Fisher v. Mon Dak Truck Lines, Inc.

• Decision Date: 19 March 1969
• Docket Number: No. 8522,8522
• Citation: 166 N.W.2d 371
• Parties: Rosemary FISHER, the surviving wife of John M. Fisher, Plaintiff and Appellant, v. MON DAK TRUCK LINES, INC., a North Dakota Corporation, Michael A. Tracey, and Clemence Schatz, Defendants, and White Motor Corporation and Diamond T. Corporation, Defendants and Respondents. Civ.
• Court: North Dakota Supreme Court

Page 371

166 N.W.2d 371

Rosemary FISHER, the surviving wife of John M. Fisher Plaintiff and Appellant, v. MON DAK TRUCK LINES, INC., a North Dakota Corporation Michael A. Tracey, and Clemence Schatz, Defendants and White Motor Corporation and Diamond T. Corporation Defendants and Respondents.

Civ. No. 8522.

Supreme Court of North Dakota.

March 19, 1969.

Rehearing Denied April 9, 1969.

Syllabus by the Court

1. There is no definite rule by which it can be determined whether a foreign corporation is doing business in this State so as to be subject to service of process in North Dakota, and each case must be decided upon its own facts. It is generally held that a nonresident corporation must have certain minimum contacts within the territory of the forum, which must be of such character that maintenance of a suit against such foreign corporation does not offend traditional ideas of fair play and justice.

2. Section 39--01--11, North Dakota Century Code, provides that the use and operation of a motor vehicle upon the highways of this State by a nonresident shall be deemed an appointment of the Highway Commissioner to be the attorney of such nonresident upon whom service of process may be made in any action growing out of such use and operation of a motor vehicle in this State by the nonresident. Where the vehicle in question is neither used nor operated by the nonresident corporation upon whom service is sought, at the time of the accident out of which the cause of action arose, the provisions of this statute may not be used to make service of process upon such nonresident corporation.

3. Where service upon a foreign corporation is attempted to be made by serving the manager of an independent business concern doing business in the State of North Dakota, which local dealer, as part of its business, sells some of the products of the foreign corporation, and where the record shows that such North Dakota business is not subject to any control by the foreign corporation, that the foreign corporation does not maintain an office or warehouse in the State of North Dakota, that such foreign corporation upon whom service is attempted has no employees in this State, and that the local enterprise selling the products of such corporation is not subject to any control by the foreign corporation and is without any authority or power to bind the foreign corporation, such foreign corporation is not doing business in this State.

4. In order that a foreign corporation may be determined to be transacting business in this State so as to render it amenable to service of process, there must be a showing that business concerns selling its products were employed as its agents, and not merely independent business organizations transacting business for themselves.

5. An independent dealer's solicitation of business in the State of North Dakota for the sale of products of a foreign corporation does not constitute doing business in this State by such foreign corporation. Where such foreign corporation has no activity in this State except to ship its goods into the State on receipt of orders from independent local businesses, such foreign corporation is not amenable to service of process in the State of North Dakota.

6. For reasons stated in this opinion, the order of the trial court granting the motion for dismissal of summons and complaint as to the defendants White Motor Corporation and Diamond T Corporation is affirmed.

Freed, Dynes & Malloy, Dickinson, for plaintiff and appellant.

Conmy, Conmy, Rosenberg & Lucas, Bismarck, for defendants and respondents.

STRUTZ, Justice.

This is an action brought by Rosemary Fisher as surviving wife of John M. Fisher who was killed in a motor-vehicle accident in April of 1966. The action was brought against five defendants, including Diamond T Corporation, which manufactured the truck which was operated by Mon Dak Truck Lines at the time of the accident, and against White Motor Corporation, which, subsequent to the sale of the truck, merged with Diamond T Corporation. The truck in question originally was sold to Haggard Trucking Company, of Mandan, by the Farmers Union Federated Cooperative Shipping Association (Farmers Union), such sale being made in the year 1958 under circumstances as hereinafter set forth.

