Toledo Tie & Lumber Co v. Thomas

• Decision Date: 22 March 1890
• Citation: 33 W.Va. 566,11 S.E. 37
• Court: West Virginia Supreme Court
• Parties: Toledo Tie & Lumber Co. v. Thomas et al.

11 S.E. 37

33 W.Va. 566

Toledo Tie & Lumber Co.

v.Thomas et al.

Supreme Court of Appeals of West Virginia.

March 22, 1890.

Equity Pleading — Abatement — Foreign Corporations—Penalties—Injunction.

1. Where the defendant in an equity suit files a plea in abatement in proper form, and at the proper time, and at the same time files his answer formally pleading the same matters therein, and 6aid answer is duly sworn to, the said matter in abatement will be treated as properly put in issue, although the said plea is not sworn to.

2. A contract made by a foreign corporation before it has complied with the statutory prerequisites to the right to do business in another state will not on that account be held absolutely void, unless the statute expressly so declares; and, if the statute imposes a penalty upon the corporation for failing to comply with such prerequisites, such penalty will be deemed exclusive of any others.

3. Our statute, (section 30, c. 54, Code,) which prescribes that foreign corporations shall comply with certain regulations as a prerequisite to their right to hold property or do business in this state, and fixes a penalty for their failure to do so, does not make the contracts made in this state by such corporations before compliance with said regulations absolutely void and unenforceable in the courts of this state.

4. A cause in which it is held that the court did not err in overruling a preliminary motion to dissolve an injunction made before the final hearing of the cause on its merits.

(Syllabus by the Court.)

Appeal from circuit court, Mason county; Guthrie, Judge.

Simpson & Howard, Gunn & Gibbons, and Simpson & Thomas, for appellant.

Tomlinson & Wiley and Kenna & Chilton, for appellees.

Snyder, P. On November 21, 1888, the Toledo Tie & Lumber Co. entered into a written contract with W. W. Thomas for the purchase of 75, 000 ties, at the price of 32 cents per tie for all first-class ties, and 12 cents per tie for all second-class ties, to be delivered at Point Pleasant, in this state, on board the cars, by June 1, 1889, or as soon thereafter as the rises in the streams will permit; and, further, the said company agreed to advance to said Thomas 18 cents per tie on all first-class and 5 cents per tie on all second-class, ties, when such ties shall have been inspected and branded on the banks of Eighteen-Mile creek, in Putnam county, W. Va.; and said company shall have the right to take possession of all ties so inspected and branded on which it has made such advances, wherever they may be found, in case the said Thomas fails to deliver the same. It is also agreed that the 18 cents per tie advanced as aforesaid shall be considered full payment for said ties when so inspected; and the said Thomas binds himself to raft and deliver said ties on the cars at Point Pleasant, as aforesaid, and he shall there be paid the additional sum of 14 cents per tie on first-class, and 7 cents per tie on second-class, ties. Under this contract Thomas commenced getting out and delivering ties, but before completing his part of the contract he became financially embarrassed, and by deed dated July 10, 1889, he assigned to J. C. Thomas and Rufus Switzer, trustees, for the benefit of his creditors, all his choses in action, and the benefit of all contracts which he had with any person whomsoever. A few days after said assignment, to-wit, on July 15, 1889, the said Toledo Tie & Lumber Co. presented to the judge of the circuit court of Mason county their bill against the said W. W. Thomas, and said J. C. Thomas and Rufus Switzer, trustees, and obtained from said judge an injunction restraining and inhibiting the said defendant from stopping or interfering with the said company in loading and shipping said ties. At the August rules, 1889, the plaintiff filed its bill, with the injunction thereon, as aforesaid, in the said Mason county circuit court, and at the same rules the defendants filed thereto two special pleas, a general demurrer, and their answers to the plaintiff's bill. The plaintiff demurred to each of said special pleas, and the cause was, on August 13, 1889, heard on the said pleading, depositions, and the motion of the defendants to dissolve the injunction, and the court sustained the demurrers to said pleas, and overruled the motion to dissolve the injunction, and from this order the defendants J. C. Thomas and Rufus Switzer, trustees, have appealed to this court.

It is insisted that the court erred in not dismissing the bill for want of jurisdiction. The defendant's first special plea avers that the supposed cause of action alleged in the bill did not, nor did any part thereof, arise in the county of Mason; that the same arose within the county of Putnam, in this state; and that at the time of issuing the writ in this suit the defendant resided, and still resides, in Putnam county. This plea is not sworn to, and is therefore not good as a plea in abatement. But the defendants, at the same rules at which the plaintiff filed its bill, filed their answers, in which they formally plead and rely upon the same matters alleged in the said first special plea, and the answer is sworn to in due form. I think, therefore, taking this plea and answer together, the defendants were entitled to an abatement of the suit, provided the facts alleged are sufficient for that purpose, and said facts should be proved. Our statute (sections 1, 2, c. 123, Code 1887) provides that suits of the classto which this suit belongs shall be brought either in the county wherein any of the defendants reside, or wherein the cause of action, or any part thereof, arose. The defendants, as we have seen, plead that none of them reside in Mason county, and that no part of the cause of action arose in said county; but, on thecontrary, they all reside in the county of Putnam, and every part of the cause of action arose in said county; therefore, if these allegations be true, the express mandate of the statute is that this suit should have been brought in Putnam county, and, per sequence, it was improperly brought in the county of Mason.

The appellants further insist that the court erred in sustaining the demurrer to the said second special plea. This plea, in effect, avers that the plaintiff is a foreign corporation, created and organized under the laws of the state of Ohio; that the contract alleged in the plaintiff's bill was made in Putnam county, in this state, and that from January 1, 1889, and continuously thereafter up to the time of the institution of this suit, the plaintiff, as such corporation, did transact divers other business in the counties of Putnam, Mason, and Kanawha, of this state, and that it did not, at that time, or at any time before the institution of this suit, comply with any of the raquirements of section 30 of chapter 54, Code 1887, of this state; and therefore the defendants pray that the suit be abated. This plea raises the important question of the true interpretation of said statute. Among other provisions, the said statute declares, in substance, that any corporation created by the laws of any...