Opinion
No. 35917.
October 22, 1945.
PLEADING.
In action on an account brought by foreign corporation not authorized to do business in the state, where general allegations of defendant's special plea and of plaintiff's replication raised an issue as to whether plaintiff was doing business in the state as respects its right to maintain the action, sustaining a demurrer to the replication was error, regardless whether the exhibits attached to the plea and replication disclosed a status of "doing business" (Code 1942, sec. 5319).
APPEAL from the circuit court of Covington county, HON. HOMER CURRIE, Judge.
Austin Austin, of Jackson, and G.H. Merrell, of Collins, for appellant.
The appellant was not doing an intrastate business in Mississippi, within the purview of Sections 4140 and 4146 of the Mississippi Code of 1940, so as to require it to file a copy of its charter with the Secretary of State and appoint a process agent in Mississippi.
J.B. Colt Co. v. Odom, 136 Miss. 651, 101 So. 853; Brenard Mfg. Co. v. Sumrall, 139 Miss. 507, 104 So. 160; J.R. Watkins Co. v. Poag et al., 154 Miss. 222, 122 So. 473; Morrison v. Guaranty Mortgage Trust Co., 191 Miss. 207, 199 So. 110; Quartette Music Co. v. Haygood, 108 Miss. 755, 67 So. 211; Wiley Electric Co. v. Electric Storage Battery Co., 167 Miss. 842, 147 So. 773; City Sales Agency, Inc., v. Smith, 126 Miss. 202, 88 So. 625; Marx Bensdorf v. First Joint Stock Land Bank of New Orleans, 178 Miss. 345, 173 So. 297; Watson v. J.R. Watkins Co., 188 Miss. 435, 193 So. 913; North American Mortgage Co. v. Hudson et al., 176 Miss. 266, 168 So. 79; Dodds v. Pyramid Securities Co., Inc., et al., 165 Miss. 269, 147 So. 328; Lee v. Memphis Publishing Co., 195 Miss. 264, 14 So.2d 351; Item Co. Ltd. v. Shipp, 140 Miss. 699, 106 So. 437; Refrigeration Discount Corporation v. Turley, 189 Miss. 880, 198 So. 731; Yellow Mfg. Acceptance Corp. v. American Oil Co., 191 Miss. 757, 2 So.2d 834; Smith v. J.P. Seeburg Corporation, 192 Miss. 563, 6 So.2d 591; C.I. T. Corporation v. Stuart, 185 Miss. 140, 187 So. 204; Dr. Koch Tea Co. v. Malone (Tex.) 163 S.W. 662; Layne v. Tribune Co., 63 App. D.C. 213, 71 F.2d 223, 293 U.S. 572, 55 S.Ct. 83, 79 L.Ed. 670; Code of 1930, Secs. 4140, 4146.
The laws of one state do not apply to the sale of goods F.O.B. in another state.
J.R. Watkins Co. v. Halloway (Mo.), 168 S.W. 290; International Text Book Co. v. Pigg, 217 U.S. 91; Chicago Crayon Co. v. Rodgers (Okla.), 119 P. 630; Crutcher v. Kentucky, 141 U.S. 47; Gunn v. Sewing Machine Co., 57 Ark. 24; Keating v. Favorite Co. (Tex.), 35 S.W. 417; Keptheart v. People (Colo.), 62 P. 946; Henderson v. Edwards, 84 Mo. App. 448; Koch Tea Co. v. Malone, supra; W.T. Rawleigh Co. v. Rose (Ark.), 202 S.W. 849; Cole Motor Co. v. Hurst, 228 F. 280; Puffer Mfg. Co. v. Kelly (Ala.), 73 So. 403; Sioux Remedy Co. v. Cope, 235 U.S. 97; W.T. Rawleigh Co. v. Trerice (Mich.), 195 N.W. 79; Heinrich Chemical Co. v. Herman (Mo.), 251 S.W. 162; J.R. Watkins Co. v. Coombes (Okla.), 166 P. 1072; Koch Veg. Tea Co. v. Schuman (Okla.), 139 P. 1133; Freeman Sipes Co. v. Corticelli Silk Co. (Okla.), 124 P. 972; Droege v. Ahearns Ott Mfg. Co., 163 N.Y. 466; Rock Island Plow Co. v. Peterson (Minn.), 101 N.W. 616; Toledo Com. Co. v. Glen Mfg. Co., 56 Ohio 217; Hogg v. J.R. Watkins Co. (Ark.), 228 S.W. 730; First Thomas v. Brewster, 282 U.S. 493.
