Court Opinion

ID: 7201059
Source: CourtListenerOpinion
Date Created: 2022-07-24 17:08:09.615678+00
Date Added: 2024-06-11T16:16:31.587800
License: Public Domain

ELLIOTT, J.
Dissents to final opinion on rehearing for written reasons.
MOUTON, J.
In May, 1925, a beneficiary certificate was issued by defendant to Mart Kendall, deceased husband of plaintiff, who brings this suit for herself, individually, and for her minor daughter, Gloria, as beneficiaries thereunder.
Plaintiff alleged that the defendant association had no agent in this state on whom process could be served, and asked that it be cited through the Secretary of State.
Defendant excepted to the jurisdiction of the court, alleging that the court was without authority to cite it through the Secretary of State. The exception was maintained, and the suit dismissed.
Plaintiff appeals.
The constitution and rules of defendant association, domiciliated in Cleveland, Ohio, show that it is organized solely for the benefit of its members and their beneficiaries; that it has a lodge system and a representative form of government; that it provides for the payment of death benefits for physical disability and old age at 70, all in accordance with the provisions of section 5 of Act 256, 1912, p. 565. The defendant association must therefore be classed as a fraternal benefit society under that act.
Section 17 of that act provides that every society, domestic or foreign, shall before admission and before being licensed, appoint in writing the Secretary of State and his successors, to be its lawful attorney upon whom all legal process against it, shall be served.
The defendant association, without pretending at all that it had complied with this imperative requirement of Section 17 of said Act, came into court for the sole purpose of excepting to its jurisdiction on the ground that it had no power to cite it through the Secretary' of State. The appearance of defendant in the manner stated, carried with it an implied admission or confession that it had been doing business in the state without having appointed an agent, or the Secretary of State, as its agent for service of process of which it was charged in plaintiff’s original and amended petition.
A corporation cannot do business in a state without its express or implied consent which may be given on such terms as the state may see fit to impose. Old Wayne Mutual Life Association vs. Flynn, 66 N. E. 57. It may require as a condition precedent to do business in the state, that a corporation shall in writing designate an agent or put an officer on whom process against it shall be served. Ruling Case Law, Vol. 21, p. 1350, Verbo, process, par. 99. It is stated in connection with the above “that there is some conflict, however, as to whether a foreign corporation doing business within the state without complying with a statute requiring as a condition precedent the designation of a state official to accept service of process, is bound by service on such official. One view is that by doing business in the state the corporation necessarily submits to the service of process against it on the officer whom it must have designated had any designation been made, and the other, that by failing to comply with the statute, the corporation merely subjects itself to the penalties and consequences therein enumerated.” In a number of cases it is said in connection with the above quotation, that the principal of estoppel has been held controlling against a defendant excepting to the jurisdiction of the court by setting *52up the fact that it had not appointed one to accept service as required by the statute, the courts holding that defendant was estopped from setting up its own misconduct. It was so held in Showen vs. Owen Co., 133 Am. State Rep. 376; 122 N. W. 640. See also Penn. Fire Insurance Co. vs. Gold Mining Co., 243 W. T., p. 243, 61 Law Ed. 616. It is true that defendant did not set up here as a fact that it had not complied with the requirements of the statute by failing to appoint the Secretary of State for service of process. It was, however, charged in the original petition that it had not appointed an agent to whom process could be served. This charge necessarily included its failure to appoint the Secretary of State.
In an amended petition filed by plaintiff it was there directly alleged that it had failed to appoint the Secretary of State for service of process. Defendant renewed its exception to the jurisdiction without making reference to the charges of its failure to. make that appointment or designation. It must be held under the pleadings that its defense of want of jurisdiction is based on the fact that it has not appointed the Secretary of State or any agent in the state upon whom process could be served, and that the citation on the Secretary of State was without legal authority or power, as contended by defendant, and therefore, null. It is true that authorities referred to by us, were cases where corporations were involved. Here, the defense is urged by a fraternal association, not, it is true, organized under the laws of this State but which comes as hereinabove stated, under the provisions of Act 256 of 1912. This Act, under which defendant is basing its rights in our courts provides that before an association of its character can do business in the State, it must appoint the Secretary of State as its lawful attorney for the service of process. Such being the statutory requirement, we are of the opinion that defendant cannot take advantage of its own misconduct by pleading that the court has no jurisdiction over it because of its failure to observe the essential requirements of the statute.
The judgment appealed from is therefore avoided and reversed, and this case is remanded to the lower court to be proceeded with according to law, appellee to pay the costs of this appeal, those below to abide the decision of this suit.