Court Opinion

ID: 6514866
Source: CourtListenerOpinion
Date Created: 2022-07-19 18:25:42.006657+00
Date Added: 2024-06-11T15:54:28.509060
License: Public Domain

WALKER, J.
It is the policy of this. State to permit foreign corporations to do business here only upon the condition that they submit themselves to the jurisdiction of the domestic tribunals in reference to liabilities incurred by them to citizens of the State. The purpose to protect the citizens of the State, who have dealings with corporations, from the inconveniences and expense incident to the enforcement of rights acquired in such dealings, when resort must be had to distant courts, is clearly manifested in the provision of the Constitution, that “no foreign corporation shall do any business in this State, without having at least one known place of business, and an authorized agent or agents therein;” in the statute, enacted to give force and effect to this provision of the Constitution, requiring every foreign corporation or company, before engaging in business in this State, to file in the office of the Secretary of State an instrument in writing, under the seal of the company, and signed officially by the president and secretary, “designating at least one known place of business in the State, and an authorized agent or agents residing thereat;” and in the provision of the Statute that “a foreign or domestic corporation may be sued in any county in which it does business by agent.” Constitution of Ala. Art. XIV, §4; Acts of Ala. T886-87 p. 102; Code, § 2642. The provisions to secure the opportu*590nity of bringing suits in the courts of this State against any foreign corporation doing business here are in furtherance of a policy, prevailing, it is believed, in every civilized government, of retaining control of the property of non-resident debtors found within its jurisdiction until the claims of resident creditors have been satisfied, so as to save such creditors, so far as this is practicable, from the necessity of resorting, for the enforcement of their demands, to foreign tribunals. "When claims are asserted in a domestic tribunal to the satisfaction of which property within its jurisdiction may be subjected, the control of such property will not be surrendered to any foreign court. No foreign court has the right to withdraw such property from the grasp of the domestic tribunal. It is only upon principles of comity that any recognition is given to the claim of a foreign court to draw to itself the control of property situated in this State. But considerations of comity are of no avail when the result would involve a violation of the domestic policy, or the defeat of remedies duly invoked in the domestic tribunals. It is, accordingly, the generally established rule, which has been recognized in this State, that the appointment of a receiver confers upon him no power to compel the recognition of his rights as receiver outside of the jurisdiction of the court maldng the appointment; and that the favor or courtesy of permitting him to sue as such receiver in the courts of another State will be extended only when the claims sought to be enforced do not conflict with the rights of citizens or creditors in the State where the suit is brought, and the enforcement of such claim is not in contravention of the policy of its laws. — Boulware v. Davis, 90 Ala. 207; Alley v. Caspari, 6 Amer. St. Rep., 185 ; Catlin v. Wilcox Silver Plate Co., 18 Amer. St. Rep., 338; Beach on Receivers, §§ 680-682.
The complainant in the present case sues as the receiver appointed by a Tennessee court to take charge of the affairs of the New South National Building & Loan Association, a Tennessee corporation, to collect its assets and settle its indebtedness to its creditors and stockholders, under the direction and control of that court. The bill does not show that the order 'of that court purported to effect the dissolution of the corporation. The mere appointment of a receiver left the corporation free to exercise powers not involving any interference with the rights of the receiver over property within the'jurisdiction of the court appointing him, and could not operate to prevent the bringing of suits against the corporation itself in the courts of another State, or to stay the process of such courts to subject property of the corporation *591found within tbeir jurisdiction' to tbe satisfaction of judgments rendered by them. Tbe corporation remained subject to suit, because it bad not been dissolved; and its property liere remained subject to seizure under process against tbe corporation, because tbe order of a court of another State was without extra-territorial effect to withdraw such property from tbe reach of tbe process of tbe courts of this State. Tbe complainant’s claim to recognition in tbe courts of this State, for tbe purpose of protecting and collecting tbe assets of tbe corporation found here, must be rested upon tbe fact, not very clearly disclosed by the averments of tbe bill, that the officers of the corporation, either negligently or willfully, or in obedience to tbe orders of a court having jurisdiction of tbeir persons, fail or refuse to take tbe necessary measures to save tbe assets in this State from waste or spoliation. If such is the fact, and tbe judgments in favor of tbe several defendants were recovered upon unfounded claims against tbe corporation, tbe attempts to subject to tbeir satisfaction tbe property of tbe corporation in this State are really frauds upon tbe rights of tbe parties beneficially interested in that property. When there are no valid claims to be asserted in tbe courts of this State against property found here, tbe court is justified in lending its aid to a foreign receiver for tbe protection of such assets, in order that they may be rendered available for a pro rata distribution among tbe creditors and stockholders in tbe one proceeding in tbe foreign tribunal. — Boulware v. Davis, supra. Though tbe complainant is recognized as a proper person to invoke tbe aid of tbe court for tbe protection of the property of tbe corporation in this State against fictitious claims, • yet, at last, tbe facts upon which bis impeachment of tbe judgments in favor of the defendants must be predicated are, that tbe claims sought to be enforced by tbe several defendants are without merit or foundation in law or in equity, and that tbe judgments were rendered without service of process upon the corporation. Tbe allegations as to these facts are clearly denied in tbe sworn answer of tbe defendants. Tbe answer avers that tbe person upon whom tbe process against tbe corporation was served was at tbe time its duly appointed and accredited agent in this State, and that the corporation owes tbe several amounts for which tbe defendants have obtained tbe judgments against it. These denials of the allegations upon which tbe equity of tbe bill rests justified tbe dissolution of tbe temporary injunction.
Upon tbe dissolution of tbe injunction, tbe chancellor made an order requiring of tbe defendants a refunding bond, *592under the provisions of section 3531 of the Code. A.s that bond would amply protect the complainant, in the event of his success in the trial on the merits, if the defendants shall have elected to proceed to enforce their judgments' pending the suit, it is unnecessary to inquire whether, in the absence of a requirement of such a bond, there is anything ' in the circumstances of the case to justify the exercise of the discretionary power of the court to order a re-instatement of the injunction, notwithstanding the denials of the answer. — Rice v. Tobias, 83 Ala. 348.
The decree dissolving the injunction must be affirmed.
Affirmed.