Atlas Elevator Co. v. Presiding Judge of Circuit Court of First Circuit

• Decision Date: 24 March 1966
• Docket Number: No. 4492,4492
• Parties: . Supreme Court of Hawai'i
• Court: Hawaii Supreme Court

Page 645

412 P.2d 645

49 Haw. 129

ATLAS ELEVATOR CO. v. PRESIDING JUDGE OF the CIRCUIT COURT OF the FIRST CIRCUIT Amy Chitae Segawa, Administratrix of the Estate of George Teruo Segawa, Deceased, Amy Chitae Segawa, Individually Keith Tsutomu Segawa, and Valerie Chiemi Segawa, Infants by Their Next Friend, and the City and County of Honolulu.

No. 4492.

Supreme Court of Hawai'i.

March 24, 1966.

Syllabus by the Court

1. A foreign corporation which is not required to designate an agent for service of process cannot be served by filing the process with the Director of Regulatory Agencies under R.L.H.1955, § 172-150.

2. Act 315, S.L.1957, by repealing R.L.H.1955, § 174-2, left a hiatus in the provisions for service of process should a foreign corporation carrying on interstate commerce in Hawaii thereafter absent itself leaving no officer or managing agent here, and it was not until the enactment of S.L.1965, c. 134, that the legislature added to the armory of the State a 'long-arm' statute.

3. If the installation of machinery in the State by a foreign corporation bears a relevant or appropriate relation to the contract made by the corporation outside the State for the sale of the machinery, the transaction does not lose its interstate character by reason of the installation.

4. When a defendant adduces sufficient evidence to put in issue the question of jurisdiction over the person, the burden of establishing jurisdiction shifts to the plaintiff.

5. When a writ of prohibition is sought on the ground that the lower court has wrongly decided the question of jurisdiction over the person of the petitioner, a motion to supplement the record, made by the respondent in the court hearing the prohibition case, will be treated as an offer of proof as to further evidence that could be adduced in the trial court in support of jurisdiction.

6. When, in a prohibition case, it appears that the lower court has wrongly decided the question of jurisdiction over the person of the petitioner due to an incorrect interpretation of the relevant statutes, that the court below did not address itself to the factual questions which, on a correct interpretation of the statutes, are presented, and that respondent has not sustained the burden of proof as to those factual questions but further evidence is available, the court will issue a writ restraining further prosecution of the action against petitioner on the basis of the erroneous decision of the lower court but not preventing reaffirmation of jurisdiction in the event proper evidence is adduced which calls for that result.

7. When a court hearing a prohibition case arrives at the conclusion that the issue in the case is the narrow one of the validity of the service of summons and finds the service invalid but expresses no opinion as to the possibility of effecting service by other means, a writ in the form prayed for forever restraining the further prosecution of respondent's action with respect to petitioner is not appropriate, and the writ will not restrain the taking of such steps as respondent may see fit in an endeavor to effect service by other means.

Willson C. Moore, Jr., Honolulu (Harold W. Nickelsen, Honolulu, and Leo J. Walcom, San Francisco, Cal., on the briefs; Henshaw, Conroy & Hamilton, Honolulu, and Walcom & Harmon, San Francisco, Cal., of counsel), for petitioner.

A. Singleton Cagle, Honolulu (Smith, Wild, Beebe & Cades, Honolulu, of counsel), for respondents other than C & C of Honolulu.

William Yim, Deputy Corporation Counsel, Honolulu, was present but did not agree.

Before CASSIDY, Acting C. J., WIRTZ, LEWIS and MIZUHA, JJ., and Circuit Judge LEVINSON assigned by reason of vacancy.

LEWIS, Justice.

By petition for a writ of prohibition petitioner presents the question whether service of summons by filing the same with the Director of Regulatory Agencies of the State on September 16, 1964 subjected petitioner to the jurisdiction of the Circuit Court of the First Circuit in a certain action brought by respondents, who are Amy Chitae Segawa, individually and in a representative capacity and two infants, to recover damages for the death of the husband and father of said respondents as a result of injuries suffered in an elevator accident in Honolulu in September 1962. The accident allegedly was caused by negligent installation of the elevator in 1955 by petitioner, named in said suit as a defendant.

The circuit court, Honorable Frank A. McKinley, Fourth Judge presiding, ruled that it had jurisdiction and denied petitioner's motion to dismiss. This petition followed. After the prohibition case had been argued in this court and while it was under advisement Judge McKinley left the bench. We deem the alternative writ, issued herein upon the filing of the petition, equally applicable to any judge who may preside over the case in the circuit court, and proceed to the question whether a permanent writ should issue.

