Court Opinion

ID: 3623729
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:04:52.358851+00
Date Added: 2024-06-11T13:59:02.069951
License: Public Domain

The Secretary of State must decide whether the name of a proposed domestic corporation or of a foreign corporation seeking authority to do business here is "the same name as a corporation authorized to do business under the laws of this state or a name *Page 63 
so nearly resembling it as to be calculated to deceive." In this case there is close resemblance, but not identity of name, between The Barber Company, Inc., a corporation organized under the laws of the State of New Jersey and which seeks authority to do business in this State, and Barber  Co., Inc., a corporation organized under the laws of this State a short time before The Barber Company, Inc., filed its application.
Mere similarity of name is insufficient to require or permit the Secretary of State to refuse an application to file a certificate. The resemblance must be so close as to be "calculated to deceive." Those words are not synonymous with "tending to confuse." The statutory test is whether members of the public by the resemblance of name might be induced to deal with a corporation believing that they were dealing with another corporation. That test can be applied only where there is proof of the nature of the business which the two corporations are authorized to carry on and which they do carry on. Whether similarity of names has tendency to deceive must depend to a great extent upon the fields in which the names are used.
When the Legislature conferred upon the Secretary of State the authority and the duty to determine the question, it placed no limitation upon the nature of the evidence which he might consider. I see no good reason why the courts should limit him to documents on file in his office and documents presented to him for filing in accordance with the statute. I see strong reasons why he should be permitted to consider any evidence which may be submitted to him and which may be relevant upon the question he must determine. Denial to a corporation of the right to do business in this State under the corporate name it has selected may work grave injury to the corporation. A valuable good will may be connected with that name which will be lost if it is compelled to carry on business under another name. *Page 64 
Where the chosen name is "calculated to deceive," it is reasonable and in accord with sound public policy to deny the right to carry on business under such name. Where in fact the choice of name is not calculated to deceive, denial of right to use it would be unreasonable. Documents in the office of the Secretary of State may in many instances be sufficient to determine the question of fact. If insufficient, or if his determination is challenged, the Secretary of State should be permitted to consider other evidence submitted to him. It may be that the power of the Secretary of State is not "equivalent to the plenary equity jurisdiction of the court" where there is claim of unfair competition. None the less, just as the equitable jurisdiction of the court may be invoked only where there is proof of deception, so the power of the Secretary of State to reject a certificate arises only where it appears that similarity of name is calculated to produce deception. The basic question to be determined is similar, and the Legislature did not intend that the Secretary of State should make an erroneous or inequitable determination because of arbitrary limitation placed upon the relevant evidence which he may consider.
This case illustrates the inequities and the anomalies which may arise if the powers of the Secretary of State are restricted in the manner suggested by the appellant. The petitioner seeks authority to do business here under its corporate name. Its main business is, as Judge LOUGHRAN points out, the production of asphalt and petroleum for paving and kindred uses. It has been authorized to conduct that business under its corporate name elsewhere in the United States, including the State in which the intervener was, until recently, incorporated. The intervener is chiefly engaged in the construction, repair and operation of steamships and other water craft. The applicant and the intervener operate in fields almost completely separate. The tendency of similarity of names to create deception or even confusion *Page 65 
in connection with the business to be conducted here is almost illusory. If hereafter the manner of conducting business by either should accentuate that tendency and result in unfair competition, a court by the exercise of its "plenary equity jurisdiction" can afford ample protection.
Denial of authority to the petitioner to do business here under its corporate name will require the petitioner to refrain from doing business here or to change its corporation name, and to obtain authority in this State and elsewhere to do business under the changed name. If it changes its corporate name, the changed name may be similar to the name selected by some other corporation in some other State. The difficulties and the inconveniences may be endless. The Legislature has decreed that in spite of such difficulties, authority to do business here shall be denied to a corporation using a name so nearly resembling the name of a corporation already authorized to do business here "as to be calculated to deceive." There must be evidence to justify a finding that deception may reasonably be anticipated as the result of similarity of name. There can be no reasonable anticipation of such result here, for the names will, it appears, be used only in widely separated fields. Therefore the order of the Appellate Division should be affirmed, with costs.
CRANE, Ch. J., O'BRIEN, HUBBS and RIPPEY, JJ., concur with LOUGHRAN, J.; LEHMAN, J., dissents in opinion in which FINCH, J., concurs.
Order reversed, etc. *Page 66