Both White Motor Corporation and Diamond T Corporation are foreign corporations, and neither is authorized to do business in the State of North Dakota. Service on them allegedly was made by serving one Peter Neisen, the manager of D. H. Chesley Company, of Fargo, a company that sells White Motor Corporation products, and upon Oliver F. Holman, the area manager for Oliver Corporation, which plaintiff claims now is a branch of White Motor Corporation.

The plaintiff also attempted to obtain service upon these foreign corporations by mailing a copy of the summons and complaint to one Richard Petry, of the legal division of White Motor Corporation, at the home office in Cleveland, Ohio, and by serving a summons and complaint upon the State Highway Commissioner under the provisions of Section 39--01--11, North Dakota Century Code. This section provides for service upon a nonresident motorvehicle operator who uses the North Dakota highways for the operation of his vehicle, by serving the Highway Commissioner of the State.

The defendants White Motor Corporation and Diamond T Corporation both moved for a dismissal of the summons and complaint as to them under Rule 12, North Dakota Rules of Civil Procedure, on the ground that the court had not acquired jurisdiction by proper service of process. The trial court granted such motion, and the plaintiff has appealed to this court from the order granting motion for dismissal.

There is no definite rule by which it can be determined in each case whether a foreign corporation is doing business within this State. In attempting to ascertain whether a corporation is doing business in the State of North Dakota so as to be subject to the service of process in this State, each case must be decided upon its own facts. It is generally held that a nonresident corporation must have certain minimum contacts within the territory of the forum, which must be of such character that maintenance of suit against such corporation does not offend traditional ideas of fair play and substantive justice. Consolidated Cosmetics v. D--A Pub. Co., 186 F.2d 906 (7 Cir. 1951).

The sole question for us to determine on this appeal is whether any of the plaintiff's attempted methods of service were sufficient to give the court jurisdiction over the two foreign corporations, or either of them.

We need not give consideration to the attempted service of process by serving the Highway Commissioner. Section 39--01--11 of the North Dakota Century Code provides that the use and operation of a motor vehicle upon the highways of this State by a nonresident shall be deemed an appointment of the Highway Commissioner to be his attorney upon whom service of process may be made in any action growing out of such use and operation of the motor vehicle by the nonresident upon North Dakota highways. Surely neither of these foreign corporations used the North Dakota highways or operated the motor vehicle in question upon our highways at the time of the accident, and the provisions of this statute could not, under the facts of this case, be held to make the attempted service of process valid so as to give the court jurisdiction over either of these nonresident defendants.

The plaintiff also attempted to make service of process under Section 10--22--10 of the North Dakota Century Code and Rule 4(d)(4), North Dakota Rules of Civil Procedure. Section 10--22--10 provides that when a claim shall arise out of business transacted in this State by a foreign corporation transacting business without a certificate of authority,

'* * * service of process may be made upon any person who shall be found within this state acting as an agent of, or doing business for, such corporation, or by mailing a copy thereof to the defendant corporation by registered or certified mail at its last known post office address.'

Rule 4(d)(4), North Dakota Rules of Civil Procedure, provides that personal service shall be made, under its provisions, within the State of North Dakota:

'(4) Upon a * * * foreign corporation * * * by delivering a copy of the summons to an officer, director, superintendent or managing or general agent, * * *'

Before valid service of process can be made under Section 10--22--10, North Dakota Century Code, it must be established that the defendants have been transacting business in this State, and the claim of the plaintiff must have arisen out of the business transacted within the State. Service under Rule 4(d)(4), North Dakota Rules of Civil Procedure, must be made within this State upon an officer, director, superintendent, or managing or general agent of the defendant. We first will consider whether plaintiff's claim arose out of business transacted in this State by the defendants.

The sale of the truck in question was made by Farmers Union. It took the order of the buyer for the...