The contract is a contract of sale and not agency.
McConnon Co. v. Haskin, 182 Mo. App. 140, 180 S.W. 21; Dr. Koch Tea Co. v. Malone, supra; W.T. Rawleigh Co. v. Holcomb (Ark.), 191 S.W. 214; Swift v. Warehouse Co. (Tenn.), 158 S.W. 480; J.R. Watkins Co. v. Hunt (Nebr.), 177 N.W. 462; Sinnett v. J.R. Watkins Co. (Ky.), 282 S.W. 769; Sager v. W.T. Rawleigh Co. (Va.), 150 S.E. 244; Hill v. H.C. Whitmer Co. (Ga.), 158 S.E. 625; W.T. Rawleigh Co. v. Harper (Wash.), 22 P.2d 665; W.T. Rawleigh Co. v. Snider (Ind.), 194 N.E. 356.
A foreign corporation need not take out registration papers as a condition to the right to sue for the collection of accounts, though the state in which suit is brought has a statute requiring registration.
International Text Book Co. v. Pigg, supra; Buck Stove Co. v. Vicars, 226 U.S. 205; Butler Bros. Shoe Co. v. U.S. Rubber Co., 156 F. 1; Koch Veg. Tea Co. v. Schuman (Okla.), supra.
The sending of printed matter to the purchaser from the company to assist in advertising goods does not change the contract from one of absolute sale.
Ross v. Northrup-King Co. (Wis.), 144 N.W. 1124; Rich v. Railway Co., 34 Wn. 308; Sucker State Drill Co. v. Wertz (N.D.), 18 L.R.A. (N.S.) 138; McConnon Co. v. Marshall (Tex.), 280 S.W. 323; W.T. Rawleigh Co. v. Bowers (S.C.), 172 S.E. 301; W.T. Rawleigh Co. v. Jones (N.M.), 47 P.2d 907.
Suggestions and advice to dealers by the company concerning the sale of goods by them does not tend to establish the relationship of agency between them.
Hughes v. Rawleigh Co., 182 Mo. 140, 180 S.W. 21; E.A. Lange Co. v. Johnson (Ark.), 197 S.W. 1168; Sparkman v. W.T. Rawleigh Co. (Okla.), 245 P. 828; W.T. Rawleigh Co. v. Fish (Tex.), 290 S.W. 798; Huckaby v. McConnon Co. (Ala.), 105 So. 886.
The transfer of merchandise does not take transaction outside of interstate commerce.
Continental Jewelry Co. v. Joseph, 140 Miss. 582, 105 So. 639; W.T. Rawleigh Co. v. Brown et al., 143 Miss. 895, 108 So. 720; L.D. Powell v. Roundtree (Ark.), 247 S.W. 389; M.E. Smith Co. v. Dickinson (Wash.), 142 P. 1133; Heinrich Chemical Co. v. Welch (Mo.), 300 S.W. 1001; J.R. Watkins Co. v. Beyer (Wis.), 233 N.W. 442; Mergenthaler Linotype Co. v. Gore (Fla.), 160 So. 148; Smith v. Mergenthaler Co., Inc. (Ark.), 58 S.W.2d 686; Equitable Credit Co., Inc., v. Rogers (Ark.), 299 S.W.2d 747.
Amendments are liberally allowed so as to bring the merits of the controversy between the parties fairly to trial.
Code of 1942, Sec. 1511.
Only in exceptional cases should amendments to pleadings be refused.
Greenwood Grocery Co. v. Bennett, 101 Miss. 573, 58 So. 482, 598; Bishop v. Fennerty, 46 Miss. 570.
W.U. Corley, of collins, for appellee.
The appellant is engaged in doing business in the State of Mississippi.
