Dudley v. Collier

• Decision Date: 11 June 1889
• Citation: 87 Ala. 431,6 So. 304
• Parties: DUDLEY v. COLLIER ET AL.
• Court: Alabama Supreme Court

6 So. 304

87 Ala. 431

DUDLEY v. COLLIER ET AL.

Supreme Court of Alabama

June 11, 1889

Appeal from circuit court, Lowndes county; JOHN MOORE, Judge.

Williamson & Williams and Watts & Son, for appellant.

Roquemore, White & Long and W. R. Houghton for appellees.

SOMERVILLE J.

The suit is brought by the appellees for a stipulated compensation agreed to be paid them by the appellant, Dudley for services rendered in procuring a loan of money for his use. The court sustained a demurrer to the sixth, seventh, and ninth pleas jointly, and this ruling is assigned as error. If either of these pleas constituted a good defense, the ruling is erroneous. The sixth plea avers that "the loan and contract of borrowing were to be made with a foreign corporation, company, or association having no authority to do any business within the state of Alabama, and that an agreement to pay the borrowed money and interest thereon, and to make a mortgage upon lands in this [Lowndes] county, [Alabama,] was to be made with a foreign corporation located in Great Britain, known as the "_____, of London, England," and the said corporation had no known place of business nor authorized agent within the state of Alabama, and had never been authorized under the laws of Alabama to do business within the state of Alabama, and that the plaintiffs were in fact the agents of such corporation."

It is declared in article 14, § 4, of our present constitution that "no foreign corporation shall do any business in this state, without having, at least, one known place of business, and an authorized agent or agents therein." Const. 1875, art. 14, § 5. We have construed this to be a police regulation, "just as much," we said, "a police regulation for the protection of the property interests of the citizens of the state as the law forbidding vagrancy among its inhabitants." Telegraph Co. v. Telegraph Co., 67 Ala. 26. The general assembly passed an act, approved February 28, 1887, to give force and effect to this section of the constitution, in which it required that every foreign corporation or company, before engaging in business in this state, shall file in the office of the secretary of state an instrument in writing, under seal of such company, and signed officially by the president and secretary, "designating at least one known place of business in the state, and an authorized agent or agents residing thereat." It is declared that "it shall not be lawful" for any person to act as agent, or transact any business directly or indirectly for or on behalf of any such company corporate, until this requirement is complied with. Any one who shall act as such agent, or transact any business for such foreign company, without having first complied with such requirement, is subjected to a penalty of $500, payable to the state. The company itself that transacts or engages in any business in this state before filing such instrument is liable to a penalty of $1,000. Acts 1886-87, pp. 102-104.

The contract for services here sued on bears date March 8, 1887 and is therefore subsequent to the foregoing prohibitory enactment. The case then is reduced simply to this, assuming the facts stated in the plea to be true, as admitted by demurrer: The plaintiffs are the agents of a foreign corporation which has failed to comply with the requirements of this statute. Neither the corporation nor the agents, therefore, are authorized to transact any business in Alabama. A loan or borrowing of money by or from such company in this state is an unlawful act, subjecting both the agents and the company to a heavy penalty. The services here sued for are for the doing of this prohibited act. The consideration of the defendant's promise is an act in express violation of the constitution and laws of Alabama. The contract to pay for such illegal services is itself necessarily illegal, as a promise made in consideration of an act forbidden by law; and, being executory, the court will not lend their aid to its enforcement. It is an established rule of law, supported by uniform authority, that, when a statute goes no further even than to impose a penalty for the doing of an act, a contract founded on such act as a consideration is void, although the statute does not pronounce it void, nor expressly prohibit it. Woods v. Armstrong, 54 Ala. 150, 25 Amer. Rep. 671, and note, 675-678. In the present case there is both a penalty and express prohibition. In Woods v. Armstrong, supra, it was accordingly held, where a statute of this state imposed a penalty for selling any fertilizer which had not been inspected, analyzed, and stamped in the mode prescribed by law, a note given for the purchase money of such fertilizer sold in violation of this requirement was void. This ruling has been followed by us in many other cases. In Milton v. Haden, 32 Ala. 30, a note given for the lease of a ferry was held void on the ground that the lessor had no license, and the running of an unlicensed ferry was prohibited under a penalty. In Harrison v. Jones, 80 Ala. 412, we held that no recovery could be had for medical services rendered by an unlicensed physician, the practice of medicine in this state, without such license, being impliedly prohibited by a penalty. This ruling rests upon the general principle that when a statute forbids, under a penalty or otherwise, the carrying on of any particular business without a license, a contract made for services rendered or goods sold in violation of the requirements of such statute is void, especially if it appears that the object of the legislature was for police purposes and not solely for the purpose of raising revenue; or, in other words, where the legislative intent, in imposing the condition, was "the maintenance...