Atlantic Nat. Bank of Boston v. Hupp Motor Car Corp.
| Decision Date | 16 September 1937 |
| Citation | 10 N.E.2d 131,298 Mass. 200 |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
| Parties | THE ATLANTIC NATIONAL BANK OF BOSTON v. HUPP MOTOR CAR CORPORATION & others. |
May 13, 14, 1937.
Present: RUGG, C.
J., CROSBY DONAHUE, LUMMUS, & QUA, JJ.
Jurisdiction Foreign corporation, Nonresident defendant, Objection to jurisdiction. Corporation, Foreign, Officers and agents. Agency, What constitutes. Interstate Commerce. An officer's return showing service upon a foreign corporation by service
"in hand to" a named person "its district manager, and the person in charge of its business," showed proper service upon the defendant's agent in charge of its business, and was sufficient in form under G.L.
(Ter. Ed.) c. 223 Sections 38, 37.
A foreign corporation was entitled to have its contention, raised by a plea to the jurisdiction, that at the time of alleged service of process it was not doing business here and was not present nor "found in" this
Commonwealth, examined and determined on the facts, and as to such jurisdictional matter it was not bound by statements in the officer's return.
A foreign corporation, engaged elsewhere in the manufacture and sale of motor cars, was engaged in business in this Commonwealth and subject to service of process within the meaning of G.L. (Ter. Ed.) c. 223, Section
38, by having an agent in residence here take over temporarily the activities of its independent local distributor upon his withdrawal from business and in so doing conduct transactions which partook of the character of a course of dealing here at the time of service. An agent of a foreign corporation might be found actually to have been in
"charge of its business" here and qualified to receive service of process under G.L. (Ter. Ed.) c. 223, Sections 38, 37, though at the moment of service a nonresident superior of his was here temporarily.
It was not an unreasonable burden upon interstate commerce to require a foreign corporations carrying on business temporarily in this
Commonwealth, to answer to a suit brought here by a resident and arising out of transactions which took place here.
BILL IN EQUITY, filed in the Superior Court on April 11, 1935, with a trustee writ dated April 10, 1935.
A plea in abatement was overruled by interlocutory decree entered on January 8, 1937, by order of Greenhalge, J., who reported his ruling for determination by this court.
J. T. Noonan, for the defendant Hupp Motor Car Corporation.
S. C. Rand, (M.
Jenckes with him,) for the plaintiff.
The defendant Hupp Motor Car Corporation, a foreign corporation hereinafter referred to as the defendant, pleads in abatement to the jurisdiction of the court on the grounds both that the officer's return is insufficient on its face to establish service upon the defendant and that in fact no valid service was made.
One return upon the subpoena shows service upon the defendant on December 3, 1935, "in hand to A. D. Chantler, its District manager, and the person in charge of its business." By G.L. (Ter. Ed.) c. 223, Sections 37, 38, service upon a foreign corporation which is permanently or temporarily engaged in business in this Commonwealth may be made upon its "president, treasurer, clerk, cashier, secretary, agent or other officer in charge of its business." The defendant contends that the return fails to disclose service upon either an officer or an agent "in charge of its business," citing United Drug Co. v. Cordley & Hayes, 239 Mass. 334 , and Zani v. Phandor Co. 281 Mass. 139 . Although a "District manager" may not be an officer in the ordinary sense of the word, it is difficult to see how any manager or employee of a corporation in charge of its business can be other than its agent. If there can be cases where he is not its agent they are too few in number and too peculiar in character to deprive the words used in this return of their natural signification. We think that the return, fairly construed, shows service upon the agent in charge of the defendant's business, and that it is sufficient in form.
But the defendant further insists that on December 3, 1935, it was not doing business within this Commonwealth and that it was not present or "found in" the Commonwealth and therefore that it was not in any event answerable to service or to suit here. As a nonresident it is entitled under general principles of comity as well as under the due process clause of the Federal Constitution to have this question examined and determined on the facts, and as to such a jurisdictional matter it is not bound by statements in the return, however correct in form the return may be. Bay State Wholesale Drug Co. v. Whitman, 280 Mass. 188 . Reynolds v. Missouri, Kansas & Texas Railway, 224 Mass. 379 . Thurman v. Chicago, Milwaukee & St. Paul Railway, 254 Mass. 569 . Riverside & Dan River Cotton Mills v. Menefee, 237 U.S. 189. Philadelphia & Reading Railway v. McKibbin, 243 U.S. 264, 265. Bank of America v. Whitney Central National Bank, 261 U.S. 171, 173.
The evidence is reported, and in our opinion it establishes these facts: The defendant was engaged in the manufacture and sale of motor cars with general offices in Detroit, Michigan, and several manufacturing plants, all outside this Commonwealth. Prior to November 1, 1935, the defendant had a contract with a "distributor" located in Boston under which the defendant sold cars to the distributor on the distributor's orders, accepted by the defendant, payment to be made in advance or by sight draft with bill of lading attached, and wherein it was provided that sales should be understood to be made at Detroit and that the distributor was not authorized to act as the agent of the defendant. The cars were resold in this Commonwealth by the distributor, partly at retail and partly to various local dealers selected by the distributor subject to the defendant's approval. The defendant fixed the form of contracts between the distributor and the dealers and through these contracts controlled the prices at which cars should be sold to the public and some other matters of importance to the defendant, but it did not in general operate the business either of the distributor or of the dealers. The distributor occupied a building in Boston which was owned by a corporation all of the stock of which was held by the defendant. The defendant maintained in its direct employ as its sales representative, sometimes called "District Manager," one Ackerman, whose duties in general were to travel about visiting distributors and dealers, inspecting their places of business, conferring with them as to policies and endeavoring to maintain good will and to stimulate sales. Chantler was Ackerman's assistant in New England, subject to his direction, but doing substantially the same his of work which Ackerman did. Ackerman also covered much territory outside of New England. Neither Ackerman nor Chantler sold cars.
On October 31, 1935, the Boston distributor discontinued business. This broke the connecting link between the defendant and the local dealers. As by the terms of the contracts under which they had been operating the dealers could not buy directly from the defendant, some new relationships must be established until another distributor could be found, if cars were to he sold. Thereafter the evidence shows certain activities of Ackerman and of Chantler, substantially all of which are stated or can reasonably be inferred to have taken place in Massachusetts and which arose more or less directly out of the changed conditions. On November 1 Chantler moved his residence to Massachusetts.
The defendant supplied to him and he used stationery bearing the defendant's name. He got into contact with the dealers in Massachusetts, of whom there were about fourteen, relative to having them obtain cars directly from Detroit and, together with Ackerman, transmitted their orders to Detroit. One of the first problems related to the Boston Automobile Show which was to be held during the week of November 16 to 23. It was important that the defendant's product be represented there. Ordinarily the distributor would arrange such representation, but as there was no distributor, dealers insisted that the defendant should attend to the matter. "They asked . . . [the defendant] to practically take over the exhibiting of the cars for them." The defendant shipped to Ackerman at Boston for exhibition seven cars which had already been paid for by the distributor at Bridgeport, Connecticut. Ackerman made the arrangements to get these cars. He negotiated for space at the show for which the defendant paid several hundred dollars. Chantler contracted in behalf of the defendant for the transportation of the cars from the railroad to the show, and procured a telephone, furniture, lights, signs, a porter, and service for the cars to be shown. Ackerman and Chantler attended the show from time to time and arranged with the dealers for their presence on the floor according to a schedule...
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