. It was while the defendant was so conducting its business that the plaintiff made the purchase complained of. Approximately a month after this transaction was closed the defendnt was licensed as a foreign corporation to engage in business in this state under sections 7493, 7494. This license was issued the 5th day of June, 1930, and June 30...