Hagerstown Brewing Co. v. Gates
| Decision Date | 31 January 1912 |
| Citation | 83 A. 570,117 Md. 348 |
| Parties | HAGERSTOWN BREWING CO. v. GATES. |
| Court | Maryland Court of Appeals |
Appeal from Circuit Court, Allegany County; Robert R. Henderson Judge.
Action by George E. Gates against the Hagerstown Brewing Company. From a judgment for plaintiff, defendant appeals. Affirmed.
Alexander R. Hagner and Albert A. Doub, for appellant. A. C. Strite and F. G. Wagaman, for appellee.
The appeal in this case is from a judgment recovered against the Hagerstown Brewing Company, a corporation (appellant), on two contracts executed in its name by its president and general manager, indorsed on and guaranteeing the payment of two single bills of one Kurtz in favor of the appellee, each for the sum of $500, and both dated the 18th of November, 1907 one payable 27 months after date, and the other payable 30 months after date.
The case was instituted in the circuit court for Washington county, and the declaration contained five of the common counts and four special counts. The sixth count charges that the plaintiff was the owner of a stock of goods, fixtures etc.; that Kurtz desired to purchase the same and to give in part payment therefor his promissory note under seal or single bill for $500, dated November 18, 1907, and payable 27 months after date; that the defendant, "by its servants and agents, while acting within the scope of their authority, promised and agreed with" the plaintiff that if the plaintiff would sell and deliver said stock of goods, fixtures, etc., to Kurtz, it would pay said single bill "at its maturity"; that the plaintiff, in consideration of the defendant's promise, sold and delivered said stock of goods, fixtures, etc., to Kurtz, but Kurtz did not pay said single bill; and that the defendant had due notice of that fact, but refused to pay the same when requested to do so. The seventh count makes the same charge in reference to the single bill payable 30 months after date. And the eighth count alleges: That the plaintiff was the owner of the stock of goods, etc., and that Kurtz desired to purchase the same and to give in part payment therefor his single bill in the following words: That the defendant, by its agents and servants, while acting within the scope of their authority, had "previously written on the back" of said single bill as follows: And the plaintiff accepted the single bill with said indorsement thereon in part payment for his stock of goods, etc., and delivered said goods to Kurtz, but Kurtz did not pay said single bill, and that the defendant, after due notice thereof, has also failed to pay the amount due thereon. The averments of the ninth count are the same in reference to the single bill payable 30 months after date.
The defendant filed two pleas, first, that it never promised as alleged, and, second, that it never was indebted as alleged, and demurred to the sixth, seventh, eighth, and ninth counts of the declaration. The plaintiff joined issue on the pleas, and on the 6th of October, 1910, upon the suggestion and affidavit of the defendant, the case was removed to the circuit court for Allegany county. That court overruled the demurrers to the sixth, seventh, eighth, and ninth counts of the narr., and on the same day the defendant filed its third and fourth pleas to those counts and its fifth plea to the declaration. By the third plea the defendant says that "it was incorporated in the year 1898 under the provisions of the general laws of the state of Delaware for the purpose of brewing, manufacturing, and making beer and other kinds of malt liquors, and for the sale, transportation, or other disposition of the products of said business, and these are the only powers given to it by its certificate of incorporation, and that it has not the power to guarantee the obligations of other persons except for a valuable consideration moving to the said defendant, and that the said alleged promise or guaranty of the said defendant on said promissory note was wholly without consideration and is ultra vires on the part of the defendant and void and unenforceable by a suit against the defendant." The fourth plea alleges that the indorsements were made without the authority of the defendant and have not been ratified by it, and the fifth plea, which on motion of the plaintiff was not received, says that the plaintiff "is and has been a resident of the state of Pennsylvania since before the execution of the alleged promissory notes sued on and indorsements thereon, and that the alleged cause of action arose in the state of Pennsylvania, and did not arise in the state of Maryland, and the subject of the action is not and has never been situated in this state, and that the defendant is and has been a nonresident of the state of Maryland since before the execution of the alleged promissory notes sued on and indorsements thereon, and that both plaintiff and defendant are nonresidents of the state of Maryland, and that the plaintiff has no right of action in this court." The plaintiff joined issue on the fourth plea, and filed six replications to the third plea. The court below sustained a demurrer to the first and fifth replications, and issue was joined on the second, third, fourth, and sixth replications, which deny the averments of the plea that the promises of the defendant were made without consideration and were ultra vires, and allege that they were made for valuable considerations "moving to the defendant," and that the certificate of incorporation did give the defendant power to guarantee the obligation of others, etc. During the trial of the case the defendant reserved seven exceptions, the first six of which relate to rulings on the evidence, and the seventh to the granting of the plaintiff's first, third, and fifth prayers, and the rejection of the defendant's first, second, third, fifth, sixth, ninth, tenth, and eleventh prayers and a modification of its eighth prayer.
The defendant's fifth prayer presents its contention that a nonresident of this state cannot sue a foreign corporation in the courts of this state on a contract made in some other state. That was undoubtedly the law prior to the Act of 1908, c. 240, except where the subject of the action was situated in this state; but section 67 of that act declares that "any person or corporation, whether a resident or a nonresident of this state, may sue any foreign corporation regularly doing business or regularly exercising any of its franchises therein for any cause of action." This language is very broad and clear, and the right of a nonresident to sue a foreign corporation in the courts of this state is no longer confined to cases in which "the cause of action has arisen, or the subject of the action shall be situated in this state," as was the case under section 411 of article 23 of the Code, which was expressly repealed by the Act of 1908.
The appellant insists, however, that section 67 of chapter 240 of the Acts of 1908 was repealed or modified by the later act of 1908, c. 309, which provides that "any corporation now chartered by the laws of this state, which shall transact business therein, shall be deemed to hold and exercise franchises within this state, and shall be liable to suit in any of the courts of this state on any dealings or transactions therein, and also shall be liable to suit in any of the courts of this state, on any controversy which may arise between such corporation and any resident of this state." This act is practically section 409 of article 23 of the Code of 1904 with the additional provision for controversies between such corporations and residents of this state. It was never suggested that section 409 of the Code so modified the provisions of section 411 as to confine the jurisdiction of our courts to suits against nonresident corporations on transactions in the state; on the contrary it was repeatedly held that, under section 411, they had jurisdiction also in cases where "the subject of the action" was situated in this state (Cromwell et al. v. Royal Canadian Ins. Co., 49 Md. 382, 33 Am. Rep. 258; Universal Life Ins. Co. v. Bachus, 51 Md. 31), and there is no more reason for holding that chapter 309 of the Act of 1908 repeals or modifies section 67 of chapter 240 than that section 411 of the Code was restricted or limited by section 409. Chapter 309 does not expressly repeal chapter 240, and if allowed the effect contended for by the appellant, it would take away the jurisdiction of our courts in cases of suits by nonresidents against foreign corporations where the subject of the action is...
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