J.A. Fay & Co. v. Richmond

• Decision Date: 09 June 1885
• Citation: 18 Mo.App. 355
• Court: Missouri Court of Appeals
• Parties: J. A. FAY & COMPANY, Respondent, v. L. L. RICHMOND, Appellant.

18 Mo.App. 355

J. A. FAY & COMPANY, Respondent,

v.L. L. RICHMOND, Appellant.

St. Louis Court of Appeals, Missouri.

Jun. 9, 1885.

APPEAL from the St. Louis Circuit Court, BARCLAY, J.

Affirmed.

H. D. LAUGHLIN and M. F. TAYLOR, for the appellant: Under the law of Missouri, no corporation having such a name as the plaintiff can be organized; and no state has ever yet given extra-territorial force to the laws of her sister state when they were of a character prohibited by the laws of the state in which they were sought to be enforced. Upon this point we refer the court to the following authorities: Dennick v. Railroad Company, 103 U. S. 11; Leonard v. Navigation Company, 84 N. Y. 48; Smith v. Bull, 17 Wend. 323; Crowell v. Panama R. W. Co., 30 Barb. 99; Wahl v. Hoskins, 5 Ire., N. C. 177; Madrazo v. Willes, 3 B. and A. 353; Mostyn v. Fabrigas, 1 Cowp. 161; McDonald v. Mallory, 77 N. Y. 547; Story on Conflict and Laws, sect. 307. Our contention is that upon the statement of the plaintiff's case and the evidence before the jury that this is no such finding of the real issues involved in the cause as would authorize the court to enter up a judgment against Richmond as member of a partnership called Richmond Iron and Steel Works, and we cite the court in support of that proposition to the following authorities: Barbour v. White, 37 Ill. 164; Wood v. McGuire's Children, 17 Ga. 361; Pattison v. United States, 2 Wheat. 221; Schweickhardt v. City of St. Louis, 2 Mo. App. 582; Soll v. Bacon, 8 Mo. App. 509; Hewson v. Tootle, 72 Mo. 636.

ROEDER & RICHIE, for the respondent: A statute which merely prohibits foreign corporations from doing business in this state without the compliance with certain formalities and imposes a penalty, but which does not expressly declare that contracts made in violation of the statute shall be unlawful, will not avoid contracts made without authority in this state. Columbus Ins. Co. v. Walsh, 18 Mo. 229; Clark v. Middleton, 19 Mo. 53; Walter A. Wood & Co. v. Caldwell, 54 Ind. 270-275; Northwestern Life Ins. Co. v. Overholt, 4 Dill. 287.

THOMPSON, J., delivered the opinion of the court.

This was an action upon a promissory note against L. L. Richmond, Frank B. Johnson and J. Redfern Moore. Richmond alone was served with process and the action proceeded alone against him. The plaintiff had a verdict and judgment, and the defendant appeals to this court.

The petition was in the following language: Plaintiff states that it is a corporation organized under the laws of the state of Ohio; that on the 4th day of April, 1882, the defendants were co-partners doing business under the firm name of the Richmond Iron and Steel Works; that on said day the defendants by their said firm name made their promissory note, herewith filed, by which they promised, for full value received, to pay plaintiff the sum of $500.00 ninety days after the date thereof, which sum and the interest thereon are yet due plaintiff, for which sum it asks judgment, with costs.

The note referred to in the petition upon which the action was brought was as follows:

“$500.00.

EAST ST. LOUIS, ILL., April 4, 1882.

Ninety days after date, for value received, we promise to pay to the order of J. A. Fay & Co. $500.00 at the International Bank, with interest at the rate of 8 per cent. per annum from date.

RICHMOND IRON AND STEEL WORKS,

per L. L. RICHMOND, President.

FRANK B. JOHNSON, Sec. and Treas.”

The answer set up six separate defences.

The first defence was, that the plaintiff was a foreign corporation carrying on the business of manufacturing and dealing in wood and iron machinery with the corporate name of J. A. Fay & Co.; that that name is the name of a firm, and there is not joined any word designating the business to be carried on as required by the laws of the state of Missouri; that the plaintiff, as a corporation under said name, carried on its said business of manufacturer and dealer in wood and iron work in the city of St. Louis during the years 1881 and 1882; that the cause of action alleged in the petition and the consideration for the note sued on arose wholly from the plaintiff's business in this state, and the note was made and delivered in this state; that defendant understood that plaintiff was a firm composed of J. A. Fay and one or more partners, and was not a corporation; that as the corporate name of the plaintiff was one forbidden to be used by a corporation in the state of Missouri, the plaintiff could not bring or prosecute the suit in any court in this state, and for that reason had no legal capacity to sue at the time of the commencement of the action.

The second defence was an allegation that as the name used by the plaintiff was one forbidden by the laws of this state, it was against the policy of the state to permit it to do business, and, therefore, the note was illegal, and void and constituted no cause for action.

The third defence was a general denial.

The fourth defence alleged that the note was obtained from the Richmond Iron and Steel Works by the false representation made with the intent to deceive and defraud; that the Richmond Iron and Steel Works was indebted to the plaintiff in the amount of the note; that this was done by collusion with one Johnson, and that at the time the Richmond Iron and Steel Works was not indebted to plaintiff in any way and received no consideration for the note.

The fifth defence consisted of an allegation that the Richmond Iron and Steel Works made the note in the belief that it was indebted to the plaintiff in the sum of $500, when as a matter of fact it was not indebted to the plaintiff in any sum.

The sixth defence was an allegation that the Richmond Iron and Steel Works was a corporation with a capital stock of $5,000 fully subscribed under the laws of the state of Illinois, and that the officers and members of the corporation, under the law of the state of Illinois, were fully exempted from all personal liability for the debts of the corporation; that the note mentioned in the petition was made by the Richmond Iron and Steel Works as and for its obligation as a corporation and not otherwise, all of which was well known to the plaintiff, and the note was accepted and received as the note and the obligation of said corporation.

The reply admitted that the consideration for the note arose wholly from the business of plaintiff in this state, and that the note was made and delivered in this state as alleged in the answer, and then denied all other allegations of the answer.

Before the introduction of any testimony, defendant objected to the admission of any evidence, on the ground that the allegations of the petition did not make out a cause of action against anybody, and, also, on the ground that there was no allegation in the petition that the note sued on was ever delivered. The objection was overruled, to which ruling an exception was saved.

The testimony tended to show that before the making of the note sued on, Richmond, Moore, and Johnson had determined to organize a corporation under the laws of Illinois for the purpose of experimenting with certain patents for repairing and re-rolling iron and steel rails, which patents were owned by Moore and Johnson; that the business of the corporation was to be carried on at East St. Louis, Illinois; that certain goods had been purchased by Moore and Johnson of the plaintiff of a character suitable to be used in such experiments; that a portion of those goods was destroyed by fire in East St. Louis; that the portion saved from the fire was turned over to the Richmond Iron and Steel Works, the attempted corporation, and charged to it; and that the note sued on was given in payment of the goods so purchased.

The following instructions offered by the defendant, were refused:

“1. Defendant, Richmond, asks the court to instruct the jury that on the evidence the plaintiff is not entitled to recover.

2. Unless the note sued on was given for a debt due plaintiff from the Richmond Iron and Steel Works, or, unless the defendant, Richmond, knowingly executed it in payment of the debt of another, the plaintiff can not recover in this suit against him.

3. If the plaintiff accepted the note sued on as a note of a corporation called the Richmond Iron and Steel Works, in payment of a debt due it only for Moore and Johnson, they can not recover in this action...