Roberts v. Evans Case Co.
| Decision Date | 02 February 1955 |
| Docket Number | No. 11281.,11281. |
| Parties | Phyllis ROBERTS, also known as Mrs. B. Roberts, Plaintiff-Appellant, v. EVANS CASE CO., Defendant-Appellee. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Arthur S. Gomberg, Samuel Nineberg, Chicago, Ill., for appellant.
Harry L. Kinser, T. I. McKnight, McKnight, McLaughlin & Dunn, Chicago, Ill., for appellee.
Before DUFFY, Chief Judge, and FINNEGAN and LINDLEY, Circuit Judges.
In the District Court plaintiff sought to recover from defendant damages claimed to have resulted from an allegedly defective cigarette lighter manufactured by defendant, but purchased from Sears, Roebuck & Company, in Chicago. The summons was served upon "E. H. Gordon, Salesman and Agent of said Corporation." Defendant moved to quash the service on two grounds: first, that it is a Massachusetts corporation not doing business in Illinois; and, second, that Gordon was not its agent but was employed by one Hendricks, sales agent for defendant. The District Court allowed the motion and dismissed the suit. Thereupon plaintiff perfected this appeal.
The facts as they appear of record follow. Hendricks is a sales representative of defendant for Illinois and certain other territory, having held this position for some twenty years. Defendant is incorporated under the laws of Massachusetts and has its factory and principal place of business in North Attleboro in that state. Its only office in Illinois is a sales office at 55 East Washington Street, Chicago, which is leased to defendant, who reimburses itself for the rent by deducting it from the commissions earned by Hendricks. In the office are Hendricks and two people employed by him, the salesman Gordon, and the stenographer. Hendricks is the only sales representative of defendant in Illinois, and defendant has no employees or representatives in Illinois except him. The office is maintained and conducted for the sole purpose of soliciting orders to be sent to Massachusetts. None of defendant's products is manufactured in Illinois, and none of its contracts of sale made there. Defendant is not licensed to do business as a foreign corporation in Illinois, and has not authorized any agent to accept service of process there. Hendricks solicits sales of defendant's products but makes no contracts of any sort on behalf of defendant. Such purchase orders as he obtains are forwarded to defendant in Massachusetts and there accepted or rejected by it. All shipments are made f. o. b. the factory. The company maintains no stock of wares in Illinois, but supplies Hendricks with samples and catalogs for his use in solicitation, all of which are prepared in Massachusetts and sent to him only to aid him in procurance of orders. He is not paid a salary, but receives compensation in the form of commissions, based on purchase orders procured by him and sent to defendant and accepted by it. All checks issued by defendant in connection with the sales office are drawn on a bank in North Attleboro. Defendant has no property in Illinois, other than the office furniture, samples and catalogs used in the solicitation of orders; it has paid a State tax on this personal property. Gordon, upon whom process was served, is not employed by defendant, but is an employee only of Hendricks and has no authority to accept service of process for defendant. Defendant is listed in the Chicago telephone directories.
Upon these facts Judge Sullivan held that defendant was not doing business in Illinois, and was not amenable to service of process in that state. His decision was impelled by the opinion of this court in Canvas Fabricators, Inc. v. William E. Hooper & Sons Co., 7 Cir., 1952, 199 F.2d 485, the facts in which were not greatly dissimilar to those here involved. There, too, the defendant had maintained an office in the city of Chicago for many years. Its name appeared on the office door and was listed in the telephone directory. It did something that the defendant in this case did not do, in that it maintained a bank account in Chicago. There, the sales agent used stationery and letterheads bearing the company name and the Chicago office address. No contracts were entered into in Illinois; all purchase orders were solicited by the sales agent and forwarded by him to the defendant at its Philadelphia office, where they were either accepted or rejected. Shipments were made f. o. b. the factory and there, as here, neither the sales agent nor any other person, had any authority to transact business in Illinois other than to solicit orders handled in the manner...
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