Kentucky Finance Corp. v. Paramount Auto Exchange Corp.

178 N.W. 9, 171 Wis. 586, 1920 Wisc. LEXIS 167
CourtWisconsin Supreme Court
DecidedJune 1, 1920
StatusPublished
Cited by10 cases

This text of 178 N.W. 9 (Kentucky Finance Corp. v. Paramount Auto Exchange Corp.) is published on Counsel Stack Legal Research, covering Wisconsin Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kentucky Finance Corp. v. Paramount Auto Exchange Corp., 178 N.W. 9, 171 Wis. 586, 1920 Wisc. LEXIS 167 (Wis. 1920).

Opinion

Eschweiler, J.

Defendant justifies the order requiring plaintiff’s secretary, a resident of Louisville in the state of Kentucky, under the laws of which state the plaintiff corporation was organized and doing business, to appear for examination 'at Milwaukee and to produce plaintiff’s books and papers, as being a proper exercise of the power vested in the trial court under the provisions of sub. 7, sec. 4096, Stats., which reads as follows:

“In case a foreign corporation is a party, the examination of its president, secretary, other principal officer, assignor or agent or employee, or the person who was such, or either of them, at the time of the occurrence of the facts made the subject of the examination, may be had under the provisions of this section in any county of this state. The court may also, upon motion and such terms as may be just, fix a time and place in this state for such examination of any of said persons. Such persons so sought to be examined as aforesaid shall attend at such time and place and submit to the examination, and then and there have with him all papers, books, files, records, things, and matters in the possession of such person by reason of his relation to such corporation, relevant to the controversy. Such person sought to be examined as aforesaid shall attend at such time and place and [590]*590submit to the examination, and, if required, attend for the purpose of reading and signing such deposition, without service of subpoena.”

The second order appealed from, which struck out plaintiff’s complaint and dismissed his action for default in compliance with the preceding order, is claimed to be'justified under the provisions of sub. 2, sec. 4097, Stats., which reads as follows:

“2. If any officer, agent, or employee, or any person who was such officer, agent, or employee of a foreign corporation, at the time of the occurrence of the facts made the subject of the examination, be lawfulfy required to appear and testify, as provided in this chapter, either within or without the state, shall neglect or refuse so to do; or, if such person, when lawfully required, shall refuse and neglect to have with hina any papers, books, files, records, things, and matters in the possession of such party relevant to the controversy, such party may be punished as for a contempt and in the discretion of the court, the pleading of such foreign corporation stricken out, and judgment givent against it as upon default or failure of proof.”

Plaintiff contends, first, that the said orders constituted an abuse of judicial discretion; and secondly, that each of the statutes above quoted is unconstitutional in that they violate the Fifth and Fourteenth amendments to the United States constitution.

The first objection is not insisted upon in this court, the parties being desirous of having a determination upon the second point.

The plaintiff cannot rely upon a claim that any such right as here asserted is secured to it under the Fifth amendment to the United States constitution. The first ten amendments to the United States constitution do not apply to state governments but only to the federal government itself. Minnesota & St. L. R. Co. v. Bombolis, 241 U. S. 211, 217, 36 Sup. Ct. 595.

[591]*591The clause in the Fourteenth amendment to the federal constitution invoked by appellant on this appeal, reads, so far as material here, as follows:

'“No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.”

Appellant’s contention is mainly directed to one proposition, and that is to the effect that there is no constitutional power within the circuit court to strike out plaintiff’s complaint and dismiss its action for a default on its part to comply or cause a compliance with an order which directs a nonresident individual, as officer of a nonresident corporation, to appear and submit to an examination and bring its records and papers within the jurisdiction of the state wherein such foreign corporation has commenced an action in such state court against a resident of such state. That to strike out the complaint and dismiss the action is in effect to deny such nonresident corporation the right to prosecute such action, and in effect denies it equal protection under the law and denies it equality to so litigate on the same footing as may Wisconsin residents, and therefore denies plaintiff the equality guaranteed to it by the federal constitution.

Statutory provisions have long been established in this state, and this court has upheld them, granting power to the circuit court by the striking out of pleadings and directing the entry of an appropriate judgment thereafter for defaults by such party in complying with some statutory duty or some order of such court. Under sub. 1 of the same sec. 4097, Stats., here involved, authority is given to strike out the pleading of a party individual, either within or without the state, for a refusal to appear and testify. That such power might be properly exercised in the court’s discretion does not seem to have been questioned or doubted in what was [592]*592said by this court in Eastern R. Co. v. Tuteur, 127 Wis. 382, 410, 105 N. W. 1067. Sec. 3072, Stats., provides for a dismissal of an action where proper proceedings are not taken within the time limited after the determination of an appeal to this court. State ex rel. Mitchell v. Johnson, 105 Wis. 90, 80 N. W. 1104. Sec. 2811a provides for the dismissal of pending actions in which there has been delay in bringing the cause to trial. Pereles v. Christensen, 164 Wis. 163, 159 N. W. 817. Sec. 4064 authorizes the striking out of the'pleading of a party who fails to attend as a witness when duly subpoenaed; and sec. 2664 permits such striking out for failure to file the same within a specified time, the validity of which was apparently unquestioned in Evans v. Rector, 107 Wis. 286, 289, 83 N. W. 292.

The provision here enforced is certainly no more drastic than in the above instances or than when the same result is arrived at, so repeatedly upheld by this court, in denying to a nonresident corporation which has failed to comply with the provisions of sec. 1770& the right to even cross the threshold of our courts in attempting to enforce, as against a resident here, a contract made within this state.

Similar remedies have been enforced in other jurisdictions. Gross v. Clark, 87 N. Y. 272, 273; Larimore v. Bobb, 114 Mo. 446, 21 S. W. 922; French v. Central C. Co. 76 Ohio St. 509, 81 N. E. 751; Conrad, Schopp F. Co. v. Bondurant, 134 Ky. 568, 121 S. W. 482.

The remedy here.invoked must therefore be considered as a well recognized and established method of legal procedure in the courts of this state, binding on all litigants subject to the jurisdiction of such courts and whether residing within or without the state, unless and except as to some litigants it is within the prohibition of" the Fourteenth amendment to the United States constitution, supra.

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Cite This Page — Counsel Stack

Bluebook (online)
178 N.W. 9, 171 Wis. 586, 1920 Wisc. LEXIS 167, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kentucky-finance-corp-v-paramount-auto-exchange-corp-wis-1920.