Ashland Lumber Co. v. Detroit Salt Co.

89 N.W. 904, 114 Wis. 66, 1902 Wisc. LEXIS 125

• Court: Wisconsin Supreme Court
• Decided: April 1, 1902
• Status: Published

Opinion

■Cassoday, C. J.

The plaintiff’s cause of action is based upon the guaranty of the defendants contained in-the contract, to the effect that the number of pieces of heading manufactured by the defendants, of the size therein mentioned, would, at pixty cents per 1,000 pieces, net the plaintiff $25 for each 200,000 feet of lumber manufactured by the plaintiff. To fulfill such guaranty, the plaintiff claims that the defendants were bound to pay for 41,667 pieces of heading for each and every 200,000 feet of lumber manufactured by the plaintiff. But such heading was to be manufactured from “slabs, edgings, and trimmings,” as they came from the plaintiff’s mill. True, as claimed by counsel for the plaintiff, the contract nowhere required the plaintiff to furnish “slabs, edgings, and trimmings” of dimensions and quality sufficient to enable the defendants to manufacture 41,667 pieces of heading for each and every 200,000 feet of lumber manufactured by the plaintiff; nor do we think any such agreement or guaranty is implied in the contract. In so far as the charge of the court is to that effect, we think it was erroneous. The simple agreement is that the plaintiff shall furnish “slabs, edgings, and trimmings as they came from” its mill, and the defendants were to take the same from the elevators. Counsel for the plaintiff, in his brief, concedes that the plaintiff agreed to furnish “slabs, edgings, and trimmings as they came from the mill, in the ordinary course of business, for stock for the defendants to make heading out of.” This is said by way of argument in construing the contract, and so we assume it relates to the time of making the contract.

In charging the jury in regard to the custom in Ashland “as to the methods and manner of slabbing logs,” they were told to consider such evidence, “especially as to the manner in which the plaintiff was slabbing its logs immediately before and at the time the contract was made between the parties to this contract”’ and that the plaintiff was “bound to furnish such material, of the same or similar character, dimensions, and quantities, in the ordinary course of business, as they had been and were manufacturing at the date of this written contract, May 10, 1899.” And the court further charged the jury that “the defendants had a right, under the contract, to assume that the plaintiff would not materially change its manner of slabbing its logs and trimming its lumber, although there is no express stipulation written in said contract that they should so continue.” We find no error in such portions of the charge, although inconsistent anti out of harmony with other portions of the charge above referred to. If, after making the contract, the plaintiff substantially changed its manner of slabbing its logs and trimming its lumber, so as to materially lessen the dimensions and quantity of such “slabs, edgings, and trimmings,” to the substantial damage of the defendants, then thereafter the defendants were relieved from carrying out their part of the contract by paying according to the terms of the guaranty, but would only be liable thereafter for what the material received by them was reasonably worth. Whether there was such change, and, if so, when, is a question of fact for the jury. The samé is true if the plaintiff failed to furnish the defendants piling room for drying purposes, dock room for shipping, or the necessary power in the mill for manufacturing such heading, as agreed in the contract. But until such failure to so furnish, or such change in the manner of slabbing and trimming, we perceive no reason why the plaintiff cannot recover according to the terms of the guaranty, and thereafter for what the material received by the defendants was reasonably worth.

2. Such being the true construction of the contract, we perceive no error in allowing the defendant Miller to testify to the effect that, prior to the signing of the contract, he went to the plaintiff's mill, and observed its operation, and made calculations as to the number of pieces of heading which could be realized from the slabs, edgings, and trimmings then coming from the mill, and then and there estimated the same at 43,000 pieces of heading from each 200,000 feet of lumber cut at the mill, and that the contract was made with reference to such conditions. . *

3. It is contended that the defendants were improperly allowed to take anything by their counterclaim, by reason of the failure of such Michigan corporations to comply with the statutes of this state (sec. 1770b, Stats. 1898, as amended by ck. 351, Laws of 1899). That section provides, among other things:

“No corporation . . . incorporated or organized otherwise than under the laws of this state . . . shall transact business or acquire, hold or dispose of property in this state until such . . . corporation shall have caused to be filed in the office of the secretary of state a duly authenticated copy of its charter . . . and all amendments thereto which may be made while it shall continue to do business therein. . . . Every contract made by or on behalf of any such . . . corporation . . . affecting the personal liability thereof or relating to property, within this state, before it shall have complied with the provisions of this section, s7iall be tuholly void on its behalf and on behalf of its assigns, but shall be enforceable against it or them.”

