Court Opinion

ID: 8788799
Source: CourtListenerOpinion
Date Created: 2022-11-26 13:43:49.426302+00
Date Added: 2024-06-11T17:03:13.629326
License: Public Domain

*543On Rehearing.
Certain papers were not before me when a decision was rendered setting aside the service process on the defendant Deerfield Dumber Company, but refusing to do so as to the defendant Amos N. Blandin individually. I have now examined and considered again all the affidavits and briefs of the respective counsel, but must adhere to my former conclusions. The action is to recover for services in negotiating the sale of certain lands then belonging to the Deerfield Lumber Company pursuant to an agreement for compensation in so doing, and which were sold later. It is alleged that the agreement was between Ostrander, the plaintiff, and both the defendants, and it would seem both were interested in procuring the sale. While defendants deny the agreement, and deny that it was made in the state of New York, as asserted by the plaintiff, for the purposes of this motion, I assume and hold that the agreement was made, and that it was made in the state of New York. Assuming a breach of that agreement and the liability of defendants under it, as I am bound to do on this motion, the question is: Could valid service, which will be recognized by the federal courts, of the summons in this action in the Supreme Court of the state of New York be made on the defendant corporation by service on Amos N. Blandin, the president of the corporation, when he was temporarily in the state of New York, his residence being in the state of New Hampshire, but not on business of the defendant company, and not representing the defendant company, or transacting any business for such company?
The affidavits presented by the plaintiff do not establish that Blan-din was in the state of New York on any business of the defendant company, and representing it, when the service of the summons was made on him at Troy, N. Y., or that the company was then doing any business in the state of New York, or that it had any property or place of business, or agent designated by it upon whom service of process could be made in the state of New York. The affidavits tend to show, and I will assume do show, that this property referred to, situated in Vermont, having been sold and transferred to Rich Lumber Company by the Deerfield Lumber Company; some considerable time before, there was some question as to the lines, and Blandin had agreed with one Hanley, the woods superintendent of the Rich Lumber Company, to have lines run or located on said lands, which were situated in the state of Vermont, and not in the state of New York, and that under the employment of Blandin one Howard was then on said lands engaged in locating lines. Also, Blandin had hardwood for sale in Vermont, and Hanley was desirous of discussing both matters with Blandin, and an' appointment was made by Hanley with Blandin to meet him and a third person, one Veatries, at Troy, and Blandin and Hanley did meet them at the time the service of the summons was made.
Hanley said they did discuss such matters, but the affidavits fail to show that Blandin even represented himself to be acting for the Deer-field Lumber Company, or that any discussion was had in'its behalf, or that it was in fact interested in the discussion. If the Deerfield *544Lumber' Company, as well as Blandin, was obligated to survey the lines, and was then engaged in such survey, and some discussion was had at Troy between Hanley and Blandin, this hardly rises to the dignity of transacting business within the meaning of the decisions. Blandin was interested in the lands sold and the lines to be run, and the affidavits say he made the agreement as to the lines, but do not show he made any such agreement as president or in behalf of the defendant company. But it is not necessary to decide that proposition, as only by way of inference upon a very slight foundation can it be said the defendant had any interest in the matter, and it is not made to appear that Blandin was then representing or acting for the Deerfield Lumber Company in that, so far as appears, independent discussion.
In Craig v. Welch Motor Car Co. et al. (C. C.) 165 Fed. 554, decided by Ward, Circuit Judge, of the Circuit Court of Appeals in this circuit, the plaintiff and defendant had matters in dispute, and defendant, a foreign corporation, sent its agent into the state of New York to effect some sort of a settlement. While these negotiations were in progress, one of the defendant’s directors, named Swaut, came to New York City on his way to visit some friends in Amsterdam. It was shown that he went to the office of the plaintiff company every day for some time, and discussed the pending negotiations, which finally fell through. Swaut went on to Amsterdam, and there he was served with the summons in an action in the state court, and the case was removed to the federal court, where the motion was made to'set aside the service of the summons. Ward, Circuit Judge, in granting the motion, said:
“As the canse of action arose here, the service was good in the courts of this state [New York] under section 432, Code of Civil Procedure. But the rule in the federal courts is different. Goldey v. Morning News, 156 U. S. 518, 15 Sup. Ct. 559, 39 L. Ed. 517. The affidavits satisfy me that Swaut was not acting for the defendant while in this state, and, if he were, a single transaction would not he enough to make service on him as a nonresident director good service on the defendant in the federal courts” — citing many cases.
In Wilkins v. Queen City Savings Bank & Trust Co. (C. C.) 154 Fed. 173, Lacombe, Circuit Judge, also of the Circuit Court of Appeals in the Second Circuit, held:
“rI!he presence of an officer of a corporation in another state than that of its domicile, for the purpose of discussing a proposed, adjustment of a. single controversy, does not constitute a doing of business within the state by the corporation, such as to subject it to the jurisdiction of a federal court thereon by service of process on such officer.”
Following these decisions, as I feel bound to do, the presence of Blandin in Troy, N. Y., for the purpose of discussing the matter referred to, even if in behalf of the corporation of which he was president, did not subject the corporation to the jurisdiction of the state courts for the purpose of serving a summons in an action; that is, he was not transacting business within the meaning of the decisions. It was not like adjusting losses, etc. And see Mut. Life Ins. Co. v. Spratley, 172 U. S. 602, 19 Sup. Ct. 308, 43 L. Ed. 569.
*545I do not need to reiterate what was slated in my former opinion, that it is now settled that service on an officer of a foreign corporation in the state of New' York, held good by the courts of that state under the Code of Civil Procedure, is not necessarily good under the.federal law, and, if not, then, when the case is removed from the state of New York to the federal court, the service may be set aside, unless the defendant has appeared generally in the state court, or has answered, or otherwise waived the defective service. All cases to the contrary are now overruled by the decision of the Supreme Court of the United States. Goldey v. Morning News, 156 U. S. 518, 15 Sup. Ct. 559, 39 U. S. 517, was a case commenced in the Supreme Court of the state of New York and removed by defendant to the federal court, when the motion to set aside the service was made. The Supreme Court held:
“In a personal action brought in a court of a state against a corporation vhieli neither is incorporated nor docs business within the state, nor has any agent or property therein, service of the summons upon its president, temporarily within the jurisdiction, cannot be recognized as valid by the courts of any other government. A corporation .sued in a personal action in a court of a state, within which it is neither incorporated nor does business, nor has any agent or property, does not, by appearing specially in that court for the sole purpose of presenting a petition for the removal of the action into the Circuit Court of the United States, and by obtaining a removal accordingly, waive the right to object to the jurisdiction of the court for want of sufficient service of the summons.”
The motion to set aside the service on the defendant corporation must be granted.