World Carriers, Incorporated, a Corporation v. Louis L. Bright, Lemel Silas v. Paroh Steamship Corporation

276 F.2d 857, 1960 U.S. App. LEXIS 4812
CourtCourt of Appeals for the Fourth Circuit
DecidedApril 18, 1960
Docket7997_1
StatusPublished
Cited by8 cases

This text of 276 F.2d 857 (World Carriers, Incorporated, a Corporation v. Louis L. Bright, Lemel Silas v. Paroh Steamship Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
World Carriers, Incorporated, a Corporation v. Louis L. Bright, Lemel Silas v. Paroh Steamship Corporation, 276 F.2d 857, 1960 U.S. App. LEXIS 4812 (4th Cir. 1960).

Opinion

HAYNSWORTH, Circuit Judge.

In each of these cases, brought under the Jones Act against foreign corporations alleged to be doing business in Virginia but not domesticated there, substituted service of process was attempted by service upon Virginia’s Secretary of the Commonwealth upon the assumption that § 13-217 1 was controlling. The cases were tried and disposed of below upon the same assumption.

For the first time, it has now been made to appear that, prior to the commencement of either action, § 13-217 had been repealed insofar as it applied to an undomesticated, uncertificated foreign corporation doing business in Virginia. As to such a corporation, under § 13.1-119, 2 which applies on and after January 1, 1957, the unauthorized transaction of business in Virginia, without the appointment of an agent for the service of process, results in the constructive appointment of the Clerk of the State Corporation Commission as its statutory agent.

Prior to 1956, there had been no general revision of Virginia’s laws relating to corporations since 1903. It was recognized in 1954 that these laws were antiquated and inadequate. By an Act of April 8, 1954, 3 the Virginia Code Commission was directed to recommend a general revision of the corporation laws. With the assistance of special counsel, the Commission prepared a voluminous report which it transmitted to the Governor and the General Assembly on September 30, 1955. 4

The report of the Code Commission' contains a comprehensive proposal of a new corporation act, generally following,, in its most essential features, the Model Business Corporation Act of the American Bar Association, which was to replace entirely old Title 13 of the 1950 Code. 5

The proposed laws relating to business' corporations, with some changes, were adopted and enacted into law as a new Title 13.1 to replace old Title 13, in its entirety. 6 Technical and conforming amendments to sections codified under other titles were also adopted. 7 The repeal of old Title 13 was to become effective, generally, on January 1,1957.

Virginia had created a State Corporation Commission and charged it with the duty of regulating business corporations. The Code Commission recommended that the Corporation Commission, rather than the Secretary of the Commonwealth, was better equipped to handle service of process upon business corporations. 8 One of the changes effected by Title 13.1, therefore, was the general substitution of the Clerk of the Corporation Commission for the Secretary of the Commonwealth as the statutory agent for service of process upon corporations.

When service of process was attempted in these cases in June 1957, therefore, it was the Clerk of the Corporation Commission, not the Secretary of the Commonwealth, who was the statutory agent.

The effective date of the repeal of old § 13-217 was not January 1, 1957, for all purposes. New § 13.1-128 provided that § 13-217 should remain effective until July 1, 1958 to the extent it applied to the service of process upon previously *859 -certified, fully qualified foreign corporations. We find nothing in that section, however, which continues the effectiveness of § 13-217 beyond January 1, 1957 when the corporation to be served had not actually appointed the Secretary of the Commonwealth as its process agent.

The Act required, in effect, that all qualified foreign corporations requalify by filing specified documents with the Clerk of the Corporation Commission. Among the required filings was an appointment of the Clerk as process agent. Each such corporation was given eighteen months, or until July 1, 1958, within which to accomplish its re-qualification.

In recognition of the fact that confusion would exist during an interval in which the identity of the statutory agent and a previously appointed officer was not the same, special provision was made for the situation by § 13.1-128. That section makes it clear that service upon the Clerk of the Corporation Commission is effective whether or not the foreign corporation had requalified by appointing him its process agent. If it had not, the Clerk was required, during the eighteen months period, to transmit the process to the Secretary of the Commonwealth, the actually appointed process agent. Affirmative appointment of the Clerk of the Corporation Commission as process agent would revoke a previous appointment of the Secretary, but the revocation would be effective only on July 1, 1958. If during the eighteen months period, there were effective appointments of both officials, service upon the Secretary would be good, but he was required to transmit the process to the Clerk rather than to the corporation. If a foreign corporation, during the eighteen months period failed to appoint the Clerk its process agent, its qualification and certification were revoked, but its previous appointment of the Secretary as process agent was to be given continuing effect with respect to causes of action arising prior to July 1, 1958.

It was with one aspect of these situations that the General Assembly was concerned when, in a paragraph of § 13.1-128 dealing specifically with them, it was provided:

* * Notwithstanding anything elsewhere herein contained, the provisions of § 13-216 and § 13-217 shall remain effective until July 1, 1958, and thereafter as to causes of action arising prior to July 1, 1958, as to each foreign corporation whose certificate of authority is revoked by the provisions hereof because of failure to establish a registered office and appoint a registered agent.”

Read in context, it seems clear that the phrase describing foreign corporations whose certificates of authority are revoked by a failure to requalify is a modification of the continued effectiveness of § 13-217. The entire section deals with problems arising out of the impact of the new act upon previously qualified corporations. No reference is made anywhere in the section to a corporation doing business in the state on and before January 1, 1957 which had not qualified under the former act, or to a corporation which commenced doing business in Virginia after January 1, 1957. With respect to those corporations, the problems of duplicating and conflicting appointments did not exist. 9 No reason appears to have been recognized for not making the provisions of the new act, as to them, immediately and exclusively effective.

We read § 13.1-128 to postpone the effective date of the repeal of § 13-217 only as the latter section has application to corporations which had qualified under the former acts of which the section was a part.

*860 We do not think the delayed effectiveness of a collateral amendment of § 8-60 requires a different conclusion.

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Bluebook (online)
276 F.2d 857, 1960 U.S. App. LEXIS 4812, Counsel Stack Legal Research, https://law.counselstack.com/opinion/world-carriers-incorporated-a-corporation-v-louis-l-bright-lemel-silas-ca4-1960.