United Mercantile Agencies v. Jackson
| Decision Date | 07 September 1943 |
| Docket Number | 38472 |
| Citation | 173 S.W.2d 881,351 Mo. 709 |
| Parties | United Mercantile Agencies, Appellant, v. James (Janes) W. Jackson and Thursa Jackson |
| Court | Missouri Supreme Court |
Appeal from Webster Circuit Court; Hon. C. H. Jackson Judge.
Reversed and remanded (with directions).
Haymes & Dickey and Haymes & Haymes for appellant.
(1) The acts and facts shown in evidence did not constitute the doing of business in Missouri by the appellant or prevent its maintenance of this action. None of the required standards is present. 17 Fletcher Cyc. Corporations (Perm. Ed.), secs 8464, 8466; Meir v. Crossley, 305 Mo. 206, 264 S.W 882; Meddis v. Kenney, infra. (2) Appellant was not required to comply with Secs. 5074 and 5077, Revised Statutes of Missouri, 1939, before bidding on and buying at auction the remaining assets of the failed Citizens Bank, and no act of it before or after such purchase required, for its validity, compliance with said statutes. Hogan v. St. Louis, 176 Mo. 149, 75 S.W. 604; Wulfing v. Cork Co., 250 Mo. 723, 157 S.W. 615; Frazier v. Rockport, 199 Mo.App. 80, 202 S.W. 266. (3) Said Secs. 5074 and 5077 do not prevent the acquisition of property in Missouri by an unlicensed foreign corporation and by such lawful bid and purchase the title to the note sued on vested in the plaintiff. Mergenthaler Linotype Co. v. Hays, 182 Mo.App. 113, 168 S.W. 239; Meddis v. Kenney, 176 Mo. 200, 75 S.W. 633; 28 Am. Jur., p. 188; 20 C. J. S., sec. 1875, p. 96; 17 Fletcher Cyc., Corporations (Perm. Ed.), sec. 8485. (4) Appellant was entitled to bring and maintain suits upon said notes, to collect or compromise them and to have and use attorneys and agents in Missouri for those purposes and such acts did not constitute "doing business." Heinrich Chemical Co. v. Welch, 300 S.W. 1001; Columbia Weighing Machine Co. v. Rockwell, 38 S.W.2d 508; United Shoe Machinery Co. v. Ramlose, 231 Mo. 508, 132 S.W. 1133; Meddis v. Kenney, supra; 17 Fletcher Cyc. Corporations (Perm. Ed.), secs. 8471, 8492; 20 C. J. S., secs. 1835, 1836, pp. 51, 52. (5) The purchase at auction of said remaining assets on one bid was a single or isolated transaction not amounting to the doing of business. State ex rel. v. Public Service Comm., 335 Mo. 448, 73 S.W.2d 393; Parker v. Wear, 230 S.W. 75; Shields v. Chapman, 240 S.W. 505; Mergenthaler Linotype Co. v. Hays, supra; Meddis v. Kenney, supra; 12 R. C. L., sec. 48, p. 69; State v. Shell Pipe Line Corp., 345 Mo. 1245, 139 S.W.2d 510; 20 C. J. S., sec. 1830, p. 48. (6) On the facts and acts stipulated and shown in evidence the appellant was entitled to judgment and the court should have sustained appellant's motion therefor. United Shoe Machinery Co. v. Ramlose, supra; Columbia Weighing Machine Co. v. Rockwell, supra; Heinrich Chemical Co. v. Welch, supra; North American Mortgage Co. v. Hudson, 168 So. 79; Shields v. Chapman, supra. (7) The facts and acts in evidence showed and constituted a fully executed transaction and the defendants are not in position to object to the maintenance of this suit against them by the plaintiff; and the court erred in not so finding and holding. Handlin-Buck Mfg. Co. v. Wendelkin Const. Co., 124 Mo.App. 349, 101 S.W. 702; 14a C. J. 1305; Parker v. Wear, supra; Good Roads Mach. Co. v. Broadway Bank, 267 S.W. 40; 17 Fletcher Cyc. Corporations (Perm. Ed.), sec. 8527. (8) The respondents had the burden of proving that the appellant was doing business in Missouri and not entitled to maintain this action. They failed entirely to discharge that burden and the judgment of the court is wholly without evidence to support it. Shields v. Chapman, supra; Heinrich Chem. Co. v. Welch, supra; 18 Fletcher Cyc. Corporations (Perm. Ed.), sec. 8630.
