Williams v. Campbell Soup Co.

• Decision Date: 01 December 1948
• Docket Number: No. 5350.,5350.
• Citation: 80 F. Supp. 865
• Parties: WILLIAMS v. CAMPBELL SOUP CO. et al.
• Court: U.S. District Court — Western District of Missouri

80 F. Supp. 865

WILLIAMS v. CAMPBELL SOUP CO. et al.

No. 5350.

United States District Court W. D. Missouri, W. D.

November 9, 1948.

Supplemental Opinion December 1, 1948.

Irving Achtenberg, of Kansas City, Mo., for plaintiff.

Gossett, Ellis, Dietrich & Tyler, of Kansas City, Mo., for defendants.

REEVES, Chief Judge.

A proper consideration of this case requires a statement of the averments contained in the first amended petition. It is alleged that both the corporate defendants are nonresidents of Missouri and,

"That defendants and each of them maintain a joint business office in the Business Men's Assurance Bldg. in Kansas City, Missouri; that C. Frank Coen of Kansas City, Missouri, is a managing or general agent of defendant Campbell Soup Company and of defendant Campbell Sales Company and is the person in charge of the joint business office of defendants aforesaid."

It is then averred:

"That defendants, and each of them, are engaged in the general business of manufacturing, canning, selling and distributing to retail trade, to be resold to the public, a variety of canned soups, * * *."

This is followed by an averment that the plaintiff, "on or about October 24, 1947," consumed a quantity of soup taken from a can of "Campbell's Cream of Mushroom Soup," and that she was made seriously ill from the ingestion of such soup. And there is an averment that in preparing said soup for consumption the defendants were apprized of its possible wide distribution and "knew and intended that it should be consumed by the public, and thereby warranted and represented said soup as being a pure, harmless, wholesome and safe food, etc."

The first named defendant, Campbell Soup Company, seeks to quash the service upon the ground that it was not doing business in the State of Missouri, so as to be liable for service of process on foreign corporations, and the last named codefendant, the Campbell Sales Company, says that no cause of action is stated against it.

These will be examined.

The affidavits appended to the motion of the defendant Campbell Soup Company show that C. Frank Coen resides in Kansas City, Missouri, and that he has been employed for the past seventeen years by the Campbell Sales Company "as a district sales manager." He then deposes that the office in Kansas City is maintained by him at his own personal expense and that neither of the corporate defendants has or maintains an office or offices in Kansas City, Missouri.

The affidavit of Alois B. Heilig, who resides at Wallingford, Pennsylvania, states that he is treasurer of Campbell Soup Company with headquarters at its general offices in Camden, New Jersey; "that all of the orders for Campbell Soup Company's products that are received by Campbell Soup Company are received outside the State of Missouri and are either accepted or rejected outside the State of Missouri. * * * 7. That all shipments made to customers in Missouri originate from points outside Missouri, the terms of shipment in each case being such that title to each shipment passes to the Missouri customer at point of shipment outside Missouri (f. o. b. point of shipment, freight prepaid)."

By paragraph 10 of said affidavit it is stated:

"Campbell Sales Company solicits orders for Campbell Soup Company's products and forwards all such orders to Campbell Soup Company at its offices outside of Missouri."

By paragraph 11 of said affidavit it is stated:

"Campbell Sales Company is not authorized to make any sales or enter into any contracts on behalf of Campbell Soup Company."

1. It appears from the foregoing that, whereas the plaintiff has not alleged in her complaint that Campbell Sales Company is an agent of Campbell Soup Company, yet the defendant, by the affidavit of Alois B. Heilig, so states. It does appear from the petition, as well as from the affidavits, that C. Frank Coen is an employee and agent of Campbell Sales Company. Service of process in the case was had at the offices of the said C. Frank Coen by serving the required papers upon him and the returns of the serving officer contain recitals that such service was had "at a business office of the within named defendant corporation Campbell Sales Company, a corp.," and there was a further recital that the Campbell Soup Company was served "by leaving with Frank Coen, Manager for the Campbell Sales Company, a corporation" one writ and petition as required by statute. Mo.R. S.A. § 847.27(c).

As indicated, it appears that as a fact, notwithstanding the averments of the complaint, the Campbell Sales Company was a soliciting agent for Campbell Soup Company. If, therefore, it was doing business within the State of Missouri, the service upon the managing agent of the Sales Company would be service upon Campbell Soup Company. It is the law that a general sales agent, as apparently the said Coen was in this case, is a "managing agent" within the purview of the statute. See Jackson v. Schuylkill Silk Mills, 92 Misc. 442, 156 N.Y.S. 219, loc. cit. 221.

2. Under the law one corporation may be an agent for another. 19 C.J.S., Corporations, § 952, p. 398. Such relation, however, does not necessarily exist because one corporation owns all of the shares of its stock or because the two corporations have common stockholders. See Commerce Trust Co. v. Woodbury, 8 Cir., 77 F.2d 478; Pacific Can Co. v. Hewes, 9 Cir., 95 F.2d 42. It is unnecessary to discuss this question, however, for the reason that the defendants admit by the affidavits above mentioned that the Campbell Sales Company was in fact a sales agent for Campbell Soup Company.

3. The next question is whether the operations mentioned in the affidavits submitted by the defendants would be sufficient to bring the two corporate defendants within the State of Missouri so as to make them subject to the service statute. The Supreme Court of the United States had before it an almost identical question in International Harvester Co. v. Kentucky, 234 U.S. 579, 34 S.Ct. 944, 58 L.Ed. 1479. The plaintiff in error in that case operated under a contract, or, rather, under general instructions to its agents which comport in almost complete precision with the facts in this case. Such instructions were set out on page 584 of 234 U.S., on page 945 of 34 S.Ct., 58 L.Ed. 1479. In that case all contracts of sale, not only would be made outside the state, but, "must be made f. o. b. from some point outside of Kentucky, and the goods become the property of the purchaser when they are delivered to the carrier outside of the state." Notwithstanding this studied effort on the part of the defendant, as in the present case, to keep the company beyond the reach of process servers in the State of Kentucky, the Supreme Court upheld service upon a local agent. The court concluded the opinion (234 U.S. loc. cit. 589, 34 S.Ct. loc. cit. 947, 58 L.Ed. 1479) as follows:

"We are satisfied that the presence of a corporation within a state necessary to the service of process is shown when it appears that the corporation is there carrying on business in such sense as to manifest its presence within the state, although the business transacted may be entirely interstate in its character. In other words, this fact alone does not render the corporation immune from the ordinary process of the courts of the state."

See also St. Louis Southwestern Ry. Co. v. Alexander, 227 U.S. 218, 33 S.Ct. 245, 57 L.Ed. 486, Ann.Cas.1915B, 77. The law appears to have been well stated in Williams v. Bruce's Juices, D.C., 35 F.Supp. 847.

Upon the affidavits and other facts appearing without dispute, the defendant Campbell Soup Company was distributing its product in Missouri. The very fact that the deponent, C. Frank Coen, was an employee of the Sales Company and its agent, and the very fact that the Sales Company, according to the affidavits, was engaged in soliciting business for the Soup Company was enough to show an agency of the Sales Company for the Soup Company although not so alleged in the complaint. Since it was the agent of the Soup Company and since C. Frank Coen was its managing agent, then, if within the state, service of process upon him would be sufficient for both companies....