No question is made but that a duly authenticated copy of the charter of each of such corporations should have been filed with the-' secretary of this state before it attempted to “transact business or acquire, hold or dispose of property in this state,” and there is no claim that the case does not come within the provisions of the statute.

One contention on the part of the defendants is that the words “shall be wholly void,” in the last clause of the statute quoted, should be construed to mean simply voidable at the option of the plaintiff, and not absolutely void and a nullity. After careful consideration, this court has recently held that “where the statute provides that the act shall be void, and fixes a penalty for the perpetration of the prohibited act, the word ‘void’ should be interpreted as meaning void absolutely, in accordance with the technical accuracy of the word.” Land, L. & L. Co. v. McIntyre, 100 Wis. 245, 75 N. W. 964, and cases there cited. The section in question is highly penal. “The failure to comply with any” of its “provisions” subjects the corporation, “or any agent, officer or person acting’ for it in this state, to a penalty of $500” for the first violation, and $1,000 for any subsequent violation. We must hold that the words, “shall be wholly void on its behalf and on behalf of its assigns, but shall be enforceable against it and them,” mean just what they say; and, if they are valid, they render the contract in question absolutely void and a nullity, in so far as it is sought to be enforced on behalf of the defendants by way of counterclaim in this action.

Is the section a valid law ? In the leading case of Paul v. Virginia, 8 Wall. 168, 181, it was said by Mr. Justice Field, speaking for the whole court in regard to foreign corporations, that:

“Having no absolute right of recognition in other states, but depending for such recognition and enforcement of its contracts upon their assent, it follows, as a matter of course, that such assent may be granted upon such terms and condi-' tions as those states may think proper to impose. They may exclude the foreign corporation entirely, they may restrict its business to particular localities, or they may exact such security for the performance of its contracts with their citizens, as, in their judgment, will best promote the public interest. The whole matter rests in their discretion.”

This language was expressly sanctioned by the same learned court in Ducat v. Chicago, 10 Wall. 410; Liverpool Ins. Co. v. Massachusetts, 10 Wall. 566; and Philadelphia F. Asso. v. New York, 119 U. S. 117, 7 Sup. Ct. 108. Among the many more recent cases following in the same line are Ashley v. Ryan, 153 U. S. 436, 14 Sup. Ct. 865; Hooper v. California, 155 U. S. 648, 15 Sup. Ct. 207; New York State v. Roberts, 171 U. S. 658, 19 Sup. Ct. 58; Waters-Pierce Oil Co. v. Texas, 177 U. S. 28, 20 Sup. Ct. 518. In this last case it was held that “it is well settled that a state has the power to impose such conditions as it pleases upon foreign corporations seeking to do business within it.” This court has frequently sanctioned and followed the same rule. State ex rel. Drake v. Doyle, 40 Wis. 197, 198; State v. United States M. A. Asso. 67 Wis. 624, 31 N. W. 229; Larson v. Aultman & T. Co. 86 Wis. 284, 56 N. W. 915; Wyman v. Kimberly-Clark Co. 93 Wis. 559, 67 N. W. 932. No question of foreign or interstate commerce is Rere involved. We must hold that the statute in question is valid, however harsh its provisions may seem to be. The contract having been made and the business transacted by the defendants as copartners, the defendant Miller cannot, as an individual, take anything by the alleged counterclaim in favor of "the firm.

By the Court. — The judgment of the circuit court is wholly reversed on the plaintiff’s appeal, and the cause is remanded for a new trial. The defendants take nothing by their appeal.