§ 203. Form of certificate required. The legislation adopted for the regulation of foreign corporations requires as a first step the filing with some State officer a certificate, containing a copy of the charter or articles of incorporation and other information about the business of the corporation, and designating an agent upon whom service of process may be had in all actions brought against the corporation. The form of certificate is usually prescribed in detail by the act, or a form is adopted by the State official having control; and it is in general sufficient to follow the prescribed form. In designating an agent it is not necessary to name him; it is enough to describe him. For instance, "the general manager" is sufficient designation of the person authorized to receive service of process.1 Where the "place of business" is to be stated, it is enough to state the city or town without pointing out the place more specifically; and if a "known place of business" is required it is sufficient that business is carried on in a place without concealment, so that the public may on enquiry ascertain the place, though the corporation does not itself convey information as to its place of business to everyone.3 § 204. What is doing business: single act. Doing a single and isolated act of business is not "doing" or "carrying on" business within the language of the statutes. Some continuous prosecution of business must at least be contemplated. "The obvious construction, therefore, of the Constitution and the statute is, that no foreign corporation shall begin any business in the State with the purpose of pursuing or carrying it on, until it has filed a certificate. . . . To require such a certificate as a prerequisite to the doing of a single act of business when there was no purpose to do any other 1 Goodwin v. Colorado M. I. Co., 110 U. S. 1, 28 L. ed. 47. 3 New England M. S. Co. v. Ingram, 91 Ala. 337, 9 So. 140. business or have a place of business in the State, would be unreasonable and incongruous." 4 6 8 10 On this principle the following acts have been held not to constitute doing business on the part of a foreign corporation: making a contract; 5 making a sale; making an occasional purchase; making a policy of insurance; taking a mortgage for a present consideration, or to secure a past due debt; or taking other security, such as a note, for a past debt,11 or on a settlement of account; 12 collecting a debt, as a premium on an insurance policy; 13 purchasing a promissory note; purchasing and holding 15 or renting 16 land; purchasing at an 14 4 Woods, J., in Cooper Manufacturing Co. v. Ferguson, 113 U. S. 727, 735, 28 L. ed. 1137. Acc. Sigel-Campion L. S. C. Co. v. Haston, (Kan.) 75 Pac. 1028. 5 Cooper Mfg. Co. v. Ferguson, 113 U. S. 727, 28 L. ed. 1137; Empire Milling & Mining Co. v. Tombstone Mill. & Mining Co., 100 Fed. 910; Babbit v. Field, (Ariz.) 52 Pac. 775; Hogan v. City of St. Louis, (Mo.) 75 S. W. 604; Henry v. Simanton, 64 N. J. Eq. 572, 54 Atl. 153 (semble); Nat'l Knitting Co. v. Bronner, 45 N. Y. S. 714, 20 Misc. 125; Com. v. Standard Oil Co., 101 Pa. 119; Kilgore v. Smith, 122 Pa. 48, 15 Atl. 698; Milan Milling & Mfg. Co. v. Gorten, 93 Tenn. 590, 27 S. W. 971, 26 L. R. A. 135; Davis & Rankin Bldg. & Mfg. Co. v. Caigle, (Tenn. Ch. App.) 53 S. W. 240. 6 Colo. Iron Works v. Sierra Grande Min. Co., 15 Colo. 499, 25 Pac. 325, 22 A. S. R. 433; Gates Iron Works v. Cohen, 7 Colo. App. 341, 43 Pac. 667; D. & H. Canal Co. v. Mahlenbrock, 63 N. J. L. 281, 43 Atl. 978; Blakeslee Mfg. Co. v. Hilton, 18 Pa. Co. Ct. 553. 