Court Opinion

ID: 9445125
Source: CourtListenerOpinion
Date Created: 2023-08-03 21:20:09.366853+00
Date Added: 2024-06-11T17:30:07.859366
License: Public Domain

JAMES ALGER FEE
(dissenting).
The opinion states that the District Court in this controversy sits as another court of the State of Arizona. Guaranty Trust Co. of N. Y. v. York, 326 U.S. 99, 108, 65 S.Ct. 1464, 89 L.Ed. 2079. Judge Walsh is the resident District Judge, trained at the bar of that state. He is acquainted not only with the statute and decisional law of the state, but with the nuances of practice and procedure, both administrative and judicial, of the state. If it were a question of enacting a law for the State of Arizona regarding the qualification of a foreign corporation to do business there, the rule adopted by this opinion might serve excellently. But this Court has not that power. Moreover, it appears not to be seemly for this Court to tell Judge Walsh what the Supreme Court of Arizona will hold when this question comes up to that court. We all know that the Supreme Court of the state may lay down a rule contrary to the holding of this opinion of the majority tomorrow.
“In any case, we should accord great weight to the District Court’s view of New York law.” Reitz v. Mealey, 314 U.S. 33, 39, 62 S.Ct. 24, 28, 86 L.Ed. 21.
“ * * * the considered appraisal of the trial judge * * * of the Colorado law is entitled to great weight and should not be overruled unless it is clearly erroneous.” Mitton v. Granite State Fire Ins. Co., 10 Cir., 196 F.2d 988, 992.
“ * * * the reasoned opinion of a trial court upon the status of the law of the local state within which it acts should be accorded great weight by this court * * *. That rule applies especially on occasions when, in default of authoritative state legislative enactment or judicial ruling, the trial court declares its appraisal of the probable course of the state’s highest court in the event of the submission to it of the controverted legal issue. * * * “* * * * * All that this court reasonably can be expected to do in reviewing cases governed by state law is to see that the determination of the trial court is not induced by a clear misconception or misapplication of the law.’ ” Mogis v. Lyman-Richey Sand & Gravel Corporation, 8 Cir., 189 F.2d 130, 134.
Besides, it seems the statute and the decisions give us fair warning.
The legislature of the State of Arizona had the power to impose terms upon which a foreign corporation shall be allowed to carry on business within the state. The statute enacted by the legislature provided that a foreign corporation should file a copy of its articles and do other qualifying acts “before entering upon, doing, or transacting any business”, and underlined the purpose by the following section, which reads:
“No foreign corporation shall transact any business in this state until it has complied with the requirements of the preceding section, and every act done by said corporation prior thereto shall be void.”
There is no reason why this plain direction should not be carried out. Worcester did business in the State of Ari*52zona from the beginning of March, 1949, until October, 1952, a period of two years. Its operation apparently involved dozens of transactions and many thousands of dollars. Even today, it has not complied with the exact command of the statute. All of its acts were void prior to compliance. Defendant has proved a general course of manufacturing household items in the State of Arizona for more than two years and did not pay its license fee. Therefore, under the case of Monaghan & Murphy Bank v. Davis, 27 Ariz. 532, 234 P. 818, quoted in the opinion, the defense was made out. The act of making the lease was one part of the extensive activity of the plaintiff within the state and constituted part of doing business by plaintiff. National Union Indemnity Co. v. Bruce Bros., 44 Ariz. 454, 38 P.2d 648, cannot be distinguished.
It is difficult to determine by what logic the first act or an intermediary act or the final act of a company, unlawfully doing business in a state, can be isolated and declared valid when the statute expressly proscribes as void “every act done by said corporation prior” to issuance of the certificate. This corporation did not perform an isolated act. It did business in defiance of the law of the state which harbored it. There is no injustice in enforcing the statute as written.