General Electric Co. v. Central Transit Warehouse Co., 9387.

• Decision Date: 14 February 1955
• Docket Number: No. 9387.,9387.
• Parties: GENERAL ELECTRIC COMPANY, Plaintiff, v. CENTRAL TRANSIT WAREHOUSE COMPANY, Kansas City Terminal Warehouse Company, and Chicago Great Western Railway Company, Defendants.
• Court: U.S. District Court — Western District of Missouri

127 F. Supp. 817

GENERAL ELECTRIC COMPANY, Plaintiff, v. CENTRAL TRANSIT WAREHOUSE COMPANY, Kansas City Terminal Warehouse Company, and Chicago Great Western Railway Company, Defendants.

No. 9387.

United States District Court, W. D. Missouri, W. D.

January 22, 1955.

On Rehearing February 14, 1955.

Roy P. Swanson and Charles B. Blackmar of Blackmar, Eager, Swanson, Midgely & Jones, Kansas City, Mo., for plaintiff.

Frank H. Terrell of Terrell & Taylor, Kansas City, Mo., and Hubert Jones of Evans, Duncan, Jones, Hughes & Riley, Des Moines, Iowa, for defendants.

WHITTAKER, District Judge.

This matter is now before me upon (1) the separate motion of defendant, Central Transit Warehouse Company, to quash the return of service of process purporting to have been had upon it (because of its claim that, at the time of the institution of this suit, it was not "present" or "doing business" in this district, so as to render it amenable to service of process in this district), and to dismiss this action as to it for lack of venue (because of its similar claim that it is not "doing business" in this district in the sense of the venue statute, Section 1391, Title 28 U.S.C.A.), and for a more definite statement, and (2) the separate motions of all three defendants to transfer the cause to the District Court of the United States for the Northern District of Iowa, as a more convenient forum for its trial, under the doctrine of Forum Non Conveniens and the provisions of Section 1404(a), Title 28 U.S.C.A.

The attack made by Central Transit Warehouse Company (hereinafter called Central Transit) upon jurisdiction over its person, and upon venue, present, substantially, the same question — as both are dependent upon whether that defendant is "doing business", in this district — and those attacks will be considered together and decided first.

Plaintiff, a New York corporation, has filed a complaint, in five counts, seeking, in Count I, a judgment against Chicago Great Western Railway Company, only (hereinafter called "CGW"), in Count II, a judgment against Central Transit only, in Count III, a judgment against Kansas City Terminal Warehouse Company, only (hereinafter called "Terminal"), in Count IV, a judgment (upon an alleged warranty or guaranty of payment of the liabilities of Central Transit) against Terminal, alone, and in Count V, a judgment against any one or more of the three defendants who may be found liable, in the amount of $36,372.32, as damages to a large number of plaintiff's refrigerators and freezers suffered in shipment over the lines of defendant, CGW (or at least it was the delivering carrier) from plaintiff's manufacturing plant in Erie, Pennsylvania, to Oelwein, Iowa, or suffered while being unloaded into, and stored in, the warehouse of defendant, Central Transit, and (it is claimed also) of defendant, Terminal, at Oelwein, Iowa.

Summons was issued by the Clerk for defendant, Central Transit, and, with a copy of the complaint, was served by the Marshal, pursuant to Rule 4(d) (3) of Federal Rules of Civil Procedure, 28 U.S.C.A. and he afterward made the following return:

"I hereby certify and return that on the 7th day of October, 1954, I received this summons and served it together with the complaint herein as follows: By delivering two true copies thereof to the within named Central Transit Warehouse Company, a corporation, individually and as agent for Kansas City Terminal Warehouse Company, and the Kansas City Terminal Warehouse Company, both located at 933 Mulberry, Kansas City, Missouri, on the 14th day of October, 1954, by serving Robert R. Lester, personally, as directed by plaintiff's attorneys."

As stated, defendant, Central Transit, by its motion to quash and to dismiss, challenges, both, the sufficiency of that service to give the Court jurisdiction over its person, and the venue of the court of this action, but only upon the special ground that it was not "doing business" in this district at the time of the institution of this suit or at the time of said service of process.

In support of its motions, Central Transit has filed the affidavit of Mr. Robert R. Lester, and plaintiff, in opposition to the motion, has taken, and filed herein, several depositions, particularly, the depositions of Robert R. Lester and S. Bert Town.

This material shows that Terminal is a Missouri corporation and maintains its chief office at 933 Mulberry Street, in Kansas City, Missouri, where it is engaged in the public warehouse business; that Robert R. Lester is its President and chief managing officer; that until January 1, 1951, Terminal leased (from CGW), and operated, the warehouse, in question, located at Oelwein, Iowa, but, because the name "Kansas City" did not attract business in that area, Terminal, on or about the date mentioned, caused Central Transit to be incorporated under the laws of Iowa, and the latter, thereupon, leased (from CGW), and since has operated, the warehouse at Oelwein, Iowa; that all of the capital stock of Central Transit is owned by Terminal.

