Thurman v. the Chicago, Milwaukee and St. Paul Railway Co.

• Decision Date: 25 February 1926
• Citation: 254 Mass. 569
• Parties: JAMES THURMAN v. THE CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

254 Mass. 569

JAMES THURMAN v. THE CHICAGO, MILWAUKEE AND ST. PAUL RAILWAY COMPANY.

Supreme Judicial Court of Massachusetts, Suffolk.

February 25, 1926

October 21, 22 1925.

Present: RUGG, C.

J., BRALEY, CROSBY CARROLL, & SANDERSON, JJ.

Corporation Foreign: service of process. Practice, Civil, Service of process. Constitutional Law, Interstate commerce, Due process of law.

Mere solicitation by a foreign corporation in this Commonwealth of business in interstate commerce outside this Commonwealth, does not constitute such doing of business here as in itself warrants the inference of liability to service of process.

A foreign railroad corporation, which is engaged in interstate commerce wholly outside this Commonwealth, which does not own, operate nor control any railroad within this Commonwealth and has never done any business within this Commonwealth except to maintain an office in Boston solely for the solicitation of interstate freight and passenger traffic to be transported over its railroad without this Commonwealth, was named as a defendant in an action in the Superior Court based upon a cause which related to the carriage of goods in interstate commerce outside the Commonwealth under a contract of carriage not made, solicited, nor in any part performed in the Commonwealth. Purporting to act under

G.L.c. 223, Section 38, the plaintiff caused service of process to be made upon one who never had been an agent of the defendant for any purpose except that he occupied the solicitation office of the defendant in Boston and was engaged solely in the solicitation for the defendant of freight and passenger traffic for transportation in interstate commerce over its railroad exclusively outside the Commonwealth. The defendant had no other agent within the Commonwealth. The defendant filed an answer in abatement to which the plaintiff demurred. Held, that

(1) The only kind of business done by the defendant in the Commonwealth namely, solicitation of interstate business to be performed outside the Commonwealth, did not subject it, apart from statute, to jurisdiction for service of process;

(2) So far as the defendant did business within the Commonwealth, that business was exclusively interstate business with respect to which the Commonwealth could impose no conditions as prerequisite to its transaction;

(3) If the statute in question were construed as intending to make the service of process above described effectual, it would be unconstitutional as violating the requirements of the Federal

Constitution as to due process of law; (4) The statute must be construed as not intending to make the service above described effectual;

(5) The service above described did not make the defendant subject to the process of the court.

To assume jurisdiction over a person against his protest where no jurisdiction exists is denial of due process of law.

If a statute admits of two constructions, the effect of one being to render the statute unconstitutional and of the other to establish its validity, the courts will adopt the latter construction.

CONTRACT OR TORT for the loss of a carload of rags delivered by the plaintiff to the defendant in Minneapolis in the State of Minnesota for shipment to Chicago in the State of Illinois and later with the assent of the defendant, ordered to be delivered directly to Pencoyd Station in the State of Pennsylvania. Writ dated January 2, 1925.

The defendant filed an answer in abatement setting forth the ground described in the opinion. The plaintiff demurred to the answer. The demurrer was heard by Sisk, J., and was sustained; and, being of opinion that such ruling on the demurrer to the answer ought to be determined by this court before further proceedings in the action, he reported the action to this court for that purpose.

A.M. Hillman, for the plaintiff. W.L. Parsons, for the defendant.

