State ex rel. United States Fidelity & Guaranty Co. v. Mehan

581 S.W.2d 837
CourtMissouri Court of Appeals
DecidedFebruary 14, 1979
DocketNo. 39736
StatusPublished
Cited by4 cases

This text of 581 S.W.2d 837 (State ex rel. United States Fidelity & Guaranty Co. v. Mehan) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State ex rel. United States Fidelity & Guaranty Co. v. Mehan, 581 S.W.2d 837 (Mo. Ct. App. 1979).

Opinion

SMITH, Judge.

United States Fidelity and Guaranty Co. (hereinafter U.S.F.& G.) sought our writ of prohibition to prevent respondent judge from proceeding further in a suit entitled “Board of Governors of State Colleges and Universities of the State of Illinois [hereinafter Board] for the Use and Benefit of Mesker of Chicago, Inc., a corporation [hereinafter Mesker] v. United States Fidelity & Guaranty Co., a corporation.” We issued our preliminary writ and then after briefing and oral argument issued a divisional opinion quashing the preliminary writ. We then ordered a rehearing before an expanded panel and now make our preliminary writ permanent.

Alden Bennett Construction Co., Inc. entered into a contract in 1973 with the Board to construct the Commuter Center Addition of Northern Illinois University of Chicago, Illinois. Pursuant to Smith-Hurd Illinois Annotated Statutes, Chapter 29, § 15, Bennett, as prime contractor on the project, executed a performance and payment bond to the Board with U.S.F.& G. as surety thereon. Bennett then entered into a contract with Mesker (which despite its name is a Missouri corporation) for Mesker to supply hollow metal doors for the Addition.

In 1976, Mesker filed suit in the Circuit Court of the City of St. Louis, under the style heretofore set out, to recover on the bond for materials supplied to the Addition. U.S.F.& G. filed an answer and motion for judgment on the basis that the Circuit Court lacked jurisdiction over the subject matter by virtue of Smith-Hurd Illinois Annotated States, Chapter 29, § 16, which provides:

“. . . Such suit [on the bond] shall be brought only in the Circuit Court of this state in the judicial district in which the contract is to be performed.” 1

Mesker contends that this restriction may not be imposed upon a “transitory” cause of action created by the State of Illinois. It is generally true that a transitory action, whether created by statute or common law may be brought in any court of competent jurisdiction where jurisdiction over the defendant can be obtained. In Tennessee Coal, Iron & R. Co. v. George, 233 U.S. 354, 34 S.Ct. 587, 58 L.Ed. 997 (1914) the Supreme Court held that a “state cannot create a transitory cause of action and at the same time destroy the right to sue on that transitory cause of action in any court having jurisdiction.” l.c. 360, 34 S.Ct. 589. Such a statement, however, largely begs the question, for the question to be resolved is whether a statutorily created cause of action is in fact transitory or local. In State of California v. St. Louis Union Trust Company, 260 S.W.2d 821 (Mo.App. 1953) [16, 17] this court recognized that a particular cause of action created by statute could be made either transitory or local depending upon the provisions of the statute which created it. If the statute provides for a specific remedy, limited and prescribed, and tied to a local court, the cause of action created is local. This is in keeping with Tennessee Coal, supra, and Burford v. Sun Oil Co., 319 U.S. 315, 63 [839]*839S.Ct. 1098, 87 L.Ed. 1424 (1943). The teaching of Tennessee Coal, supra, and Atchison, T.&S.F.R. Co. v. Sowers, 213 U.S. 55, 29 S.Ct. 397, 53 L.Ed. 695 (1909) upon which it relies, is that the legislative decision to limit suit upon such cause of action to a specific court must be based upon some reasonable and legitimate state concern. Suspicion and distrust of the courts of sister states and protection of local business interests are not such reasonable and legitimate concerns. Both cases involved actions for personal injuries characterized in Atchison as “universally held to be transitory.” (l.c. 67, 29 S.Ct. 397). In Tennessee no legitimate basis for the restriction of an otherwise transitory cause of “action to Alabama appears. In Atchison the legislature specifically stated its reason for the restriction to be the protection of local business and the prevention of “derogation of the dignity of the courts” of the territory.

Before turning to a discussion of the reasonableness of the Illinois statute, we note that several courts, confronted with construction bond suits for work done in foreign jurisdictions having similar restrictions on the place of suit to that contained in the Illinois law have held that they lack jurisdiction because of such restriction. See Long v. Ferriss, 196 Mise. 567, 94 N.Y.S.2d 493 (City Ct.1949); Omega New York Products Corp. v. Parisi Bros. Inc., 57 Misc.2d 1000, 293 N.Y.S.2d 878 (Sup.1968). Both state and federal courts in Illinois have held that suits brought other than in the court prescribed by the Illinois statute must be dismissed for lack of jurisdiction. E.I. DuPont DeNemours & Co. v. McKay Engineering and Construction Co., 297 Ill.App. 495, 18 N.E.2d 64 (1938); Village of Crainville ex rel. Pipe and Valve Supply Co. v. Argonaut Insurance Co., Civil No. 74-34 — B (E.D. Ill. 5-24-76) (Unpublished). Federal courts have uniformly dismissed suits brought in a location other than that provided for in the Miller Act, 40 U.S.C.A. Sec. 270a et seq., which contains a similar restriction on suits, at least where the parties have not voluntarily agreed to a different forum. Some of these cases are based upon an absence of jurisdiction, others upon an absence of ven-United States ex rel. Vermont Marble v. Roscoe-Ajax Construction, 246 F.Supp. 439 (N.D.Cal.1965); U.S.F.& G. v. Hendry Corp., 391 F.2d 13 (5 Cir. 1968); United States ex rel. Industrial Lumber Co., Inc. v. F.D. Rich Co., Inc., 473 F.2d 720 (9 Cir. 1973). In those cases where statutes requiring performance and payment bonds on construction projects in foreign jurisdictions do not contain provisions restricting suit to the project state, courts generally hold the action may be brought wherever personal jurisdiction is acquired. State of Kansas ex rel. American Steel Works v. Hartford Accident and Indemnity Co., 426 S.W.2d 720 (Mo.App.1968); 85 A.L.R. 847. This is not universally true. See Commonwealth of Pennsylvania ex rel. Beals v. Beals, 139 Mise. 785, 249 N.Y.S. 232 (Sup. 1931). We have been cited to, and have found, no case holding forum restriction provisions in public construction bond statutes to be invalid or unenforceable. ue. Co.

In considering the question of reasonableness we note certain features of performance and payment bonds generally, and in particular the requirements of the Illinois statute.

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Bluebook (online)
581 S.W.2d 837, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-ex-rel-united-states-fidelity-guaranty-co-v-mehan-moctapp-1979.