A. Booth & Co. v. Weigand

• Decision Date: 03 January 1906
• Docket Number: 1640
• Parties: A. BOOTH & CO. v. WEIGAND. [*]
• Court: Utah Supreme Court

83 P. 734

30 Utah 135

A. BOOTH & CO. v. WEIGAND. ^[*]

No. 1640

Supreme Court of Utah

January 3, 1906

On rehearing. Former decision annulled.

For former opinion, see 79 P. 570, 28 Utah 372.

Judgment affirmed.

W. R Hutchinson for appellant.

S. P Armstrong for respondent.

STRAUP J. McCARTY, J., concurs. BARTCH, C. J., dissenting.

OPINION

STRAUP, J.

1. The respondent, plaintiff below, is a corporation organized under the laws of the state of Illinois. It brought an action against appellant, defendant below, on three counts or causes of action--the first for goods sold and delivered by it to the appellant; the second and third on assigned claims for goods sold and delivered to appellant by the Cudahy Packing Company, a corporation, and by E. G. Hines, doing business as Hines Mercantile & Commission Company. The defendant answered, alleging that the plaintiff had not legal capacity to sue on any of the causes of action, on the ground that it was a foreign corporation and had not complied with the laws of this state permitting foreign corporations to do business within its borders, and that it was conducting at Salt Lake City a general mercantile business of buying and selling at retail fish, game, and poultry, and there maintained an office and principal place of business. As a further defense to the first cause of action it was alleged that the goods were sold and delivered whilst it was engaged in such business. As a further defense to the second and third causes it was alleged that at the time of the assignments by the Cudahy Packing Company and by Hines of their claims to plaintiff it was, unlawfully and in violation of the statutory and constitutional provisions of the state permitting foreign corporations to do business, engaged in said fish, game, and poultry business; but it was not alleged that the claims or the assignments thereof were in any manner connected with said business, or in anywise grew out of the same, or were at all related thereto; nor was it alleged that the business conducted by the said assignors was in any particular unlawful or wrongful, or that either of the assignors had violated any provision of law. The lawful status of the assignors and of their business is unquestioned. Plaintiff's demurrer to this answer being sustained, and the defendant declining to further answer, judgment was entered for plaintiff.

The defendant appealed therefrom, and at the October term, 1904, this court decided that none of the said contracts could be enforced in the courts of this state by the plaintiff because of its noncompliance with the following constitutional and statutory provisions: Article 12, section 9:

"No corporation shall do business in this state, without having one or more places of business, with an authorized agent, or agents, upon whom process may be served; nor without first filing a certified copy of its articles of incorporation with the secretary of state."

Section 351, Revised Statutes 1898:

"All corporations, not organized under the laws of this state, before doing business within the state, shall file with the Secretary of State," etc., "a certified copy of their articles of agreement, a certificate of incorporation, and by-laws, etc., and shall also, before doing business within the state, by resolution, etc., accept the provisions of the Constitution of this state, and designate some person residing in the county in which its principal place of business in the state is situated upon whom process, etc., may be served."

Section 352, Rev. St. 1898:

"Any such corporation failing to comply with the provisions of the foregoing section shall not be entitled to the benefits of the laws of this state relating to corporations; and any person acting as agent of a foreign corporation which shall neglect or refuse to comply with the foregoing provisions, shall be deemed guilty of a misdemeanor and shall be personally liable on any and all contracts made in this state by him for and in behalf of such company during the time that it shall remain so in default," etc.

The following constitutional provisions were also referred to: Article 12, section 1:

"All corporations doing business in this state, may, as to such business, be regulated, limited or restrained by law."

Section 4:

"All corporations shall have the right to sue, and shall be subject to be sued, in all courts, in like cases as natural persons."

The case is reported in 28 Utah 372, 79 P. 570.

A petition for rehearing having been granted, the matter is again before us for review. We are persuaded that the former decision is erroneous, and is against the weight of authority, especially as to the second and third causes.

