Smith v. Mutual Life Insurance Co. of New York

96 Mass. 336
CourtMassachusetts Supreme Judicial Court
DecidedJanuary 15, 1867
StatusPublished
Cited by7 cases

This text of 96 Mass. 336 (Smith v. Mutual Life Insurance Co. of New York) is published on Counsel Stack Legal Research, covering Massachusetts Supreme Judicial Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Smith v. Mutual Life Insurance Co. of New York, 96 Mass. 336 (Mass. 1867).

Opinion

Wells, J.

The question of jurisdiction relates, not only to the parties, but also to the subject matter of the suit. Story Confl. L. § 586. Bissell v. Briggs, 9 Mass. 462.

In the present case it does not merely regard the powers of the court, but rather the extent of the state authority which underlies those powers. It is in the nature of a question of sovereignty.

The parties are a non-resident plaintiff against a foreign corporation. The defendant is not only non-resident, but incapable even of a temporary presence within the jurisdiction, otherwise than by representation.

The subject matter of the suit is not a present demand capable of enforcement and seeking satisfaction out of property or rights within the jurisdiction. Upon the plaintiff’s bill, it appears that there is not even an existing contract between the parties. The proceeding is based upon a past relation, growing out of a contract made without the jurisdiction, which, by its own terms, has ceased to be operative. The plaintiff seeks, through the equity powers of this court, not only to revive his contract as an executory obligation, but also, as incident thereto, to reinstate himself as a member of the defendant corporation.

A corporation, being a mere creature of local statutes, can, of right, have no existence nor recognition beyond the limits of the state wherein it is established. By comity such artificial persons are permitted to contract and to sue in other states. If they avail themselves of that comity, to sue or to make contracts in another state, they may become liable to its jurisdiction to the extent to which they have thus voluntarily subjected themselves. If they have property or rights within the limits of [340]*340another state, suits can be maintained and judgments enforced against them, to the extent of such property and rights ; but this results from the authority of the state over whatever is within its limits, and not from any jurisdiction over the corporation itself. The judgment is operative only to the extent of such property and rights. As to these it is analogous in its effects to a proceeding in rem. Bissell v. Briggs, 9 Mass. 462. Blackstone Manuf. Co. v. Blackstone, 13 Gray, 488.

The more extended jurisdiction sought to be exercised in this case must stand, if at all, upon the provisions of the Gen. Stsc. 58, § 68.

The purpose of that statute, and of the accompanying sections, was manifestly to secure to our own citizens the benefit and protection of our own laws and tribunals, so far as practicable, in their contracts with insurance companies located elsewhere, but which avail themselves of the comity extended to them to prosecute their business within the limits of this state, through their agents here. The statute must therefore be con- . strued with reference to this apparent object. Whether, in order to make it applicable in any case, the concurrent facts of residence of the party, and a contract made or property or life insured within the state, or either of these facts, would be absolutely requisite, we need not now determine. In the case of the Lafayette Ins. Co. v. French, 18 How. 404, the court, in sustaining the jurisdiction of the state court under a similar statute in Ohio, seem to regard the facts that the contract was made in Ohio,. with a citizen of that state, and to insure property situated there, as of importance in giving to that state the right to exercise such authority over a corporation established in Indiana. But assuming, for the purposes of the present case, that the statute is available to all plaintiffs — non-residents as well as residents — and for all liabilities wherever contracted, and that it would give jurisdiction for a valid judgment for the amount due upon a policy actually in force as a contract, it would still fail to afford ground for exercise of the jurisdiction which the plaintiff’s bill requires.

The statute contains no provision except for the service of [341]*341process. It does not touch the question of jurisdiction otherwise. It does not assume, nor attempt to confer upon the court, nor require the foreign corporation to concede, any right to exercise authority over the organization, the corporate functions, the by-laws, nor the relations between the corporation and its members ; nor to determine the rights and obligations of the corporation or its members, arising under the law of its creation, and depending on such local law. The requirements of the statute are fully answered, in respect to proceedings in the courts, when the corporation appears as defendant, and waives all question as to due service of process. The foreign corporation will not thereby stand differently in court from any other party who has appeared to defend without objecting to the jurisdiction over the person of the defendant. He may still plead a want of jurisdiction on the ground that the subject matter of the suit, or the remedy sought, is beyond the reach of the court, or not within the sovereign power of the state from which the court has its authority.

The provision that process may be served on the agent of the foreign corporation “ with like effect as if the company existed in this state ” accompanied by the stipulation that such service “ shall be of the same force and validity as if served on said company,” cannot transfer to the tribunals of this state any power which would not be acquired by the mere fact of actual service, or waiver of service, upon the defendant. It cannot obliterate the fact, nor change the consequences that result from the fact, of the non-resident character of the defendant. Such service upon a citizen of another state, casually or temporarily within the reach of process, does not ordinarily subject all his relations, rights and obligations to the cognizance of the courts of the state in which he happens to be found; but only such as have arisen therein, and such as are in their nature personal or transitory. His debts due upon contracts, and bis liability to damages for personal torts, under laws of general recognition, are of this transitory nature, and may be enforced wherever the person of the defendant can be found. All contracts carry with them the law of the place where they were made, to govern [342]*342their interpretation and effect. In suits upon contracts made and causes of action arising elsewhere, the courts thus do, indeed, to some extent, administer the laws of other states. But in such cases the proceedings are only incidentally affected by them ; they do not depend upon such foreign laws. The rights and liabilities of parties under local laws do not always follow them into other jurisdictions. Many of those rights and liabilities, particularly under our federal system of government, are clearly beyond the reach of the sovereignty of another state. Others are of- such local concern, and so affect local administration only, or depend upon local statute law, that the tribunals of other states may and ought properly to refuse to exercise any jurisdiction in regard to them. It certainly would not be within the power of the state to subject a foreign corporation to the operation of its own insolvency laws; nor to authorize its courts to administer upon it the insolvency laws of the state of its location. And an agreement, in accordance with a statute requiring it, to submit, through its agent here, to all processes requisite for that purpose, would not give validity to such proceedings, even if our laws of insolvency were adapted to the case of a foreign corporation.

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Cite This Page — Counsel Stack

Bluebook (online)
96 Mass. 336, Counsel Stack Legal Research, https://law.counselstack.com/opinion/smith-v-mutual-life-insurance-co-of-new-york-mass-1867.