Case Name: White Sewing Machine Company, Appellant, v. Norman M. Harris et al., Appellees
Court: Illinois Appellate Court
Jurisdiction: Illinois
Decision Date: 1910-08-15
Citations: 161 Ill. App. 122
Docket Number: 
Parties: White Sewing Machine Company, Appellant, v. Norman M. Harris et al., Appellees.
Judges: 
Reporter: Illinois Appellate Court Reports
Volume: 161
Pages: 122–132

Head Matter:
White Sewing Machine Company, Appellant, v. Norman M. Harris et al., Appellees.
1. Cobpoeations—foreign corporation must comply with new act. A foreign corporation which has complied with the act of 1897 must nevertheless comply with the new act of 1905, as the terms of the latter act are substantially different from those of the former.
2. Contbacts—what does not impair obligation of. Passing a new law requiring all foreign corporations whether licensed under a former act or not, to perform further conditions before doing business in this state, does not impair the obligation of contracts, since such former license is not an irrepealable contract, and is not a contract between the state and the corporation that the state will not exact further conditions from such corporation.
Duncan, J., dissenting.
Action of debt. Appeal from the Circuit Court of Pulaski county; the Hon. A. W. Lewis, Judge, presiding.
Heard in this court at the March term, 1910.
Affirmed.
Opinion filed August 15, 1910.
Wall & Martin, for appellants.
C. S. Miller and Charles L. Rice, for appellees.

Opinion:
Messrs. Justices Higbee and Shirley
delivered the opinion of the court.
White Sewing Machine Company sued the defendants in an action of debt on bond for $600. The declaration is in the usual form assigning breaches of the condition of the bond as the failure of said Norman M. Harris to pay six promissory notes. The defendants filed a special plea in substance that at the time of the execution of said bond the plaintiff was a corporation organized in the State of Ohio and doing business in said state for profit, and is not a railroad or telegraph company, is not engaged in the insurance, banking or money lending business, and that said writings were executed in the State of Illinois to secure the purchase price of goods sold by plaintiff in Illinois since July 1, 1905. Avers that plaintiff had not prior to this suit complied with all the requirements of an act entitled "An act to regulate the admission of foreign corporations for profit, to do business in the State of Illinois," approved May 18, 1905, in force July 1, 1905; and was not licensed and empowered by the Secretary of State under said statute to do business in this State, and therefore plaintiff cannot maintain its action. Plaintiff in its replication replied that on September 10, 1897, it made application to the Secretary of State for a license and complied with all the terms of the foreign corporation act entitled "An act to require every foreign corporation doing business in this State to have a public office or place in this State to transact its business, ' ' etc., approved May 26, 1897, in force July 1, 1897, and obtained a certificate from said Secretary of State empowering it to do business in this State for ninety-nine years, etc. A general demurrer to said replication was filed by the defendants. The court entered judgment on the demurrer in favor of defendants and against the plaintiff for costs and barring its suit, etc., and plaintiff electing to stand by its replication appealed. It is conceded by both parties to this suit that the only question in this case for our decision, is whether or not a foreign corporation which has qualified to do business in Illinois under said Act of 1897, has to again qualify under the said act of 1905 in order to continue doing business in this State.
The said Act of 1897 was amended by adding a few minor details, April 22, 1899. Session Laws of 1899, p. 118. No substantial change as to the requirements of foreign corporations to obtain a license to do business in this State was made by this amendment; and, so far as we are aware, no contention has ever been made that they were required by this amendment to requalify in order to continue to do business .here. Section 4 of said act was also amended May 13, 1905; but the amendment in no way affects the question'here, and it was repealed before it took ef feet by the express provisions of section 8 of the Act of 1905, now under consideration. Session Laws of 1905, 125 and 128. The provisions and regulations with which foreign corporations for profit were required to comply before they could be permitted to transact any business in this State, as provided by the statute of 1897 and the amendments thereto, are found in paragraphs 67b and 67c of chapter 32 of Hurd's Revised Statutes of 1899, p. 466. For the purpose of aiding a proper comparison of these two paragraphs with paragraphs 67c and 67d of the new act of 1905, wherein are found the new provisions and requirements to be met by such corporations, in chapter 32 of Hurd's Rev. Stat. 1908, p. 539, we here below give the provisions of the old statute rearranged and transposed so that they will follow as nearly as practicable in the same order that they are found in the new act; and for convenience we will number the paragraphs 67c and 67d as numbered in the new act, and will follow each quotation from the old act with the number of the paragraph of the old act from which such quotation is taken. The statute as amended in 1899 and as so transposed reads as follows:
67c. "Every company incorporated for the purpose of gain under the laws of any other State, territory or country, now or hereafter doing business within this State,"—"such corporation by its president, secretary or any officer thereof, shall make and forward to the Secretary of State, with the articles or certificate above provided for, a statement duly sworn to, of the proportion of capital stock of the said corporation which is represented in the State of Illinois by its property located and business transacted . therein and such statement shall further show the name and address of the agent or representative of said corporation in this State."—"and shall file in the office of the Secretary of State a copy of its charter or articles of incorporation, or in case such company is incorporated merely by a certificate, then a copy of its certificate of incorporation duly certified and au thenticated by the officer who issued the original, or by the recorder or registrar of the office in which said original charter, articles or certificate may have been recorded."—"Upon a compliance with the above provisions by said corporation, the Secretary of State shall give a certificate that said corporation has duly complied with the laws of this State, and is authorized to do business therein, stating the amount of its entire capital and of the proportion thereof which is represented in Illinois; and such certificate shall be taken by all courts in this state as evidence that the said corporation is entitled to all the rights and benefits of this act, and such corporation shall enjoy those rights and benefits for the time set forth in its original charter or articles of association, unless this shall be for a greater length of time than is contemplated by the laws of this State, in which event the time and duration shall be the limit of time set out in the laws of this state. Such corporation having complied, as aforesaid, shall be required to promptly report to the Secretary of State any change in the name and address of its agent or representative in this State, arid any increase or decrease in its capital stock, and any increase or decrease of the proportion of its capital stock represented in this State by its property and business therein, by filing in the office of Secretary of State a statement properly sworn to, setting forth the facts: provided, that nothing in this act shall be taken or construed into releasing foreign loan, building and loan, bond investment, surety, or other corporations of like character from any provisions of law requiring them to make a deposit of money with a proper officer of the State to protect from loss the citizens of this State who may do business with such corporations: And provided, further, that the provisions of this act shall not apply to railroad or telegraph companies which have heretofore built their line of railway into or through this State, nor to insurance, banking or loaning companies." All foregoing in 67c, old Stat. "And no foreign corporation established or maintained in any way for pecuniary profit of its stock holders or members shall engage in any business other than that expressly authorized in its charter, or the laws of this State under which it may come. ' ' 67b old Stat.
