Kagan v. United Vacuum Appliance Corp.

• Citation: 260 N.E.2d 208,357 Mass. 680
• Parties: Sldney J. KAGAN, trustee in bankruptcy, v. UNITED VACUUM APPLIANCE CORPORATION.
• Decision Date: 16 June 1970
• Court: United States State Supreme Judicial Court of Massachusetts

Page 208

260 N.E.2d 208

357 Mass. 680

Sldney J. KAGAN, trustee in bankruptcy, v. UNITED VACUUM APPLIANCE CORPORATION.

Supreme Judicial Court of Massachusetts, Suffolk.

Argued Jan. 6, 1970.

Decided June 16, 1970.

Samuel Newman, Boston, for plaintiff.

Mark A. Michelson, Boston, for defendant.

Before WILKINS, C.J., and KIRK, SPIEGEL, and REARDON, JJ.

WILKINS, Chief Justice.

The plaintiff, the trustee in bankruptcy of D.C. Industries, Inc. (Industries) of Boston, on October 28, 1968, filed this bill in equity for declaratory relief against the defendant United Vacuum Appliance Corporation (Vacuum) of Connersville, Indiana. He seeks an interpretation of a contract of conditional sale of certain equipment purchased of the defendant by the bankrupt. A judge of the Superior Court, after hearing, sustained an answer in abatement and plea to the jurisdiction, and dismissed the bill. The plaintiff appealed. There are no findings. The evidence is reported.

Jurisdiction, according to the bill, is sought under G.L. c. 223A, inserted by St.1968, c. 760, the long-arm statute, on the ground that the defendant corporation has transacted business in this Commonwealth and has contracted to supply services and things in this Commonwealth as set forth in a contract of conditional sale of certain equipment dated October 26, 1966, between Industries and Vacuum. An involuntary petition in bankruptcy was filed on April 23, 1968, and Industries was adjudicated bankrupt. Thereafter Vacuum entered the premises of Industries in Everett and repossessed the equipment set forth in the contract of conditional sale.

The defendant, appearing specially, filed the answer in abatement and plea to the jurisdiction making the following allegations. It is not doing and never has done business in this Commonwealth. It has no property, real or personal, and no place of business here. It never has authorized any person to act as agent for service of process here. It has no agent or other officer in charge of its business and has never registered to do business here. It has not contracted to supply services and things in this Commonwealth. Its activities do not come within the scope of G.L. c. 223A. The activities alleged by the plaintiff all took place before the effective date of G.L. c. 223A.

The defendant raises numerous defences, many of which raise questions as to jurisdiction under the statute or to the service of process. We consider many of these.

1. Fundamentally, the defendant contends that G.L. c. 223A became effective after the suit was filed, specifically on October 23, 1968. The statute was inserted by St.1968, c. 760, which was approved on July 25, 1968. The argument is that it did not become effective until ninety days after enactment because of art. 48, The Referendum, I, of the Amendments to our Constitution, which provides: 'No law passed by the general court shall take effect earlier than ninety days after it has become a law, excepting laws declared to be emergency laws and laws which may not be made the subject of a referendum petition, as herein provided.' Statute 1968, c. 760, comes within the exception; it is a law which 'relates to * * * the powers * * * of courts' and cannot be made the subject of a referendum. Art. 48, The Referendum, III, § 2. See Commonwealth v. Sacco, 255 Mass. 369, 411, 151 N.E. 839 (statute extending time for granting a new trial). A law not subject to a referendum falls within G.L. c. 4, § 1, effective on the thirtieth day after enactment. In other words, c. 760 became effective on August 24, 1968, before the filing of the present suit.

2. The defendant takes the position that the long-arm statute as in effect when suit was begun did not embrace suits in equity. The basis of the argument is that c. 223A, § 3, reads, 'A court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a cause of action arising from the person's (a) transacting business in this commonwealth * * *' (italics supplied). From this it is argued that 'cause of action' has acquired a technical meaning of referring to only actions at law, citing Gould's Case, 215 Mass. 480, 482, 102 N.E. 693. We do not agree that this restrictive interpretation is required. "Cause of action' is a comprehensive expression and may have somewhat variant significations. It ought not to be narrowed by attempts at definition. It includes violation of a right or breach of a duty for which the law provides a remedy in the courts. It is the specified subject made the basis of controversy in legal procedure. It is for all purposes of a particular proceeding in court that which is declared in the pleadings as the ground of liability.' Shapiro v. McCarthy, 279 Mass. 425, 430, 181 N.E. 842, 844. See Jordan v. County Commrs. of Bristol, 268 Mass. 329, 332, 167 N.E. 652.

We do not regard as decisive the amendment of c. 223A, § 3, by St.1969, c. 623, which inserted the words, 'in law or equity' after 'cause of action' in the quotation, supra. The same construction would have been reached before the amendment.

3. A broader contention of the defendant is that c. 223A should not be applied retroactively. In Hanscom v. Malden & Melrose Gas Light Co., 220 Mass. 1, 3, 107 N.E. 426, 427, Chief Justice Rugg stated: 'The general rule of interpretation is that all statutes are prospective in their operation, unless an intention that they shall be retrospective appears by necessary implication from their words, context or objects when considered in the light of the subject matter, the pre-existing state of the law and the effect upon existent rights, remedies and obligations. Doubtless all legislation commonly looks to the future, not to the past, and has no retroactive effect unless such effect manifestly is required by unequivocal terms. It is only statutes regulating practice, procedure and evidence, in short, those relating to remedies and not affecting substantive rights, that commonly are treated as operating retroactively, and as applying to pending actions or causes of action.' There are now many decisions in this Commonwealth holding that cases dealing with the remedy are retrospective. Examples of these are Ring v. Woburn, 311 Mass. 679, 682, 43 N.E.2d 8; Greenaway's Case, 319 Mass. 121, 123, 65 N.E.2d 16; Berkwitz, petitioner, 323 Mass. 41, 47, 80 N.E.2d 45; Goddu's Case, 323 Mass. 397, 399, 82 N.E.2d 232; Attorney Gen. v. Flynn, 331 Mass. 413, 415, 120 N.E.2d 296; Lindberg v. State Tax Commn., 335 Mass. 141, 143, 138 N.E.2d 753, and Welch v. Mayor of Taunton, 343 Mass. 485, 486, 179 N.E.2d 890.

The question then becomes whether the long-arm statute is remedial and does not affect substance. In Paraboschi v. Shaw, 258 Mass. 531, 155 N.E. 445, the statute made the operation of an automobile on our highways by a nonresident equivalent to an appointment of the registrar of motor vehicles as agent for the service of process in certain circumstances. This contractual obligation was held to be substantive and not retrospective. The long-arm statute, however, is not based on implied consent. Upon analysis, what it does is to make the doing of certain acts the basis of jurisdiction over a nonresident. This type of statute which is not based on assumed consent has consistently been held to be remedial and has been applied to a cause of action accruing prior to its enactment. See Safeway...