Pulson v. American Rolling Mill Co.
| Decision Date | 29 October 1948 |
| Docket Number | No. 4359.,4359. |
| Citation | 170 F.2d 193 |
| Parties | PULSON et al. v. AMERICAN ROLLING MILL CO. |
| Court | U.S. Court of Appeals — First Circuit |
Hugh F. Blunt, of Brockton, Mass., for appellants.
Hugh D. McLellan, of Boston, Mass. (Henry V. Atherton, of Boston, Mass., on the brief), for appellee
Before MAGRUDER, Chief Judge, and GOODRICH (by special assignment), and WOODBURY, Circuit Judges.
The plaintiff, a resident of Massachusetts, sues the defendant, an Ohio corporation, in the federal court for the District of Massachusetts on a claim for breach of warranty in goods sold by the defendant to the plaintiff. The situs of the transaction itself does not appear. The defendant objects to the jurisdiction of the court, claiming it is not subject to suit in Massachusetts. The plaintiff's suit was commenced by the service of summons both upon the Massachusetts Commissioner of Corporations and Taxation and upon Frank R. Wright, an employee of the defendant in Massachusetts. It was found as a fact by the District Court that the defendant "has no representatives here except persons who solicit offers from Massachusetts prospects looking to transactions which are completed by contracts made in Ohio and shipments of goods made from points outside of Massachusetts to Massachusetts in interstate commerce." It was also found that defendant has no local bank accounts, makes no collections or local deliveries, and that its sole business in Massachusetts is in connection with the solicitation of orders which are transmitted to points outside the state.
This case is brought solely on diversity grounds in a federal court sitting in Massachusetts. Rule 4(d) (7) of the Federal Rules of Civil Procedure, 28 U.S.C.A., provides that service of process on a foreign corporation is valid if made in the manner prescribed by any statute of the United States or in the manner prescribed by the law of the state in which the service is made. There being no federal statute applicable, and service having been attempted under Massachusetts procedure, the case is governed by the requirements for valid service in that state.
There are two parts to the question whether a foreign corporation can be held subject to suit within a state. The first is a question of state law: has the state provided for bringing the foreign corporation into its courts under the circumstances of the case presented? There is nothing to compel a state to exercise jurisdiction over a foreign corporation unless it chooses to do so, and the extent to which it so chooses is a matter for the law of the state as made by its legislature.1 If the state has purported to exercise jurisdiction over the foreign corporation, then the question may arise whether such attempt violates the due process clause or the interstate commerce clause of the federal constitution. Const. art. 1, § 8, cl. 3; Amend 14. This is a federal question and, of course, the state authorities are not controlling. But it is a question which is not reached for decision until it is found that the State statute is broad enough to assert jurisdiction over the defendant in a particular situation.
Service upon foreign corporations in Massachusetts is covered by two chapters of the General Laws.2 The legislative language is very broad but the statute as applied by the Supreme Judicial Court of Massachusetts has expressly been limited not to cover the case of a foreign corporation which is engaged solely in the solicitation of interstate business within the state. Thurman v. Chicago, Milwaukee & St. Paul Ry. Co., 1926, 254 Mass. 569, 151 N.E. 63, 46 A.L.R. 563. This view of the Massachusetts statute was followed by this Court in Ladd v. Brickley, 1 Cir., 1946, 158 F.2d 212. Nothing shown at this argument indicates that our conception of the Massachusetts decisions was incorrect. Indeed, we have made an independent check to be sure on this point and our conclusion is that the law of Massachusetts now stands as declared by the Massachusetts Court in the cases cited and followed by us in Ladd v. Brickley.3
Only one other point requires discussion. The Massachusetts Court in giving a somewhat limited effect to the legislative language in the Thurman case did indicate that a reason for doing so was the fear of unconstitutionality if the statute was applied as broadly as its language might indicate it should be applied. It now develops from the Supreme Court's decision in International Shoe Company v. State of Washington, 1945, 326 U.S. 310, 66 S.Ct. 154...
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