RUGG, C.J. This action is brought by a resident of Massachusetts against a defendant described in the writ as a corporation having a usual place of business in the city of Boston in our county of Suffolk. The return of the officer shows that service was made upon F.D. Dodge, "agent" of the defendant and "in charge of its business." The defendant filed an answer in abatement, to which the plaintiff demurred. The facts well pleaded in the plea must be accepted as true for the purpose of this decision. Those facts, so far as material, are that the defendant is a foreign railroad corporation engaged in interstate commerce wholly outside this Commonwealth and that it does not own, operate, or control any railroad within this Commonwealth, and that it has never done any business within this Commonwealth except that it maintains an office in the city of Boston solely for the solicitation of interstate freight and passenger traffic to be transported over its railroad without this Commonwealth; that the person, upon whom service was made, was not and never has been an agent of the defendant for any purpose except that he occupies the solicitation office of the defendant in Boston and is engaged solely in the solicitation for the defendant of freight and passenger traffic for transportation in interstate commerce over its railroad exclusively outside this Commonwealth, and that it has no other agent within the Commonwealth, and that the cause of action alleged in the plaintiff's writ and declaration relates to the carriage of goods in interstate commerce outside the Commonwealth and did not arise in this Commonwealth, and that the contract of carriage out of which it arose was not made, solicited, or in any part performed in this Commonwealth.

It is provided by G.L.c. 223, Section 38, that "In an action against a foreign corporation . . ., which has a usual place of business in the Commonwealth, or, with or without such usual place of business, is engaged in or soliciting business in the Commonwealth, permanently or temporarily, service may be made" as was made in the case at bar.

It is contended under these circumstances that both under the statute and apart from the statute the attempted service on the defendant was not due process of law, and that to require the defendant to submit to this action would unreasonably obstruct and unduly burden interstate commerce contrary to rights guaranteed to it under the Constitution of the United States. These contentions depend for their soundness upon the interpretation of the Federal Constitution, as to which adjudications of the Supreme Court of the United States constitute the sole guide and final decision. But these contentions arise in litigation before this court and we must express our conclusions concerning them.

It was said in Reynolds v. Missouri, Kansas & Texas Railway, 224 Mass. 379, 386: "The mere solicitation of business by a foreign corporation without more commonly has been held not to be the doing of business within a State."

When the validity of service of process upon a foreign corporation has depended upon a statute providing for service of process upon such corporations doing business within the State where the action is brought, or upon the doing of business within such State of such nature and extent as, apart from statute, to give jurisdiction under general principles of constitutional law, it has been held that solicitation of business are not such doing of business. Mere solicitors of business are not regarded as agents of the corporation in the sense required for jurisdictional purposes. Decisions supporting these general propositions are numerous. Green v. Chicago, Burlington & Quincy Railway, 205 U.S. 530, 533. International Harvester Co. of America v. Kentucky, 234 U.S. 579, 586, 587. Minnesota Commercial Men's Association v. Benn, 261 U.S. 140, 145. W.S. Tyler Co. v. Ludlow-Saylor Wire Co. 236 U.S. 723. Atchison, Topeka & Santa Fe Railway v. Wells, 265 U.S. 101. Davis v. Farmers Co-operative Equity Co. 262 U.S. 312. Decisions of State courts are to the same effect. Berger v. Pennsylvania Railroad, 27 R.I. 583. Booz v. Texas & Pacific Railway, 250 Ill. 376, 381. Arrow Lumber & Shingle Co. v. Union Pacific Railroad, 53 Wash. 629. Banks Grocery Co. v. Kelley-Clarke Co. 146 Tenn. 579. Gamble-Robinson Co. v. Pennsylvania Railroad, 157 Minn. 306. Vicksburg, Shreveport & Pacific Railway v. DeBow, 148 Ga. 738. Saxony Mills v. Wagner, 94 Miss. 233.

Respecting the question, when a foreign corporation is doing business within a jurisdiction other than that of its domicil, it was said in People's Tobacco Co. Ltd. v. American Tobacco Co. 246 U.S. 79, at page 87: "The general rule deducible from all our decisions is that the business must be of such nature and character as to warrant the inference that the corporation has subjected itself to the local jurisdiction, and is by its duly authorized officers or agents present within the State or district where service is attempted." The same statement in substance occurs in St. Louis Southwestern Railway Co. of Texas v. Alexander, 227 U.S. 218, 227.

It seems clear to us that, in the absence of any statute, the acts of the defendant within this Commonwealth were not of such nature as to render it subject to the jurisdiction of...