transaction is unlawful, that is to say, so far void that the courts of the state will refuse to aid the offending corporation; and will refuse, also, to aid the other party,-unless so doing would make the statute operate against the persons it was intended to protect,-as for example, one who deals with a foreign corporation having a place of business in the state, in ignorance of the fact that it has not complied with the law. In this view, there is nothing to prevent a recovery on such contracts anywhere except in the courts applying the law of the state whose statute has been violated.1

§ 172. Illegal regulations. In Orient Insurance Co. v. Daggs, 172 U. S. 557, the rule is broadly stated: "That which a state may do with corporations of its own creation it may do with foreign corporations admitted into the state." Of course the right to repeal, amend or forfeit the charter of a corporation is confined to the creating state; but the case is a good illustration of the general rule. The appellant was a corporation of Connecticut, and the appellee was a citizen of Missouri who had taken out, in that state, insurance on his property situated there. The policy provided. that the company should not be liable beyond the actual cash value of the property at the time the loss occurred, and that its liability should in no case exceed the cost of replacing the property, after deducting an allowance for depreciation. A statute of Missouri, passed before the policy was issued, provided that in all suits upon insurance policies thereafter brought, the defendant should not be permitted to deny that the property insured was worth the full amount for which it was insured. The court held that this was an obligation

1 Allen v. Alleghany Company, 196 U. S. 458; Kendrick v. Warren Bros. Co., 110 Md. 47. And see case note, 40 L. R. A. (N. S.)

which the state could lawfully impose upon its own corporations and that the appellant was bound by it.1

It would seem logical to say that the right to exclude from the state includes the right to regulate a foreign corporation which has entered. But the principle is not so broad.

Constitutional guaranties. Being for the purposes of federal procedure a citizen of the creating state, a corporation sued in any other state has, where the jurisdictional amount is involved, the right of removal to the federal court. Accordingly, a statute which requires an agreement not to remove as a condition of admission, is, to that extent, unavailing. But, on the other hand, if the corporation is one which the state has the power to exclude, it may revoke a permission previously given; and the fact that such revocation is based upon the exercise of the right of removal makes no difference; where a right exists, the motive leading to its exercise is immaterial. Again, in Blake v. McClung, 172 U. S. 239, a statute of Tennessee imposed upon certain classes of corporations the condition that their assets, in the event of insolvency, should be first applied to the claims of resident creditors. A corporation of the class designated by the statute became insolvent, and among its non-resident creditors were citizens of Ohio and a corporation of Virginia. The court held that as to the former, the condition was void, because it violated the clause of the Constitution giving to the citizens of each state all the privileges and immunities of the citizens of the several states. As against the Virginia

1 So in Dayton Coal & Iron Co. v. Barton, 183 U. S. 23, the appellant was held bound by a state statute requiring the redemption of "store orders" in money,-the statute having been held valid as to domestic corporations.

2 Security Insurance Co. v. Prewitt, 202 U. S. 246,-in which all the earlier cases are reviewed and one of them is qualified.

corporation, the statute was upheld on the ground: (1) that it was not a citizen within the meaning of the constitutional provision quoted; and (2) that although a "person" within the meaning of the Fourteenth Amendment, it was not doing business in Tennessee and therefore not within the language of the Amendment declaring "that no state shall deny to any person within its jurisdiction the equal protection of the laws."

Again, a foreign corporation, after lawful entry into a state, is a person entitled to the equal protection of the laws with domestic corporations. There is a conflict when this principle meets the right of exclusion established by Prewitt's case (supra); and the latter yields.1

1 Western Union T. Co. v. Kansas, 216 U. S. 1; Southern R. Co. v. Greene, 216 U. S. 400; Herndon v. Chicago &c. R. Co., 218 U. S. 135; and see the earlier case of American Smelting Co. v. Colorado, 204 U. S. 103, in which a foreign corporation successfully asserted that the law in force at the time of its admission constituted a contract against higher taxation than was imposed upon domestic corporations of the same character. The statement in the text is made on the basis of Justice White's concurring opinion in West. Union Co. v. Kansas, supra, rather than on the difference between the business of insurance and interstate commerce emphasized in the opinion of the Court. See Baltic Mining Co. v. Mass., 231 U. S. 68, in which a moderate excise tax measured by the authorized capital of a foreign corporation, was upheld.

$173. Status when admitted. A corporation lawfully doing business in another state is a "person within its jurisdiction" under the Fourteenth Amendment. It carries its charter with it, and within the limitations of the charter, it has the rights and is subject to the restrictions of a domestic corporation of a similar character; 2 but, unless it be a national corporation, it cannot exercise within the state any special privilege,-such as the right of eminent domain.* It is entitled to free access to the state courts, but may, like other non-residents, be required to give security for costs. It remains a non-resident, so far as the operation of local insolvency laws is concerned, and a debt due it by a resident debtor will not be discharged by insolvency proceedings in which it does not participate.5

It is provided by statute in Maryland that "No foreign corporation shall engage or continue in any kind of business in this state, the transaction of which by domestic

1 Relfe v. Rundle, 103 U. S. 222; Canada R. R. v. Gebhard, 109 U. S. 527.

2 There is a difference of opinion as fo the status of a corporation formed by the citizens of one state under the laws of another, for the purpose of doing business in the state of their residence. At one extreme are cases denying individual immunity from corporate debts to the persons operating under such charter.-Duke v. Taylor, 37 Fla. 64, 31 L. R. A. 484. The other and prevailing view is that such a proceeding is not necessarily a fraud upon the law of the non-creating state-Demarest v. Flack, 128 N. Y. 205; and see the cases collected in 13 Am. & Eng. Ency. of Law (2d Ed.) page 846.

3 Luxton v. North River Bridge Co., 153 U. S. 529.

4 3 Clark & Marshall, Corp. sec. 854.

5 Hammond Co. v. Best, 91 Me. 431, 42 L. R. A. 528-and for cases where the charter powers of a foreign corporation exceed those conferred upon domestic ones,-see 3 Clark & Marshall, Corp. secs. 840 and 841.

corporations is not permitted by the laws thereof. And every foreign corporation doing business in this state shall be deemed to have assented to all the provisions of the laws thereof."1

§ 174. Suits and process. We have seen that unless it lawfully may be, and in fact has been excluded, and subject, in every case, to the imposition of a rule security for costs, a foreign corporation has the same right of resort to the state courts that a domestic corporation has, Where, however, the proposed suit is against a foreign corporation, important questions arise: Where may it be sued; and upon whom may process lawfully be served? It is important to remember that these questions are distinct. The court may have jurisdiction of the suit, but the writ of summons may be properly quashed because the person upon whom it was served did not sufficiently represent the corporation for that purpose. So, a plea to the jurisdiction may be available where no question could be made about the representative character of the agent served with process. With these distinctions in view, a summary will be given of the general doctrine; then, a brief account of the federal and Maryland law.

First. General principles. (1) A corporation which transacts no business in the state is not amenable to suit there. This is one of the surviving applications of the territorial theory promulgated in Bank of Augusta v. Earle. The theory has no application to a non-resident

1 Act of 1908, Code 1911, Art. 23, sec. 91; Patapsco Elec. Co. v. Baltimore, 110 Md. 306; Hannis Distilling Co. v. Baltimore, 114 Md. 678.

213 Peters 519; and see Conley v. Mathieson Alkali Works, 190 U. S. 406.