7 Good Hope Co. v. Railway Barb Fencing Co., 22 Fed. 635; St. Louis Wire Mill Co. v. Consol. Barb Wire Co., 32 Fed. 802; Colorado Iron-Works Sierra Grande Min. Co., 15 Colo. 499, 25 Pac. 325, 22 A. S. R. 433. v. 8 Tabor v. Goss & P. Mfg. Co., 11 Colo. 419, 18 Pac. 537. Clews v. Woodstock Iron Co., 44 Fed. 31; Gilchrist v. Helena H. S. & S. R. R., 47 Fed. 593; New York & S. C. Co. v. Winton, (Pa.) 57 Atl. 955; Keene Guar. Sav. Bank v. Lawrence, 32 Wash. 572, 73 Pac. 680. 10 Florsheim Bros. D. G. Co. v. Lester, 60 Ark. 120, 29 S. W. 34, 27 L. R. A. 505, 46 A. S. R. 162. 11 Fuller & Johnson Mfg. Co. v. Foster, 4 Dak. 329, 30 N. W. 166; Creteau v. Foote & Thorne G. Co., 40 App. Div. 215, 57 N. Y. S. 1103; Security Co. v. Panhandle Nat. Bank, 93 Tex. 575, 57 S. W. 22. 12 New Jersey S. T. Co. v. Riehl, 9 Pa. Super. Ct. 22). 13 Frawley v. Pennsylvania C. Co., 124 Fed. 259. 14 Commercial Bank v. Sherman, 28 Ore. 573, 43 Pac. 658, 52 A. S. R. 811. 15 Lakeview Land Co. v. San Antonio T. Co., 95 Tex. 252, 66 S. W. 766. 16 Missouri C. & M. Co. v. Ladd, 160 Mo. 435, 61 S. W. 191. execution sale land 17 or personalty; 18 sending temporarily into the State a general agent to appoint local agents. 19 § 205. Continuous business action. Where, however, the foreign corporation enters upon a continuous line of business it is doing business within the State. Thus it is carrying on business to operate a factory under contract, supplying a superintendent; 20 to maintain an office for directors' meetings, at which all dividends are declared; 21 to become a special partner in a limited partnership within the State, contributing to its capital; 22 to procure or manufacture outside the State and deliver under contract within the State, for a period of several months, large quantities of ice; 23 to hold land for educational purposes; 24 to lease land for pasturing cattle; 25 to act as trustee; 26 to collect by resident agent premiums on policies formerly issued to residents of the State, though no policies are now issued; 27 to operate, by lease or otherwise, alone or jointly with the owner, a domestic railroad.28 17 Meddis v. Kenney, (Mo.) 75 S. W. 633. 18 Crook v. Girard I. & M. Co., 87 Md. 138, 39 Atl. 94, 67 A. S. R. 325. 19 D. S. Morgan & Co. v. White, 101 Ind. 413. 20 Diamond Glue Co. v. United States Glue Co., 187 U. S. 611, 47 L. ed. 328. 21 Peo. v. Horn Silver Mining Co., 105 N. Y. 76, 11 N. E. 155. 22 Peo. v. Roberts, 152 N. Y. 59, 46 N. E. 161, 36 L. R. A. 756 (affirming 11 App. Div. 310); Com. v. Standard Oil Co., 101 Pa. 119. 23 West Jersey I. M. Co. v. Armour, 12 Pa. Super Ct. 443. 24 Santa Clara Female Academy v. Sullivan, 116 Ill. 375, 6 N. E. 183, 56 A. R. 776. 25 Texas & P. Ry. v. Davis, (Tex. Civ. App.) 54 S. W. 381. 26 Pennsylvania Co. v. Bauerle, 143 Ill. 459, 33 N. E. 166; Farmers' L. & T. Co. v. Lake Street E. R. R., 173 Ill. 439, 51 N. E. 55. 27 Connecticut M. L. I. Co. v. Spratley, 172 U. S. 602, 43 L. ed. 569; Price v. St. Louis M. L. Ins. Co., 3 Mo. App. 262; Smyth v. International L. Assur. Co., 35 How. Pr. 126. 28 Erie Ry. v. Pennsylvania, 21 Wall. 492, 22 L. ed. 595; Van Dresser v. Oregon Ry. & N. Co., 48 Fed. 202; Norton v. Atchison, T. & S. F. R. R., 61 Fed. 618; Buie v. Chicago, R. I. & P. Ry., 95 Tex. 51, 65 S. W. 27, 55 L. R. A. 861. It is not essential for the application of this principle that several acts of business should already have been done; if a regular business is contemplated, the corporation has begun to carry on business when it does its first business act. "Although the record in each case discloses but one transaction of the corporation, that transaction was not merely incidental or casual. It was a part of the very business to perform which the corporation existed. It did distinctly indicate a purpose on the part of the corporation to engage in business within the state, and to make Kansas a part of its field of operation, where a substantial part of its ordinary traffic was to be carried on. Therefore, although a single act, it constituted a doing of business in the state within the meaning of the statute, while several acts of a different nature might not have had that effect." 