Interstate Realty Co. v. Woods

168 F.2d 701, 1948 U.S. App. LEXIS 2098
CourtCourt of Appeals for the Fifth Circuit
DecidedJune 18, 1948
DocketNo. 12259
StatusPublished
Cited by4 cases

This text of 168 F.2d 701 (Interstate Realty Co. v. Woods) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Interstate Realty Co. v. Woods, 168 F.2d 701, 1948 U.S. App. LEXIS 2098 (5th Cir. 1948).

Opinion

LEE, Circuit Judge.

This suit was filed by the appellant, a Tennessee corporation, to recover from appellee, a resident of Mississippi, a broker’s commission alleged to be due on the sale of certain of appellee’s real estate in the State of Mississippi. Appellee in his answer denied the right of appellant to recover, setting up that appellant was a foreign corporation which, because it had' never qualified to do business in the State of Mississippi as provided by Mississippi law,1 was not entitled to maintain any suit in any court in Mississippi. After filing his answer, the appellee called upon appellant to admit, pursuant to Federal Rules of Civil Procedure, Rule 36, 28 U.S.C.A. following section 723c, that it had not qualified to do business in Mississippi. In response, appellant denied that it was doing business in Mississippi, but admitted a number of transactions in that State over a specified period of years. Upon this admission, the court below, on motion for summary judgment, found that appellant was doing business in Mississippi and held that the contract in question was void. Judgment was thereupon entered dismissing the plaintiff’s suit with prejudice. This appeal followed.

[702]*702The two questions involved are (1) Was appellant doing business in Mississippi within the purview of the statutes? And, (2) if so, was the contract w'ith appellee which was entered into in Mississippi null and void because appellant at that time had not qualified to do business in Mississippi?

The record shows that appellant is a corporation organized under the laws of the State of Tennessee, with its domicile in Memphis, Tenn., and that it had never qualified to do business in Mississippi. Through its agents, however, it had contracted to sell real estate in Mississippi and in connection with sales had sent its agents into Mississippi to meet prospective buyers and to show the properties to be-sold. Appellant admitted that in 1942 it earned from 3 sales in Mississippi $2,121.45; in 1943, from 2 sales, $4,064.25; in 1944, from 3 sales, $12,000; in 1945, from 14 sales, $14,272.27; and in 1946, from 16 sales, $14,430.75. We think that in view of these admissions the court below was correct in holding that appellant was doing business in Mississippi within the meaning of the Mississippi statutes. Marx & Bensdorf, Inc. v. First Joint Stock Land Bank of New Orleans, 178 Miss. 345, 173 So. 297; Wiley Electric Co. v. Electric Storage Battery Co., 167 Miss. 842, 147 So. 773.

The question remaining is whether or not appellant’s failure to qualify to do business in Mississippi struck with nullity the contract sued upon in this case. The pertinent sections of the Mississippi law are set forth in the margin.2

The court below rested its decision upon Quartette Music Co. v. Haygood, 108 Miss. 755, 67 So. 211, 212, and held that under that case the contract here sued upon was null and void because at the time of contracting the appellant had not qualified to do business in the State of Mississippi. In so holding we think the court erred.

[703]*703In the Haygood case the plaintiff was a Texas corporation and brought suit in the Circuit Court of Lee County, Miss., against J. L. Haygood and G. W. Long on a promissory note signed by them in the sum of $225. The defendant moved to dismiss, setting foith that the plaintiff was a foreign corporation and had not qualified to do business in Mississippi and that the note sued upon was the consideration for business done by the corporation in Mississippi. Plaintiff demurred to the plea on the ground that the law referred to was un- ■ constitutional and that the plea did not state sufficient grounds for a dismissal. The trial court overruled the demurrer and dismissed the plaintiff’s suit, and the plaintiff appealed. The Supreme Court affirmed and, citing an earlier Mississippi case said:

“ 'Every contract made for, or about, any matter or thing which is prohibited and made unlawful by any statute, is a void contract, though the statute itself does not mention that it shall be so, but only inflicts a penalty on the defaulter, because a penalty implies a prohibition, though there are no prohibitory words in the statute.’
“There are some decisions in our books which apparently conflict with this rule, but they were all overruled by Woodson v. Hopkins, 85 Miss. 171, 37 So. 1000, 38 So. 298, 70 L.R.A. 645, 107 Am.St.Rep. 275.”

The latest case called to our attention from the Mississippi Supreme Court on the subject is Newell Contracting Co. v. State Highway Commission, 195 Miss. 395, 15 So.2d 700, 702. There the court said: “We are of the opinion that the court below was correct in holding that the appellant was doing business in this state and that there had been no substantial compliance with the statutes here involved until September 16, 1933, and that hence the contract sued on is void and unenforcible. Quartette Music Co. v. Haygood, 108 Miss. 755, 67 So. 211; Peterman Construction & Supply Co. v. Blumenfeld, 156 Miss. 55, 125 So. 548; Wiley Electric Co. v. Electric Storage Battery Co., 167 Miss. 842, 147 So. 773; Marx & Bensdorf, Inc. v. First Joint Stock Land Bank of New Orleans, 178 Miss. 345, 173 So. 297; Case v. Mills Novelty Co., 187 Miss. 673, 193 So. 625, 126 A.L.R. 1102.” (Emphasis ours.)

Whether the court in using the word “void” meant absolutely null, or void in the sense of unenforceable, the opinion does not make clear. Citation of the Play-good case would indicate that the court was of the opinion that the contract was absolutely null; but citation of the other cases, all of them opinions by the Supreme Court of Mississippi later in date than the Haygood case, would indicate that the court meant that the contract was “void” only in the sense that it was unenforceable3 in the Mississippi courts.

In Peterman Construction & Supply Co. v. Blumenfeld, supra, the Supreme Court of Mississippi said [156 Miss. 55, 125 So. 550]:

“ * * * we think the case is controlled by Quartette Music Co. v. Haygood, supra, in which it is said that a contract made without first complying with the provisions of the above quoted statute could not be enforced in the courts of this state.
“That is the policy of this state, and while this case appears to be hard, in that finally the foreign corporation did comply with the law, yet in so far as it affects this contract the compliance cannot be made to relate back to the date of its execution. It was either enforceable on the date of its execution, or unenforceable. Under the statute, as construed by this court, the contract was not enforceable on its execution, and when the one contract was signed it was, in effect, a volume of business already transacted amounting to 200 separate and distinct contracts, in so far as the relation created between the foreign corporation and the several subscribers is concerned. * * * ”

In Wiley Electric Co. v. Electric Storage Battery Co., supra, the Supreme Court of [704]*704Mississippi said [167 Miss. 842, 147 So. 777]: “ * * * This statute closes the doors of the courts of this state to foreign •corporations doing business in this state in violation of its provisions, consequently upon the proof in this record we think the suit should have been dismissed.”

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Applied Technologies Associates, Inc. v. Schmidt
362 F. Supp. 1103 (D. New Mexico, 1973)
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337 U.S. 535 (Supreme Court, 1949)
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172 F.2d 188 (Seventh Circuit, 1949)

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168 F.2d 701, 1948 U.S. App. LEXIS 2098, Counsel Stack Legal Research, https://law.counselstack.com/opinion/interstate-realty-co-v-woods-ca5-1948.