Petitioner is a California corporation which has not qualified to do business in this State. As defendant below, it moved to dismiss the circuit court action and to quash service of summons, relying inter alia upon R.L.H.1955, § 174-7.5 (Supp.1963), added by S.L.1957, c. 315, which provides in paragraph (i) that 'transacting any business in interstate commerce' shall not by reason thereof be considered to be 'doing or carrying on business in the (State) for the purposes of this chapter (chapter 174, R.L.H.1955)'; and upon sections 174-1 and 174-2 of chapter 174 as they read in 1955. In 1957, as we shall have occasion to note, section 174-2 was repealed and section 174-1 was amended.

The significance of petitioner's reliance on these sections of chapter 174 lies in the provisions of R.L.H.1955, § 172-150. The authorization for service upon the Director of Regulatory Agencies must be found in this section. As amended by S.L.1963, c. 193, it read in pertinent part as follows:

' § 172-150. Manner of Service.

'If no officer, director, manager, superintendent or other person in charge of the property, business or office of the corporation can be found within the State; and in case the corporation, if a foreign corporation, has neglected to file with the officer specified in section 174-1 ¹ * * * the name of a person upon whom legal notice and process from the courts of the State may be served; and likewise in the event that the person so named is not found within the State, service may be made upon the corporation by filing with the (director of regulatory agencies), or in his absence, with the (deputy director), a copy of the notice, or process, certified to be such under the seal of any court of record * * *. The (director or deputy director) so served shall immediately notify the defendant corporation of such service. The filing shall be deemed service upon the corporation forty-five days after the filing * * *.'

Section 174-1, referred to in this statute, as amended by S.L.1957, c. 315, supra, requires the qualification of a foreign corporation which undertakes to 'do or carry on business in the State,' including as one of the requirements for qualification the designation of an agent for service of process. When sections 172-150 and 174-1 are read together, it appears that a foreign corporation which is not within the scope of section 174-1, and is not required to designate an agent for service of process, cannot be served by filing the process with the Director of Regulatory Agencies. Only a foreign corporation within the ambit of section 174-1 can be said to have 'neglected to file with the officer specified in section 174-1.' And such neglect, or unavailability of the corporation's designated agent, is by the terms of section 172-150 a condition precedent to authority to serve the Director of Regulatory Agencies.

While this interpretation is disputed by the Segawa respondents, plaintiffs in the court below, we deem it the only possible interpretation. We are not at liberty to rewrite section 172-150 by interpolating the words italicized below so as to cause it to say: '* * * and in case the corporation, if a foreign corporation, has neglected to file * * * or is not required to do so.' If the legislature had intended to provide for a means of serving every foreign corporation it would have said so. But to have said that would have rendered the statute too broad; the statute would have been without constitutional guideposts. Cf., Cella Comm'n Co. v. Bohlinger, 147 F. 419 (8th Cir.). Section 172-150 is not of such breadth. It is easily recognized as a common type of statute, which at least until a new trend was instituted by International Shoe Co. v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95, was founded on the express or implied consent of a foreign corporation to be served when it designated an agent for the purpose or was required to and failed to do so. Cf., Wilson v. Seligman, 144 U.S. 41, 45, 12 S.Ct. 541, 36 L.Ed. 338; Old Wayne Mut. Life Ass'n of Indianapolis, Ind. v. McDonough, 204 U.S. 8, 21-22, 27 S.Ct 236, 51 L.Ed. 345; Simon v. Southern Ry., 236 U.S. 115, 130, 35 S.Ct. 255, 59 L.Ed. 492; American Ry. Express Co. v. F. S. Royster Guano Co., 273 U.S. 274, 280, 47 S.Ct. 355, 71 L.Ed. 642; State of Washington ex rel. Bond & Goodwin & Tucker, Inc. v. Superior Court, 289 U.S. 361, 53 S.Ct. 624, 77 L.Ed. 1256. This statute might have served respondents' purpose without resolution of the factual issues encountered here, had not Act 315, S.L.1957, narrowed the requirements as to designation of an agent, repealing section 174-2 which in turn caused the reference to section 174-2 to be deleted from section 172-150 as set out in note 1, supra. This is discussed further in connection with the legislative history of chapter 174, infra.

By S.L.1965, c. 134, the legislature added to the armory of the State a statute providing for service of process on persons without the State, individuals as well as corporations,...