2. It is well first to notice the principal cases cited in support of the former decision:

Paul v. Virginia, 8 Wall. 168, 19 L.Ed. 357, is cited and quoted from. In that case, Paul, a resident of Virginia, and an agent of a New York Insurance company, was convicted in the state court for engaging in the insurance business without a deposit bond as required by the statute. He appealed to the Supreme Court of the United States, attacking the validity of the statute, and denying the power of the state to pass such a law.

The case of Pembina Min. Co. v. Pennsylvania, 125 U.S. 181, 8 S.Ct. 737, 31 L.Ed. 650, cited, was one where a mining company, a corporation under the laws of Colorado, and there having its principal office, was assessed a tax for "office license" in the state of Pennsylvania. The validity of the act authorizing the state to make such assessment was assailed and claimed to be unconstitutional. It is readily perceived that these cases presented altogether different questions from the one here under consideration. Inasmuch as the right of the state to impose conditions upon which foreign corporations may do business within its borders is conceded in this case, and the validity of neither the constitutional nor statutory provisions is questioned, these cases are of no importance in the determination of the real question before us, which is, as to the second and third causes: Does our Constitution or statute in effect declare that a contract is void, or non-enforceable by a foreign noncomplying corporation, when made by it within the state and when relating to single or isolated transactions, and, as to the first cause, is such a contract void or nonenforceable by it, when relating to and growing out of general business transacted by it within the state?

Barse Live Stock Co. v. Range Valley Cattle Co., 16 Utah 59, 50 P. 630, cited, is a case where plaintiff, a foreign corporation, brought an action against appellants to compel them to transfer to it on the books certain stock claimed to have been assigned, and to recover dividends that had been paid thereon. Its right to maintain the action was questioned because of its non-compliance with the enabling statute, but the claim was held untenable. Confined to the actual point decided and before the court, the decision is an authority here for the respondent on the second and third causes, and is not an authority against it on the first, because the question involved was not before the court.

In the case of Railroad v. Telluride Power Co., 23 Utah 22 63 P. 995, cited, the claim was made that the power company, a Colorado corporation, was not organized in compliance with the laws of that state, and had not conferred upon it the power to acquire and hold the subject-matter of the litigation; and the question decided was that

"A corporation of Colorado coming into this state cannot bring with it powers with which it is not endowed in Colorado. It can only have an existence under the express laws of the state where it is created, and can exercise no power which is not granted by its charter or some legislative act."

The case of Miller v. Ammon, 145 U.S. 421, 12 S.Ct. 884, 36 L.Ed. 759, cited, involved the validity of an ordinance and the right to recover for liquor sold in violation of its terms. But, as was well said in that case, "the liquor traffic is freighted with peril to the general welfare, and the necessity of careful regulation is universally conceded." There the business itself was injurious to health, and affected morals and society, and, because of those evils, it was legislated against and restricted. Here the business was not only innocent, but was in aid of the necessities of life. This distinction, well recognized in most cases, has in some not been fully observed, and may account for some of the diversity of opinion upon this question.

The case of Electric, etc., Co. v. Perry (C. C.), 75 F. 898, cited, is somewhat similar, for there the corporation brought an action against the chief of police and constables to restrain them from interfering with its business of pool selling in violation of law.

The case of Crefeld Mills v. Goddard (C. C.), 69 F. 141, cited, was upon a statute which expressly provided that any foreign corporation doing business in the state (New York) without complying with the statute "shall maintain no action in this state upon any contract made by it in this state." The difference between that statute and ours is readily perceived. Whenever the statute has expressly declared that the contract is unenforceable, that, of course, is the end of the controversy. Such a statute is self-construing, and the court has no other duty than to give it effect.

The case of Cooper Mfg. Co. v. Ferguson, 113 U.S. 727, 5 S.Ct. 739, 28 L.Ed. 1137, cited, is an authority for the respondent so far as it goes. There, the noncomplying foreign corporation made a contract in the state of Colorado and there brought an action upon the contract. Upon the questions being raised that the corporation had not the...