J. P. Smith, John C. Pope and Seth V. Conrad for respondents.
(1) The law is well settled that a foreign corporation doing business in this State without first complying with the statutes, cannot maintain an action in the courts of this State upon a contract growing out of the business so transacted. Heinrich Chemical Co. v. Welch, 300 S.W. 1001. (2) Corporations organized for pecuniary gain are required to take out a license to do business in the State. Orange Distributors v. Black, 221 Mo.App. 493. (3) Power of the State to impose conditions on foreign corporations doing business therein, is as extensive as its power over domestic corporations. Weed v. Bank Saving Life Ins. Co., 24 S.W.2d 653. (4) The transaction of business in this State by a foreign corporation, which has not complied with the conditions prescribed by the statutes, is unlawful and contrary to state policy, and every contract in furtherance of such business is void. Parke Davis & Co. v. Mullett, 245 Mo. 168. (5) Foreign corporations not licensed to do business in the State of Missouri, may perform an isolated transaction in the State without being guilty under the law, if such transaction is outside of the business for which said corporation was organized and incorporated. Missouri Coal & Mining Co. v. Ladd, 160 Mo. 435; Tri-State Amusement Co. v. Amusement Co., 192 Mo. 404; State v. Shell Pipe Line Co., 345 Mo. 1245, 139 S.W. 410. (6) A foreign corporation is prohibited by our statutes from engaging in any form of banking business, and any securities or promissory notes so discounted, become void and uncollectible. Secs. 5030, 5074, 5345, 7890, 7949, 7990, 8024, 8069, R. S. 1939.
Van Osdol, C. Bradley and Dalton, CC., concur.
This cause, an action on a promissory note, has been certified and transferred to this court under the provisions of Section 6, Amendment of 1884, Article VI of the Constitution of Missouri. (See United Mercantile Agencies v. Jackson (Mo. App.), 166 S.W.2d 807.) The judgment was for defendants, and plaintiff has appealed.
The petition alleges that defendants executed and delivered their promissory note, dated November 13, 1933, payable to the Citizens Bank of Marshfield, or order, in the principal sum of $ 2000, due six months after date, bearing interest compounded annually at the rate of 8% per annum, payable semiannually, with all costs of collection, including a 10% attorney's fee, if not paid at maturity. It is further alleged that the payee "endorsed the same in writing across the back thereof and delivered and transferred the same to the plaintiff for value, whereby plaintiff became and is the owner and holder . . ."
The answer contains a general denial and pleads affirmatively that plaintiff, a corporation organized for profit under the laws of the State of Kentucky, cannot maintain the action for the reason that it has violated the provisions of Section 5077, R. S. 1939, Mo. R. S. A. sec. 5077, and has not complied with the provisions of Section 5074, R. S. 1939, Mo. R. S. A., sec. 5074. The answer further alleges that plaintiff purchased the note, together with the notes of many other persons, from a domestic banking corporation; and that, by so purchasing and discounting the notes, plaintiff engaged in the banking business in violation of certain sections of the statutes of the State of Missouri relating to banks and banking.
The reply admits that the plaintiff is a corporation organized under the laws of the State of Kentucky, denies that plaintiff engaged in business in Missouri, and denies the allegations of the answer other than the tacit admission therein of defendant's execution of the note.
It is stipulated by the parties that the note was executed by defendants; that plaintiff is a corporation organized for pecuniary profit under the law of the State of Kentucky, has never had any office or place for the transacting of its business in Missouri and has not been licensed to do or transact business as a foreign corporation in this state; that on October 29, 1940, plaintiff bought the note, and many other notes and some judgments, "all included in one bid," at public auction from the Commissioner of Finance for the State of Missouri who was at the time of the sale in charge of the business and affairs of the Citizens Bank of Marshfield then in process of liquidation; that the total face value of the assets so purchased was $ 140,000, for which plaintiff bid and paid $ 2207; that after the purchase plaintiff sent two representatives to Webster County for the purpose of collecting the notes and judgments; that the representatives took lodging at a hotel in Marshfield for several weeks, "contacted a large number of persons owing," including defendants, collecting or compromising some of the obligations; that thereafter plaintiff placed many of the remaining notes and judgments in the hands of attorneys authorized to collect, compromise or commence action -- some of the obligations have been compromised, and several actions have been brought some of which are now pending.
Among the specific purposes for the incorporation of plaintiff, as provided by an amendment to its Articles of Incorporation, are ". . . buying, selling, leasing, managing, possessing, or otherwise dealing in real estate, stocks, bonds, or property of any kind; and to do all things incident and necessary to any or all of the foregoing enumerated activities."
Defendants do not direct our attention to the basis of their contention that, under the facts stipulated, the plaintiff has engaged in the banking business in this state. The sole question for consideration herein is -- did plaintiff "do" or "transact" business in the State of Missouri within the meaning of the provisions of Sections 5074 and 5077, R. S. 1939, Mo. R. S. A., secs. 5074 and 5077.
Section 5074 provides that ...
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