67d. "Every corporation for pecuniary profit formed in any other state, territory or country, before it shall be authorized or permitted to transact business in this State, or to continue business therein, if already established, shall designate some person as its agent or representative in this State on whom service of legal process may be had if desired; shall have and maintain a public office or place in this State for the transaction of its business, and where proper books shall be kept to enable such corporation to comply with the constitutional and statutory provisions governing such corporation; and such corporation shall be subject to all liabilities, restrictions and duties which are or may be imposed upon corporations of like character organized under the general laws of this State, and shall'have no other or greater powers." 67b old Stat. "And shall be required to promptly report to the Secretary of State any change in the name and address of its agent or representative in this State." 67c, old Stat.
"Nor shall it hold any real estate except such as may be necessary and proper for carrying on its legitimate business. And no corporation incorporated under the laws of any other state, territory or country, doing business in this State, shall be permitted to mortgage, pledge or otherwise encumber its real or personal property situated in this State to the injury or exclusion of any citizen or corporation of this State who is a creditor of such foreign corporation. And no mortgage by any foreign corporation, except railroad and telegraph companies, given to secure any debt created in any other State, shall take effect as against any citizen or corporation of this State until, all its liabilities due to any person or corporation in this State at the time of recording such mortgage have been paid and extinguished." 67b, old Stat.
"And such corporation shall be required to pay into the office of the Secretary of this State, upon the proportion of its capital stock represented by its property and business in Illinois, fees equal to those required of similar corporations formed within and under the laws of this State." 67c, old Stat.
A careful examination and comparison of the foregoing paragraphs, comprising paragraphs 67b and 67c of the old act in a transposed form, with paragraphs 67c and 67d of the new act, show that very substantial changes and additions have been made to the old law of 1897. By paragraph 67i of the new act the said statute of 1897 with its amendments is expressly repealed, as well as "all acts and parts of acts in conflict" with the new act. By this repeal we are to understand that the new statute contains the whole law on the subject expressed in its title and that before any foreign corporation for profit shall be permitted or allowed to transact any business, or exercise any of its corporate powers in this State, other than those expressly excepted by this statute, it shall be required to comply with the provisions of the new act and shall be subject to all of the regulations prescribed therein, as is provided in 67b of the new act. After thoroughly considering the new act we think that all the sections in it are clearly intended to apply to all foreign corporations for profit, including those that have qualified under the act of 1897, except such corporations as the new act expressly excludes from its provisions. The legislature undoubtedly has the power to impose the terms by which a foreign corporation may transact business within this State. 6 Thompson on Corporations, secs. 7884 and 7887; Weidenger v. Spruance, 101 Ill. 278; People v. Rose, 207 Ill. 352; City of Danville v. Danville W. Co., 178 Ill. 299; In Re Estate of Speed, 216 Ill. 23.
Passing a new law requiring all foreign corporations whether licensed under a former act or not, to perform further conditions before doing business in this State, does not impair the obligation of contracts, since such former license is not an irrepealable contract, and is not a contract between the State and the corporation that the State will not exact further conditions from such corporation. Home Ins. Co. v. Augusta, 93 U. S. 116; Armour Pack. Co. v. Vinegar Bend L. Co., 149 Ala. 205; Western U. T. Co. v. State, 82 Ark. 309; Hammond P. Co. v. Ark., 212 U. S. 322.
It is conceded by the appellant that unless it has complied with the law in relation to obtaining a license to do business in this State that it cannot recover in this case, and such is the law. Union Lead Co. v. Reedy Elevator Co., 222 Ill. 199.
There is no question made as to the sufficiency of the pleadings to present the single question as to whether or not compliance with the law of 1897 by appellant is a sufficient compliance under the act of 1905. The majority of the court are of the opinion that the changes in the new law are so considerable, and that the wording of the new act is such as to make it clear that the legislature intended to, and that the new act does, require the plaintiff to requalify under the new act before it can legally do business in this State, and not having' complied with the new act that it cannot maintain its suit against appellees. To hold otherwise would, in our judgment, be in effect holding that foreign corporations doing business in this State under the old law would not be required to comply with the new regulations and burdens that are added to the former requirements by the new statute, and therefore the burdens imposed upon corporations organized for the same purpose, but under the different laws, would be unequal. All foreign corporations to which this act applies should be made to conform to the same duties and regulations before doing business in this State, and we think that under the provisions of this statute it is intended to apply to all foreign corporations whether licensed to do business under the old law or not, unless exempted therefrom by the express provisions of the act. The judgment of the lower court is therefore affirmed.
Affirmed.