State ex rel. Borden Co. v. Dammann

• Decision Date: 05 March 1929
• Citation: 198 Wis. 265,224 N.W. 139
• Parties: STATE EX REL. BORDEN CO. v. DAMMANN, SECRETARY OF STATE.
• Court: Wisconsin Supreme Court

198 Wis. 265

224 N.W. 139

STATE EX REL. BORDEN CO.

v.DAMMANN, SECRETARY OF STATE.

Supreme Court of Wisconsin.

March 5, 1929.

Appeal from an order of the Circuit Court for Dane County; Hon. A. G. Zimmerman, Judge.

Mandamus by the State of Wisconsin, on the relation of the Borden Company, against Theodore Dammann, Secretary of State of the State of Wisconsin. From order denying defendant's motion to quash alternative writ, defendant appeals. Affirmed.--[By Editorial Staff.]

Appeal from an order of the circuit court for Dane county. Hon. A. G. Zimmerman, judge, denying defendant's motion to quash an alternative writ of mandamus.

The relator, the Borden Company, is a foreign corporation, organized and existing under the laws of the state of New Jersey, and has been licensed to transact and has transacted business in the state of Wisconsin since the year 1912, and during such period it has become the owner of valuable real estate and personal property in this state, and has built up an extensive trade and good will. In 1926 its authorized capital stock was increased from $30,000,000 to $50,000,000, and it has paid into the state the license fees upon such authorized capital stock, required under the statutes of the state, notwithstanding it had issued only $47,179,600 of the amount of the capital stock authorized. In 1928 the authorized capital stock of the company was increased from $50,000,000 to $100,000,000, and, pursuant to section 226.02 (5) of the Statutes, it offered to file a certified copy of such amendment, and complied in all respects with the requirements of the statutes, with the exception that it paid no additional license fee, for the reason that only $47,179,600 of its capital stock had been issued and was outstanding.

In paragraph 11 of the petition for a writ of mandamus, addressed to the circuit court for Dane county, Wis., the petitioner alleges:

Sec. 226.02, Wisconsin Statutes 1927, makes it the duty of the e defendant to file said certified copy of said amendment to petitioner's certificate of incorporation. Defendant's failure so to do is without warrant or authority in the law and imperils petitioner's right and license to transact business in Wisconsin and if continued petitioner's said license will be forfeited and petitioner will suffer great and irreparable loss and injury. Petitioner has no adequate or sufficient remedy other than that obtainable by a writ of mandamus by this court. Wherefore petitioner prays judgment that a peremptory writ of mandamus issue out of this court commanding the defendant, Theodore Dammann, Secretary of State of the State of Wisconsin, to file the certified copy of the amendment to petitioner's certificate of incorporation presented to him on April 13, 1928, and to file same as of said date. * * *”

The court then issued its alternative writ of mandamus, and the defendant appeared and moved to quash such writ, for the reason that the petitioner does not state facts showing that it is entitled to the relief prayed for. After the hearing of the issues thus raised, the lower court entered an order denying defendant's motion, from which ruling the defendant has prosecuted this appeal.John W. Reynolds, Atty. Gen., and T. L. McIntosh and Adeline J. Meyer, Asst. Attys. Gen., for appellant.

Olin & Butler and Byron H. Stebbins, all of Madison, for respondent.

DOERFLER, J.

Section 226.02 (formerly section 1770b), Statutes, provides in part as follows:

“(2) No corporation, incorporated or organized otherwise than under the laws of this state, * * * shall transact business or acquire, hold, or dispose of property in this state until such corporation shall have caused to be filed in the office of the secretary of state a copy of its charter, articles of association or incorporation and all amendments thereto. * * *

(3) Such corporation * * * shall make and forward to the secretary of state, with the articles of association or incorporation above provided for, a statement duly sworn to, stating: * * *

(h) That such corporation as a condition of its being permitted to begin or continue doing business within this state, shall comply with all the laws of the state with regard to foreign corporations.