That Terminal has another affiliated warehouse company, known as Midland Warehouse Company (hereinafter called "Midland"), which is licensed to do, and is doing, business at Oelwein, Iowa.

That Central Transit has no directly employed employees in Iowa, but uses, for its physical work at Oelwein, laborers, and an "office manager" (Mrs. O'Hara), who are directly employed by Midland, and Central Transit periodically reimburses Midland for that service.

The officers of Central Transit are Robert R. Lester, President, and Treasurer, S. Bert Town, Vice-President, and Frank H. Terrell, Secretary, and they all live in Kansas City, Missouri, and, except for Mr. Terrell, who is a Kansas City lawyer, they are, principally, employed as the managing officers of Terminal, maintaining their offices in Terminal's facilities at 933 Mulberry Street, in Kansas City, Missouri.

That Central Transit has no formal, or clearly admitted, office in Missouri, but that Midland maintains an office at 1212 Waldheim Building in Kansas City, Missouri, which is a small office with only two women and, apparently, one man (Mr. Gregg) in it; that Central Transit uses that office as its Kansas City address. On that score Mr. Lester testified "When we needed to have a Kansas City address, we gave that as an address." Central Transit uses a letterhead stating "1212 Waldheim Building" to be its Kansas City, Missouri address, but its name is not on the door of that office.

That Mr. Lester and Mr. Town are the only directly employed employees of Central Transit, and its chief managing officer is Mr. Lester, who operates from his office in Terminal's facilities, at 933 Mulberry Street in Kansas City, Missouri, except that he makes a trip to Oelwein, Iowa, about every three months, and that, under Mr. Lester, the person primarily in charge of the Oelwein operation for Central Transit is Mr. Town, who also maintains his office at 933 Mulberry Street, in Kansas City, and spends about two days per week in Oelwein; that Mr. Town, when not in Oelwein, communicates with Mrs. O'Hara, the "office manager" (directly employed by Midland), at Oelwein, and she with him, at Kansas City, Missouri, by telephone, memoranda and correspondence; that frequently such, and other, correspondence for Central Transit is directed to, and received at, 1212 Waldheim Building, Kansas City, Misssouri, to avoid "confusion", and all Central Transit mail received there is referred to Mr. Town at 933 Mulberry Street.

That one-seventh of Mr. Lester's salary is paid by Central Transit and the balance is paid by Terminal and other affiliated warehouse companies. The record does not show what percentage of Mr. Town's salary is paid by Central Transit.

That both Mr. Lester and Mr. Town, at 933 Mulberry Street, conduct correspondence for Central Transit, solicit business and quote rates for it, and they each maintain correspondence files for it at that place, and all loss and damage claims against Central Transit are referred to, and handled by, Mr. Lester at that place, and, apparently, Mr. Lester there makes contracts for Central Transit, at least the CGW lease covering the Oelwein warehouse was negotiated and executed by him in Kansas City.

That, apparently, Midland conducts some correspondence for Central Transit at 1212 Waldheim Building because Mr. Lester testified that Central Transit pays Midland $65 per month for services of the Waldheim Building stenographic staff and for forwarding mail addressed to Central Transit. It also appears that the general ledger of Central Transit is kept and maintained at 1212 Waldheim Building where a bookkeeper (Mr. Gregg), employed and paid by Terminal, posts the general ledger from original entries prepared at Oelwein and forwarded by Mrs. O'Hara, and, for this service, Central Transit pays Terminal $100 per month.

It clearly appears that not only are all of the officers of Central Transit residents of, and permanently based and performing the major part of their work for Central Transit, in, Kansas City, but, in addition, all of its directors (Mr. Lester, Mr. Terrell, Mr. Raymond, Mr. Dean, and Miss Ridenour) are citizens and residents of Kansas City, Missouri, and all of the directors' meetings of the company are held in Kansas City (at the office of Mr. Terrell, who is Secretary of, and counsel for, the company), and its By-Laws, corporate minutes, stock book, and at least a duplicate corporate seal, are kept and maintained in Kansas City, at Mr. Terrell's office; and, in addition to the general ledger of the company being kept, posted, and maintained, in Kansas City (at 1212 Waldheim Building), the company has a bank account in Kansas City (as well as a more active one at Oelwein), and maintains a check book at Kansas City where, in usual course, checks in payment of the company's obligations are written and signed by Mr. Lester, but, occasionally, Mrs. O'Hara,...