Gaboury v. Cent. Vermont Ry. Co.

• Citation: 250 N.Y. 233,165 N.E. 275
• Parties: GABOURY v. CENTRAL VERMONT RY. CO.
• Decision Date: 13 February 1929
• Court: New York Court of Appeals

250 N.Y. 233

165 N.E. 275

GABOURY

v.CENTRAL VERMONT RY. CO.

Court of Appeals of New York.

Feb. 13, 1929.

Action by Florida Gaboury, as ancillary administrator of the estate of Aime Gaboury, deceased, against the Central Vermont Railway Company. An order of the Supreme Court denying defendant's motion to vacate the service of summons and dismiss the complaint for want of jurisdiction (132 Misc. Rep. 144, 228 N. Y. S. 705) was affirmed by the Appellate Division by a divided court (225 App. Div. 145, 231 N. Y. S. 630), defendant appeals, and the Appellate Division certifies question.

Orders of Appellate Division and Special Term reversed, motion granted, and question certified answered.

The Appellate Division certified the following question:

‘Was valid service of process in this action made upon the defendant?’Appeal from Supreme Court, Appellate Division, Third Department.

Paxton Blair, of New York City, and Charles G. Fryer, of Schenectady, for appellant.

Walter A. Fullerton, and Edward W. Barrett, both of Saratoga Springs, for respondent.

CARDOZO, C. J.

Aime Gaboury, a resident of Vermont, lost his life in that state in November, 1927, while employed as a trainman by the defendant, Central Vermont Railway Company, a Vermont corporation. His father, Florida Gaboury, also a resident of Vermont, was appointed ancillary administrator of his estate by the Surrogate's Court of Clinton county, N. Y. In an action to recover damages for injuries to dependent next of kin, the summons was served on a director residing in this state. The question is whether jurisdiction was acquired.

At Rouses Point, N. Y., there is a terminal yard with equipment, the property of the Central Vermont Railway Company. There is a track, a fraction of a mile long, connecting the terminal with the line of railroad in Vermont. At the city of New York there is a pier leased by the defendant for the use of its steamships sailing between New York and New London, and thence to Portland, Me. There is also a freight office and an agency for the sale of tickets. The business is wholly interstate. Neither the vessels nor the trains carry passengers or property between places in New York.

The accident occurred near Williston, Vt., on November 24, 1927. On December 12, 1927, a decree was made by the United States District Court for the District of Vermont whereby receivers were appointed to run the defendant's railroad and conduct its business generally, and whereby the defendant, its officers, agents, and directors, were restrained from interfering with the possession of the receivers or the discharge of their official duties. A copy of the decree was filed in the Northern District of New York in accordance with the statute. U. S. Code, title 28, § 117; Judicial Code, § 56 (28 USCA § 117). At the time of the service of the summons on March 6, 1928, the business formerly the defendant's was run by the receivers.

A foreign corporation, to be subject to the service of process in New York, must have so acted as to have subjected itself to the jurisdiction of the state. It does so act when at the time of service it is doing business within our borders under the protection of our laws. Even then there are nice distinctions as to the extent of its submission when the cause of action is unrelated to the business here transacted. Pennsylvania Fire Ins. Co. of Philadelphia v. Gold Issue Min. & Mill. Co., 243 U. S. 93, 37 S. Ct. 344, 61 L. Ed. 610;Bagdon v. Philadelphia & Reading Coal & Iron Co., 217 N. Y. 432, 111 N. E. 1075, L. R. A. 1916F, 407, Ann. Cas. 1918A, 389, distinguishing Old Wayne Mut. Life Ass'n of Indianapolis, Ind., v. McDonough, 204 U. S. 8, 27 S. Ct. 236, 51 L. Ed. 345, and Simon v. Southern R. Co., 236 U. S. 115, 35 S. Ct. 255, 59 L. Ed. 492;Tauza v. Susquehanna Coal Co., 220 N. Y. 259, 115 N. E. 915;Reynolds v. Missouri, K. & T. R. Co., 228 Mass. 584, 117 N. E. 913; and cf. Barrow S. S. Co. v. Kane, 170 U. S. 100, 18 S. Ct. 526, 42 L. Ed. 964;Philadelphia & R. R. Co. v. McKibbin, 243 U. S. 264, 268, 37 S. Ct. 280 (61 L. Ed. 710);Mitchell Furniture Co. v. Selden Breck Const. Co., 257 U. S. 213, 215, 42 S. Ct. 84 (66 L. Ed. 201);Davis v. Farmers' Co-op. Equity Co., 262 U. S. 312, 317, 43 S. Ct. 556 (67 L. Ed. 996);Atchison, T. & S. F. R. Co. v. Wells, 265 U. S. 101, 44 S. Ct. 469, 68 L. Ed. 928. It does not so act when at the time of service it is no longer exercising its corporate powers within the state, or has withdrawn to its domicile. There may be exceptions even to this if the cause of action is so related to business previously done as to make it unjust or unreasonable to counteract the earlier submission by nonuser or withdrawal. Mutual Reserve Fund Life Ass'n v. Phelps, 190 U. S. 147, 23 S. Ct. 707, 47 L. Ed. 987;Woodward v. Mutual Reserve Life Ins. Co., 178 N. Y. 485, 71 N. E. 10,102 Am. St. Rep. 519;Mutual Reserve Life Ins. Co. v. Birch, 200 U. S. 612, 26 S. Ct. 752, 50 L. Ed. 620, affirming 181 N. Y. 583, 74 N. E. 1115;Hunter v. Mutual Reserve Life Ins. Co., 218 U. S. 573, 31 S. Ct. 127, 54 L. Ed. 1155, 30 L. R. A. (N. S.) 686, affirming 184 N. Y. 136, 76 N. E. 1072,30 L. R. A. (N. S.) 677, 6 Ann. Cas. 291;Chipman, Limited, v. Thomas B. Jeffrey Co., 251 U. S. 373, 40 S. Ct. 172, 64 L. Ed. 314. Broadly speaking, we may say, however, that, apart from exceptional conditions, submission to the jurisdiction is dependent upon presence within the state, and presence within the state imports the use of corporate power by corporate representatives. The service of this summons must answer to that test.

At the time of the service, the defendant, though not dissolved, was not acting as a corporation within the limits of this state. The director who received the summons did not represent it in this state in any of its corporate...