Watson v. J.R. Watkins Co., 188 Miss. 435, 193 So. 913; Marx Bensdorf v. First Joint Stock Land Bank of New Orleans, 178 Miss. 345, 173 So. 297; Case v. Mills Novelty Co., 187 Miss. 673, 193 So. 625; Quartette Music Co. v. Haygood, 108 Miss. 755, 67 So. 211; Peterman Construction Supply Co. v. Blumenfeld, 156 Miss. 55, 125 So. 548; J.R. Watkins Co. v. Goggans et al. (Ala.), 5 So.2d 472; W.T. Rawleigh Co. v. Hicks et al. (La.), 171 So. 616; W.T. Rawleigh Co. v. Coen et al. (La.), 195 So. 660; Watkins v. Gann (La.), 159 So. 747; Watkins v. Brown (La.), 126 So. 587; Pomeroy v. Hocking Valley Ry. Co. (N.Y.), 113 N.E. 504; Browning v. Waycross, 3 S.Ct. 578; Reynolds v. M.K. T. Ry. Co. (Mass.), 113 N.E. 413; Tausa v. Susquehanna Coal Co. (N.Y.), 115 N.E. 915; International Harvester Co. v. Kentucky, 34 S.Ct. 947; John Deere Plow Co. v. Kansas, 69 Kan. 255, 2 Anno. Cases 304; International Text Book Co. v. Pigg, 217 U.S. 91; General Railway Signal Co. v. Virginia, 38 S.Ct. 360; Dalton Adding Machine Co. v. Virginia, 38 S.Ct. 361; Kansas Struct. Steel Co. v. Arkansas, 46 S.Ct. 59; Mede Fiber Co. v. Varn et al., 3 F.2d 520; Myer v. Judd, 1 F.2d 513; Interstate Amusement Co. v. Albert, 128 Tenn. 417; Code of 1930, Secs. 4140, 4164.
Argued orally by H.L. Austin, for appellant, and by W.U. Corley, for appellee.
Appellant sued appellee upon an account for merchandise purchased under a contract establishing the terms and conditions under which the sales arrangement was set forth. The contract denominates this relationship as "a contract of buyer and seller and not of agency," and states that the buyer, appellee here, "is in business for himself." Whether these statements are effective to settle finally the status of appellee or whether such status is controlled by their subsequent dealings is in point in deciding the issues of pleading hereinafter discussed.
Appellant is a foreign corporation, and is not qualified nor authorized to do business in Mississippi. In addition to a plea of general issue, Lowry filed a special plea which set up that the plaintiff corporation was doing business in this State and not having legally qualified so to do was without right to maintain the action. Section 5319, Code 1942. The allegations of the plea were substantially of the tenor disclosed by the contract involved in Watson v. J.R. Watkins, 188 Miss. 435, 193 So. 913, and presumably under authority of this case a demurrer thereto was sustained.
An amended plea was filed, to which were attached numerous exhibits as an enlargement of the allegation that the plaintiff was, without authority, doing business in this State. There are general allegations to the effect that the goods were to be sold by Lowry under direction of the seller, that the goods were on consignment only; that sales were made and to be made by Lowry as a salesman under the seller's supervision; that buyer was required to procure other customers, to submit to inspection as to contracts and credits, and to devote his whole time to the promotion of sales of plaintiff's products. Further, it was alleged that it had a local resident agent who exercised supervision over buyer's disposition of plaintiff's goods, and that the buyer was required to assist in establishing other sales districts and procure other customers, and to assist in lobbying against legislation unfavorable to plaintiff's business. As stated, there was a general allegation that plaintiff was doing business in this State.
The special plea was sought to be documented with several exhibits "the written part of which is attached hereto, only in part." These exhibits include letters urging cooperation with the so-called local "agent" of plaintiff in procuring new dealers and otherwise; advertisements for "salesmen" in the State and various circulars relating to the method of conducting the business of the local dealer, and otherwise serving the interests of the plaintiff.
Demurrer to this second special plea was overruled, and plaintiff filed its replication denying the general allegations of the plea, as well as the content and intent of the several exhibits. Particularly does it deny that plaintiff is conducting a retail business in this State, and alleges that all exhibited communications from plaintiff are suggestive and advisory and do not constitute control over buyer's conduct of his own business, nor constitute him as agent of the plaintiff.
Demurrer to this replication was sustained and the cause dismissed. In the judgment on the demurrer, the trial court held that the exhibits to defendant's second special plea "none of which are denied by plaintiff's replication," and whereby plaintiff "impliedly admitted it is doing business within the state . . ." showed that it was so engaged.
It would have troubled us less if the trial court had not grounded its conclusion solely upon the exhibits to the plea. Regardless of our views as to the sufficiency of the exhibits to disclose a status of "doing business," the plea more than merely implied that these exhibits were only typical and definitely alleged that the plaintiff was doing a retail business in the State without authority. Both the plea and the replication were unique in their disclosure of the proposed evidence to sustain them, and without adjudging the effect of such procedure as a committal of the pleader to the particulars exhibited, we prefer to look to the general, though definite allegations of both the plea and the replication which, in our opinion, raised an issue as to whether appellant was doing business in this State. It was error to sustain the demurrer to the replication.
Reversed and remanded.