(4) Such corporation shall pay into the office of the secretary of state, upon filing its articles of association or incorporation, a fee of twenty-five dollars, and one dollar for every one thousand dollars of its capital stock exceeding twenty-five thousand dollars employed or to be employed in this state, as shown by its sworn statement.

(5) All amendments to the articles of association or incorporation made subsequent to the first filing with the secretary of state shall be certified to and filed in the same manner as the articles of association or incorporation, and shall be so filed within thirty days after the same have been filed with the secretary of state or other proper officer of the state wherein the corporation is organized. For filing such amendment the corporation shall pay to the secretary of state a fee of ten dollars except in case of amendment increasing capital stock, in which case the fee for filing shall be in addition to ten dollars, one dollar for each additional one thousand dollars of the increased capital stock to be used in this state, as shown by a sworn statement to be filed with the amendment increasing the capital stock, which said statement shall be signed by the president, secretary, treasurer or general manager of the corporation, and shall state the proportion of the increased capital stock to be represented in this state. * * * In case of failure to file amendment, as above stated, the corporation shall pay to the secretary of state, on filing said amendment, a penalty of twenty-five dollars.

(6) * * *

(7) Every foreign corporation which has heretofore filed with the secretary of state a copy of its charter or articles of association or incorporation or which shall hereafter file the same as required by this act, and every foreign corporation transacting business in this state shall annually, between the first day of January and the first day of April, file with the secretary of state a report sworn to by the president, secretary, treasurer or general manager of the corporation, as of the first day of January, which shall state:

(a) * * *

(b) * * *

(c) * * *

(d) * * *

(e) The proportion of the authorized capital stock represented in the state of Wisconsin by its property located and business transacted therein during the preceding year. In determining the proportion of authorized capital stock employed in the state, the same shall be computed by taking the gross business in dollars of the corporation in the state and add the same to the full value in dollars of the property of the corporation located in the state. The sum so obtained shall be the numerator of a fraction of which the denominator shall consist of the total gross business in dollars of the corporation, both within and without the state, added to the full value in dollars of the entire property of the corporation, both within and without the state. The fraction so obtained shall represent the proportion of the authorized capital stock represented within the state. The secretary of state may demand, as a condition precedent to the filing of such report, such further figures, information and statements as he may deem proper in order to determine the accuracy of the reports submitted; the additional information so obtained shall not become a matter of record in the department of state. The corporation shall pay a fee of two dollars for filing such report. In case said report shows that said corporation employs in this state a proportion of its authorized capital stock in excess of twenty-five thousand dollars, said corporation shall pay to the secretary of state, at the time of the filing of said report, an additional fee of one dollar for each one thousand dollars of such excess, except that the said corporation shall receive a credit for the proportion of its authorized capital stock already paid for in excess of twenty-five thousand dollars.

(f) That such corporation as a condition of its being permitted to begin or continue doing business within this state, shall comply with all the laws of the state with regard to foreign corporations. * * *”

In 1919 the section which is now 226.02 (7) (e), Statutes, was known as section 1770b (7) (e), and in that year the latter was amended by chapter 485 of the laws of 1919, so that wherever the words “capital stock” were used they were preceded with the word “authorized.” The sole issue, therefore, presented in this case, consists of whether said amendment is constitutional.

[1] Plaintiff argues that chapter 485 of the Laws of 1919 is unconstitutional, first, because it offends against the equal protection clause of the Fourteenth Amendment of the Federal Constitution; second, because it is repugnant to the commerce clause of the Federal Constitution; and, third, because it operates to tax property beyond the territorial jurisdiction of the state, it violates the due process clause of the Fourteenth Amendment. The issues thus raised are based upon alleged violations of the provisions of the Federal Constitution, and if the Supreme Court of the United States had determined such issues on principle, then it becomes the duty of this court to recognize the law as so established, and to abide thereby, regardless of whether our individual views may or may not coincide with those expressed by the high federal court.

[2][3] At the outset it may be conceded that corporations are not citizens of the United States, in the sense in which that term is used in section 1 of the Fourteenth Amendment of the Federal Constitution, where it is said: “No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States.” The term “citizen” as so used contemplates natural born citizens...