Smolik v. Philadelphia & Reading Coal & Iron Co.
| Decision Date | 21 April 1915 |
| Citation | 222 F. 148 |
| Parties | SMOLIK v. PHILADELPHIA & READING COAL & IRON CO. TOBIAS v. SAME. |
| Court | U.S. District Court — Southern District of New York |
In each of these cases the defendant moves to set aside the service of process upon an agent designated by it to accept service as provided in section 16 of the General Corporation Law of the state of New York, and in section 432 of the New York Code of Civil Procedure. In one case the action was brought in the state court, and the defendant, appearing specially for the purpose of setting aside the service, removed it to this court. The other was originally brought in this court and the motion is made upon a special appearance only for this purpose. The ground of each motion is that the defendant is a Pennsylvania mining corporation, doing business, but having no part of its mines, in this state, and that the action arises from personal injuries suffered by the plaintiff in Pennsylvania while an employe of the defendant in its mines there situated.
Section 16 of the General Corporation Law of New York requires every corporation doing business in that state to take out a license, without which it cannot sue or defend in any action of contract, and is subject to other penalties. One condition of procuring such a license is the appointment of an agent within the state upon whom all process may be served. Such an agent the defendant did appoint, and service was made upon him as stated at the outset.
Pierre M. Brown, of New York City, for the motions.
Roderic Wellman, of New York City, for Tobias.
Martin T. Manton, of New York City, for Smolik.
LEARNED HAND, District Judge (after stating the facts as above).
In Simon v. Southern Railway, 236 U.S. 115, 35 Sup.Ct 255, 59 L.Ed. . . ., the Supreme Court decided that a court of Louisiana had not acquired jurisdiction under the following facts: The defendant was a railroad company organized in another state, having none of its railroad in Louisiana, but doing some business there. The statutes of Louisiana directed all foreign corporations doing business in the state to appoint an agent on whom process should be served, and provided that, if the corporation failed to make an appointment, service might be made upon the secretary of state. The defendant not having appointed any such agent Simon served his process on the assistant secretary of state in an action arising upon the tort of the defendant committed within the state of Alabama. The ground of the decision was that the implied consent of the corporation arising from its doing business within Louisiana must be limited to actions arising out of the business done within the state. The same rule was laid down in Old Wayne Life Association v. McDonough, 204 U.S. 8, 27 Sup.Ct. 236, 51 L.Ed. 345; the action there being in Pennsylvania upon a life insurance contract executed in Indiana by an Indiana corporation.
In Simon v. Southern Railway, supra, the court especially reserved from the decision a case, such as those at bar where a foreign corporation has complied with the state statute and appointed an agent upon whom process may be served. Such a case at first blush presents an apparent contradiction. Since 1839 (Bank of Augusta v. Earle, 13 Pet. 519, 10 L.Ed. 274) it has been the doctrine of the Supreme Court that a foreign corporation was a fictitious entity, which had no existence outside of the territory of the sovereign which created it. All its act elsewhere must be viewed as those of an absent principal, acting through an authorized agent. It resulted that personal jurisdiction could arise only when some agent had been appointed who was expressly authorized to appear or to accept service for the absent principal. St. Clair v. Cox, 106 U.S. 350, 1 Sup.Ct. 354, 27 L.Ed. 222. Otherwise, the foreign state must proceed in rem against the property of the...
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