Court Opinion

ID: 8839633
Source: CourtListenerOpinion
Date Created: 2022-11-26 16:36:50.608625+00
Date Added: 2024-06-11T17:05:10.222923
License: Public Domain

Mr. Presiding Justice Matchett dissenting: With due deference, I must dissent in this case from the judgment of the court. In the first place, because I am inclined to think the finding of the trial court that the American Standard Metal Products Corporation was at the time of the execution of the contract on February 19, 1921, doing business in Illinois within the meaning of the act of the legislature which forbids a foreign corporation so to do before obtaining a license, according to the provisions of the act, is ag’ainst the manifest preponderance of the evidence. I am aware it is very difficult to deduce from the many decided cases the general rule which should be applied in determining when a foreign corporation is or is not doing business in this State within the meaning of that act. The cross-defendants invoke the rule as stated in Corpus Juris, 14 A, 1279: “A foreign corporation is not doing, transacting, carrying on, or engaging in business in a state, within the meaning of the statutes under consideration, by the doing of acts therein which are merely preliminary to the transaction of the business for which the corporation is organized.” Here the acts which it is held amounted to doing business within the meaning of the statute were, in my opinion, merely preliminary in their nature. The statute, as the opinion of a majority of the court indicates, is highly penal in its nature and therefore should be strictly construed, and upon such construction the finding oug’ht not to be sustained. Again assuming that the statute was applicable and that the American Standard Metal Products Corporation was doing business in the state contrary to its provisions, and that the foreign corporation could not therefore bring an action upon the contract and that it must, in that sense, be held to be void, it by no means follows that the domestic corporation which, without knowledge of the foreign corporation’s disqualifications, entered into a contract with it, could not maintain an action upon the contract thus made. In other words, although by reason of the provisions of the statute, the contract in a suit brought thereon by an unlicensed foreign corporation should be held void, in a suit brought upon the same contract by the domestic corporation against the foreign corporation, the contract would be held valid. The one party is precluded and estopped but the other party is neither precluded nor estopped. If the American Standard Metal Products Corporation sued at law either on the contract or the notes, the contract would in such suit be held void and the plaintiff corporation could not recover by reason of the statute irrespective of the merit of its suit; but if the ¥m. R. Johnston Manufacturing Company brought a suit at law upon the contract, it could, upon making the proper proofs, recover on it. Whatever the rule at law might be, the parties here have seen fit to appeal not to a court of law but to a court of equity, and a court of equity is always a court of conscience, granting relief only where the requirements of justice and fair dealing demand that the relief should be given. The precise question which arises on this record is whether in a court of chancery, a contract void as to one party but valid as to the other by reason of a statute, may be rescinded in a court of equity at the suit of a party complainant who can maintain an action at law thereon, where the defendant has not violated any of the terms of the contract and is ready, willing and able to perform all the terms of the contract. The affirmative of the proposition is not consonant with natural justice. The precise question not having been decided in this state, I think the court should follow the dictum of the court of appeals of New York in Mahar v. Harrington Park Villa Sites, 204 N. Y. 234. I think the Chancellor erred in decreeing a cancellation of the contract, and that the decree should be reversed and the cause remanded with directions to dismiss the cross-bill for want of equity.