29 Two New York cases, seemingly opposed to the current of authority, require explanation. In them a foreign corporation maintained an office in New York, at which the directors met and declared dividends. In one of the cases it was attempted to declare the corporation, a foreign railroad company, a bankrupt in New York, on the ground that it was there engaged in business; but the court held that the act did not confer jurisdiction unless the company actually carried on its business, i. e., operated its railroad, within the State.30 This is obviously a different question. In the other case it was attempted to tax the corporation on the money brought into the State to pay dividends; by the taxing act a foreign corporation doing business in the State was taxable on its capital therein invested, and the court, not passing on the question of doing business, held that there was no capital invested in New York.31 In both cases the corporation appears to have been doing business within the State.32 29 Mason, J., in John Deere Plow Co. v. Wyland, (Kan.) 76 Pac. 863. 30 In re Alabama & C. R. R., Fed. Cas. 124, 9 Blatch. 390. 31 Peo. v. Feitner, 77 App. Div. 189, 78 N. Y. S. 1017. 32 See also Doty v. Michigan C. R. R., 8 Abb. Pr. 427. 206. What is doing business: acting through agent. A foreign corporation can act only through an agent; and consequently if an ordinary agent is appointed by the company and permanently established in the State to carry on the business of the company, the company is doing business in the State. The clearest case of this sort is the appointment of a resident manager for a branch office; 33 but if the corporation maintains a resident agency, even if it does not amount to a branch establishment, the corporation is doing business, as when it appoints resident agents to solicit loans,34 or insurance, or to make sales, 35 or purchases of raw materials.36 On the other hand, where the corporation merely ships goods to a factor or commission merchant, who sells and accounts to the corporation, the corporation is not carrying on business where the sales are made.37 The factor is carrying on an independent business; the only business of the corporation is its dealing with the factor. Conversely, when the foreign corporation is acting as a mere agent for a domestic corporation, the latter corporation alone being really concerned in the matter, the foreign corporation is not doing business in the State. Thus where a foreign corporation procured a contract as promoter of a contemplated domestic corporation, and the latter was immediately formed and took over the contract, 33 Haggin v. Comptoir d'Escompte, 23 Q. B. Div. 519; Nutter v. Messageries Maritimes, 54 L. J. Q. B. 527; Bowden v. Imperial M. & T. Ins. Co., 2 New So. Wales St. Rep. (Law) 257. 34 United States Loan Co. v. Miller, (Tenn. Ch.) 47 S. W. 17. 35 Cone v. Tuscaloosa Mfg. Co., 76 Fed. 891; Fay Fruit Co. v. McKinney, (Mo. App.) 77 S. W. 160; Milsom R. & F. Co. v. Kelly, 10 Pa. Super. Ct. 565; First Nat. Bank v. Coughron, (Tenn. Ch.) 52 S. W. 1112. 36 Chicago M. & L. Co. v. Sims, 101 Mo. App. 569, 74 S. W. 128. 37 Bertha Zinc & Min. Co. v. Clute, 7 Misc. 123, 27 N. Y. S. 342; Hovey's Estate, 198 Pa. 385, 48 Atl. 311; Allen v. Buggy Co., 91 Tex. 22, 40 S. W. 393; Glanville v. J. B. Lippincott Co., 17 W. N. New So. Wales, 74 See to the same effect Dallas v. Atlantic, M. & O. R. R., 2 McAr. (Dist. Col.) 146 (sale of tickets of foreign road by domestic road; foreign road not doing business); United States v. American Bell Tel. Co., 29 Fed. 17 (license to domestic corporation by foreign corporation to use patented telephones; foreign corporation not doing business). |