Kaw Boiler Works Company v. Refineries
| Decision Date | 06 June 1925 |
| Docket Number | 25,885 |
| Citation | 118 Kan. 693,236 P. 654 |
| Parties | KAW BOILER WORKS COMPANY, Appellee, v. INTERSTATE REFINERIES, Appellant |
| Court | Kansas Supreme Court |
Decided January, 1925.
Appeal from Wyandotte district court, division No. 2; FRANK D HUTCHINGS, judge.
Judgment affirmed.
SYLLABUS BY THE COURT.
1. CORPORATIONS--Foreign--Acts Appropriate to Interstate Sale. Where the plaintiff, a Kansas corporation, having its principal place of business and manufacturing plant in Kansas City, Kan., there entered into certain contracts with the defendant to furnish the equipment for the erection of an oil-cracking refinery in Kansas City, Mo., and where the defendant declined to pay for the equipment because plaintiff was not authorized, under the statutes, to do business in Missouri: Held, (a) A provision that the plaintiff should assemble and erect the machinery in question at the point of destination and test it was relevant and appropriate to an interstate sale; (b) The attachment of parts of the machinery at defendant's plant in Missouri by the plaintiff under the circumstances stated in the opinion was relevant and appropriate to an interstate sale.
2. SAME--Consideration Generally. Various assignments of error considered and held not to be of substantial merit.
O. J. Stanley, of Kansas City, J. M. Johnson, and C. O. French, both of Kansas City, Mo., for the appellant.
Edwin S. McAnany, Maurice L. Alden, Thos. M. VanCleave, all of Kansas City, and Clyde Taylor, of Kansas City, Mo., for the appellee.
The action was one to recover a balance of the purchase price of certain oil-refinery equipment. The plaintiff prevailed, and defendant appeals.
The plaintiff is a Kansas corporation having its principal place of business in Kansas City, Kan. The defendant is a Delaware corporation engaged in the oil business, with its principal office in Kansas City, Mo. Certain contracts were entered into between the parties, whereby the plaintiff furnished to defendant the equipment for the erection of an oil-cracking refinery at its plant in Kansas City, Mo. The defendant declined to pay for the equipment, chiefly because plaintiff was not authorized under the statute to do business in Missouri. Trial was to a jury. Verdict for plaintiff for $ 29,915.71, and special findings as follows:
The defendant contends it is not liable for the equipment because the plaintiff was not licensed to do business in Missouri; that the contracts were made in Missouri; that the work performed by plaintiff was, at least in part, performed in Missouri; that Missouri has a statute providing that if a foreign corporation shall, without license, do local business in Missouri it cannot maintain an action on account thereof.
Plaintiff contends that the contracts were made in Kansas; that the equipment was manufactured or fabricated in Kansas, was accepted by defendant in Kansas; that, as to some of the equipment, while it was fabricated in Kansas, it was too bulky to be shipped set up, and the erection thereof alone was done in Missouri; that, as to this, the erection in Missouri was but an incident of a valid interstate transaction, and hence not within the Missouri statute. The Missouri statutes require, as a condition precedent to doing business in that state, that a foreign corporation shall obtain a license to do business. It is conceded that plaintiff had no such license.
The defendant contends that the plaintiff maintained an office and transacted its business in Missouri. The evidence showed that F. G. Palmer and E. L. Hudson, president and vice president and manager of the plaintiff, are interested in another business known as Weimer Mortgage and Real Estate Company, which has no connection with the plaintiff company. The mortgage company has an office in the Waldheim building in Kansas City, Mo. The plaintiff's name appears on the office door, and in the office is a telephone listed in plaintiff's name. The plaintiff company pays a part of the rent of the office and the salary of a stenographer who works at the Kansas plant and occasionally in this Missouri office. Persons coming to Kansas City to transact business with the plaintiff company usually come to the Union Station in Kansas City, Mo., and communicate with this office. But so far as plaintiff's business is concerned, this Missouri office is used largely as a meeting place. Its directors' meetings are not held there, no books are kept there, no collections are made or received there, no contracts are made there, no goods sold there, no samples kept there. Plaintiff's books are kept and the business of the company is transacted in the Kansas office. It clearly appears that the contracts involved in this controversy were made in Kansas. But if they were to be performed in Missouri they were void. (United Shoe Machinery Co. v. Ramlose, 210 Mo. 631; Booth v. Scott, 276 Mo. 1, 205 S.W. 633; United Shoe Machinery Co. v. Ramlose, 231 Mo. 508, 545, 132 S.W. 1133; State, ex rel., v. Robinson, 271 Mo. 475.) If they were to be and actually were performed in Kansas, then they were not void. The facts warrant the conclusion that they were to be performed in Kansas; that only incidental matters necessary to their completion were to be and were performed in Missouri.
There were four classes of equipment furnished: Two preheating stills, two pressure stills, two dephlegmating towers, and three storage tanks of 10,000, 5,000 and 2,500 barrels capacity, respectively. Each class of equipment was the subject of a separate contract, and each constituted an essential unit, performing an indispensable function in a new refining process for the defendant. The apparatus was intricate and complex both in its fabrication and in its operation. The process being new, no such equipment had theretofore been manufactured. It involved fabrication of steel of unusual quality, thickness and other dimensions. It was designed to work under unusual temperature and extraordinary pressure. It was necessary to procure special steel from Pennsylvania and to design special tools for its fabrication. Being experimental, changes in the plans and construction took place throughout the process of manufacture. Throughout the period of preparation of plans and process of fabrication, defendant's engineers including Mr. Muehle, the inventor of the process, were at plaintiff's plant supervising and directing the work. Each separate contract consisted of a written...
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