Stavang v. American Potash & Chemical Corp.

227 F. Supp. 786, 1964 U.S. Dist. LEXIS 8326
CourtDistrict Court, S.D. Mississippi
DecidedMarch 31, 1964
DocketCiv. A. No. 3105
StatusPublished
Cited by6 cases

This text of 227 F. Supp. 786 (Stavang v. American Potash & Chemical Corp.) is published on Counsel Stack Legal Research, covering District Court, S.D. Mississippi primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stavang v. American Potash & Chemical Corp., 227 F. Supp. 786, 1964 U.S. Dist. LEXIS 8326 (S.D. Miss. 1964).

Opinion

WILLIAM HAROLD COX, Chief Judge.

This is a suit for personal injury sustained by the plaintiff in Cloquet, Minnesota, on October 22, 1956, when his clothing became impregnated with certain explosive chemicals manufactured by the defendant and being used by the plaintiff while in the employment of another in the manufacture of matches when his clothing ignited and resulted in his serious injury. The defendant is a Delaware corporation which was incorporated under the laws of that state in 1926, and has always since said time been amenable to process within that state. It has never done any business in Minnesota, and has never qualified to do business in that state. The defendant qualified to do business in Mississippi on January 27, 1958, and pursuant to the requirements of the laws of this state, [787]*787the defendant appointed a resident agent for process on it in connection with such business done in Mississippi. The plaintiff filed this suit in this court on April 5, 1961, and process was served on its statutory resident agent. The plaintiff has moved to quash this process and to dismiss the suit for lack of jurisdiction of the person of the defendant under such process. It is the contention of the defendant that such service of process on it in this case under such circumstances does not vest this court with jurisdiction over the person of the corporation on a claim which accrued to a non-resident of this state and outside the state of Mississippi and within the state of Minnesota. The defendant likewise moves for a summary judgment on the ground that this action is barred by the one year statute of limitations of Delaware where the defendant was at all times after October 26, 1956, suable. Those questions will be discussed and resolved in the order stated.

It was once the rule that a foreign corporation could not be sued in an action for the recovery of a personal demand outside the state in which it was chartered. The principle that a corporation must dwell in the place of its creation, and cannot migrate to another sovereignty, coupled with the view that an officer of the corporation does not carry his functions with him when he leaves his state, prevented the maintenance of personal actions against it in foreign jurisdictions. Cf: St. Clair v. Cox, 106 U.S. 350, 1 S.Ct. 354, 27 L.Ed. 222. Accordingly, most states require the foreign corporation to appoint a resident agent for process on it as a condition precedent to the grant of authority for such corporation to do business in the state. Mississippi has such a statute appearing as § 5319, Mississippi Code 1942. 18 Fletcher on Corporations 343, 344, says that the object of statutes of this nature is to provide for the collection of debts due from foreign corporations to its citizens and to enforce contracts made in the state by foreign corporations through its agents. The process in this case was not served on some ordinary agent of the corporation found in Mississippi such as is described in §§ 1860, 1866 and 5346, Mississippi Code 1942, but this process was served on the statutory agent appointed by virtue of and pursuant to the requirements of the statute for qualifying the corporation to do business in Mississippi. This injury from this manufactured product accrued to a citizen of Minnesota within the state of Minnesota prior to defendant’s qualifying to do business in Mississippi and has no relation to or connection with any business subsequently done in Mississippi. That appointment of such resident agent must be construed strictly as being in derogation of the common law on this subject as indicated. In Morris & Co. v. Skandinavia Ins. Co., Limited (5CCA), 27 F.2d 329, the plaintiff sued the defendant on a policy of marine insurance issued at Buenos Aires to cover a shipment of beef from Montevideo to Havana. Process, was served on the Insurance Commissioner of Mississippi as statutory resident agent of the corporation and later on Robert E. Wilkerson, Inc., as designated resident agent for process. A motion to quash the process and dismiss the-suit for lack of jurisdiction of the defendant was sustained and the suit was. dismissed by the trial court. In affirming that decision on appeal, it was said that appellee had reinsured risks on property situated in Mississippi, and in compliance with the laws of Mississippi had appointed the Insurance Commissioner of Mississippi and Wilkerson as its agent, for process; but that company (Wilkerson) has never had any transaction of reinsurance or other insurance for appellee, all such business being done in New York; that in compliance with Mississippi law that appellee filed annual statements of its reinsurance risks on Mississippi property and paid an annual tax based thereon. The Court further said: “We think it is clear appellee was not doing business in Mississippi, so as to be subject to suit in that state on a cause of action arising elsewhere. Old Wayne [Mutual] Life [Association] v. [788]*788McDonough, 204 U.S. 8, 27 S.Ct. 236, 51 L.Ed. 345; Simon v. Southern [Railway], 236 U.S. 115, 35 S.Ct. 255, 59 L. Ed. 492.” See copious annotation Central Motor Lines v. Brooks Transp. Co., 225 N.C. 733, 36 S.E.2d 271, 162 A.L.R. 1419, 1424-1426. On appeal the Supreme Court in Morris & Co. v. Skan-dinavia Ins. Co., Limited, 279 U.S. 405, 49 S.Ct. 360, 73 L.Ed. 762, said: “The policy sued on was issued and the loss occurred in South America. The importation of such controversies would not serve any interest of Mississippi. The purpose of state statutes requiring the appointment by foreign corporations of agents upon whom process may be served is primarily to subject them to the jurisdiction of local courts in controversies growing out of transactions within the state. Old Wayne Mut. Life Ass’n. v. McDonough, 204 U.S. 8, 18, 21, 27 S. Ct. 236, 51 L.Ed. 345; Simon v. Southern Railway Co., 236 U.S. 115, 130, 35 S.Ct. 255, 59 L.Ed. 492; Mitchell Furniture Co. v. Selden Breck [Const.] Co., 257 U.S. 213, 215, 42 S.Ct. 84, 66 L.Ed. 201; Louisville & Nashville R. Co. v. Chatters, 279 U.S. 320, 49 S.Ct. 329, 73 L.Ed. 711. The language of the appointment and of the statute under which it was made plainly implies that the scope of the agency is intended to be so limited. By the terms of both, the authority continues only so long as any liability of the company remains outstanding in Mississippi. No decision of the state Supreme Court supports the construction for which petitioner contends. And, in the absence of language compelling it, such a statute ought not to be construed to impose upon the courts of the state the duty, or to give them power, to take cases arising out of transactions so foreign to its interests. The service of the summons cannot be sustained.” In Morris & Co. v. Skandinavia Ins. Co., 161 Miss. 411, 137 So.

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Bluebook (online)
227 F. Supp. 786, 1964 U.S. Dist. LEXIS 8326, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stavang-v-american-potash-chemical-corp-mssd-1964.