June v. Vibra Screw Feeders, Inc.

• Decision Date: 13 April 1967
• Docket Number: Docket No. 2022,No. 2,2
• Citation: 149 N.W.2d 480,6 Mich.App. 484
• Parties: Robert JUNE, II, d/b/a June Equipment Sales, Plaintiff-Appellee, v. VIBRA SCREW FEEDERS, INC., a/k/a Vibra Screw Sales Company, Inc., Defendant-Appellant
• Court: Court of Appeal of Michigan — District of US

Page 480

149 N.W.2d 480

6 Mich.App. 484

Robert JUNE, II, d/b/a June Equipment Sales, Plaintiff-Appellee, v. VIBRA SCREW FEEDERS, INC., a/k/a Vibra Screw Sales Company Inc., Defendant-Appellant.

Docket No. 2022.

Court of Appeals of Michigan, Division No. 2.

April 13, 1967.

Rehearing Denied May 22, 1967.

Harry D. Wise, Jr., Birmingham, for appellant.

William A. Ortman, Detroit, for appellee.

Before T. G. KAVANAGH, P.J., and GILLIS and McGREGOR, JJ.

McGREGOR, Judge.

Appellant in this case is a New Jersey corporation which specializes in industrial machines designed to feed special material into certain manufacturing processes. Appellee was, from 1957 until 1963, the Michigan representative of the appellant. In 1963, appellee's representation was, by agreement between the parties, limited to certain areas of Michigan. This action was originated because of an alleged breach of contract for payment of commissions due for the sale of the appellant's product in Michigan.

The merits of the original controversy are not before this Court and the parties on appeal confront each other only on procedural grounds. The amount of the alleged disputed commissions owed was, after payments, reduced to about $3,700.

The attorneys in this case made several appearances in the circuit court during late 1965 and early 1966. They reported to the court that they were near settlement; however, settlement was never reached. Counsel for the appellant on several occasions stated the matter could be cleared up if officers and executives of the appellant corporation could appear in court. The trial judge finally invoked GCR 1963, 506.1 and ordered the president and sales manager of the appellant corporation and the appellee to appear in court to testify. The counsels agreed to an order, which was drawn up in appellant's counsel's office, compelling the parties to attend or face default judgment. On the appointed day, the appellant's counsel notified the court that his clients would not appear and that he wished to appeal the order of appearance. The trial court acted to protect the appellant's appeal rights, but granted summary judgment in favor of the appellee.

This appeal is now pursued on the theory that the original service of process upon the present Michigan representative of the appellant, and successor to the appellee, was improper as the agent had no authority to be so served; that Michigan does not properly have jurisdiction over the New Jersey corporation; that the appellee is not properly before the courts of Michigan because of failure to file a statutory assumed name form; that the appellants are entitled to the measures under GCR 1963, 305., if ordered to Michigan, including payment by the appellee of all expenses of travel of the appellant's officers; and that on the basis of the incomplete proceedings, the appellee was not entitled to summary judgment.

The appellant makes some claim that the parties are not determined as the name Vibra Screw is a part of the name of two different corporations, Vibra Screw Feeders, Inc., and Vibra Screw Sales, Inc. The appellant also claims that neither corporation existed in 1957, when the original contract with the appellee was allegedly created. From the record and exhibits it is clear that Eugene A. Wahl, the president of both Vibra Screw Feeders, Inc. and Vibra Screw Sales Company, Inc., personally conducted the business of these corporations, as he did in his own behalf, using the corporation names, before the corporations were officially chartered. The letter-heads and invoices of the corporations were used interchangeably by Mr. Wahl in his dealings with the appellee. Applying the principles of equitable estoppel (see 28 Am.Jur.2d, Estoppel and Waiver, § 28, at 629--632, 31 C.J.S. Estoppel § 69, at 415--416, and § 71 at 428--429), the appellant is estopped in this action from claiming any legal recognition of the separate corporate entities which have been set up by the appellant and which have been ignored in the past by the appellant in dealing with the appellee. We find that the appellant in this action is not incorrectly titled 'Vibra Screw Feeders, Inc., a/k/a Vibra Screw Sales Company, Inc.' and the appellant is properly identified.

The question of jurisdiction over foreign corporations and the service of process on foreign corporations were both covered in the leading case of International Shoe Company v. State of Washington (1945), 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95. On page 316, 66 S.Ct. on page 158 of the opinion, the question of jurisdiction over foreign corporations was covered by Chief Justice Stone, thus:

'due process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.' Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 343, 85 L.Ed. 278 (283), 132 A.L.R. 1357.' (Citing further authorities)

The opinion of the court continued to cover this issue and the issue of service of process. On pages 316 and 317, 66 S.Ct. on page 158, the Chief Justice stated:

'Since the corporate personality is a fiction, although a fiction intended to be acted upon as though it were a fact, Klein v. Board of Tax Supervisors, 282 U.S. 19, 24, 51 S.Ct. 15, 16, 75 L.Ed. 140 (143), 73 A.L.R. 679, it is clear that unlike an individual its 'presence' without, as well as within, the state of its origin can be manifested only by activities carried on in its behalf by those who are authorized to act for it. To say that the corporation is so far 'present' there as to satisfy due process requirements, for purposes of taxation or the maintenance of suits against it in the courts of the state, is to beg the question to be decided. For the terms 'present' or 'presence' are used merely to symbolize those activities of the corporation's agent within the state which courts will deem to be sufficient to satisfy the demands of due process. * * *

"Presidence' in the state in this sense has never been doubted when the activities of the corporation there have not only been continuous and systematic, but also give rise to the liabilities sued on, even though no consent to be sued or authorization to an agent to accept service of process has been given.' (Citing authorities.)

and on page 320, 66 S.Ct. on page 160:

'We are likewise unable to conclude that the service of the process within the state upon an agent whose activities establish appellant's 'presence' there was not sufficient notice of the suit, or that the suit was so unrelated to those activities as to make the agent an inappropriate vehicle for communicating the notice. It is enough that appellant has established such contacts with the state that the particular form of substituted service adopted there gives reasonable assurance that the notice will be actual.' (Citing authorities)

Also, see Jennings v. W.S.M., Inc. (1963), 369 Mich. 210, 119 N.W.2d 598; National Concessions, Inc. v. National Circus Corporations (1956), 347 Mich. 335, 79 N.W.2d 910, H. F. Campbell Construction Co. v. Palombit (1956), 347 Mich. 340, 79 N.W.2d 915.

Jurisdiction over foreign corporations was expressed in statutory form by the Michigan Legislature in the Revised Judicature Act:

'Sec. 711. The existence of any of the following relationships between a corporation and the state shall constitute a sufficient basis of jurisdiction to enable the courts of record of this state to exercise general personal jurisdiction over such corporation and to enable such courts to render...