Warlick v. H. P. Reynolds & Co.

Hoke, J., after stating the facts: Jurisdiction in case of actions in personam can only be acquired by personal service of process within the territorial jurisdiction of the court, or by acceptance of service, or by a general appearance, actual or constructive, this last usually arising by reason of some motion in the cause, which can only be made in behalf of one who submithis case generally to the court’s jurisdiction. Vick v. Flournoy, 147 N. C., 209; Scott v. Insurance Co., 137 N. C., 515; Bernhardt v. Brown, 118 N. C., 701; Pennoyer v. Neff, 95 U. S., 715. *611 Ill the present case there has been no service in any of the modes suggested — none by personal service nor by acceptance personally — and our decisions are that an attorney at law, under his general authority as such, cannot make a valid acceptance of service of original process. Anderson v. Hall, 87 N. C., 381. And on the testimony it is found as a fact that the attorneys here had no special authority for the purpose indicated, nor has there been any general appearance, actual or constructive. True, there are decisions to the effect that when a motion for a continuance has been made and allowed, this will be considered a general appearance of the moving party, but such a ruling will no doubt be found to obtain in cases where the motion was made generally for the continuance of the cause, and not as here, where the appearance was expressly restricted to the special purpose of moving to dismiss for want of jurisdiction, and there was only a request for a temporary continuance of the motion. In so far as the action seeks to set aside the notes for fraud, and to enjoin their transfer, this is strictly an action in personam. An injunction can only operate in personamj and unless jurisdiction of the party can be acquired, the attempted procedure is a nullity, and, on motion properly made, it should be dismissed. Hinton v. Insurance Co., 126 N. C., 18; Telegraph Co. v. Telegraph Co., 49 Ill., 90; Hazelhurst v. Railroad, 43 Ga., 13; High on Injunctions (4th Ed.), sec. 33. In Hinton’s case it' was held: “1. The States of the, Union Being coequals in, authority and power, no State, through its courts, can extend its coercive power, nor provide for personal service of process, nor affect by judicial determination property outside of its own territory. Any such attempt to extend its jurisdiction beyond its own limits over persons or property in another State is without authority and void.” In Hazelhurst’s case, 43 Ga., supra, it was held: “That a court of equity of this State will not enjoin nonresidents of the State who are not and cannot be served with process, and who are outside of its boundaries, from doing acts of a personal character beyond the State lines and beyond the jurisdiction of its process for contempt of its order.” And in High on Injunctions, sec. 33, the doctrine is stated as follows: “The jurisdiction of equity by way of injunction being, as we have already seen, strictly in personam, it will not be exercised against persons and property beyond the borders of the State in which the proceedings are instituted. Neither law nor comity between distinct State governments recognizes the authority of one State to exercise jurisdiction over citizens and *612 property beyond its borders. Nor will equity attempt by injunction to restrain a nonresident defendant, wbo bas not been served with process, and who is not subject to the jurisdiction of the court, from performing some act beyond the State, even though there has been constructive service by publication as to such defendant.”' It is no satisfactory answer to this position that if the process is void, defendant need not regard it. One whose rights are involved and affected by an order of this character is not required to test its validity by disobedience, and thereby risk the process of contempt, but he may appear specially and have the court determine and inform him as to the validity of the proceedings; and if it be shown on the hearing that no personal service of process has been or can be had within the jurisdiction, the injunction should be dismissed (Adams v. Lamar, 8 Ga., 83-87); and if the ruling be against him, an appeal presently lies. This is the very course suggested and commended in Clark v. Mfg. Co., 110 N. C., 111, that the party affected should appear specially, and if the ruling be against him he can preserve his rights by noting an exception and entering a general appearance. True, it is held with us that where a motion to dismiss for want of jurisdiction is overruled, the party can only note his exception and proceed with the cause, and that no appeal then lies; but this is on the ground that overruling such a motion to dismiss is not ordinarily an appealable order, in that no substantial right of the litigant is thereby affected; but when the process is that of an injunction, an order continuing same, if valid, then and there affects a substantial right, and so an appeal, as stated, presently lies. It was suggested that this being an action to set aside the notes of resident debtors, it could be treated as a proceeding quasi in rem, as in cases of attachment, but this position is not sustained by authority. As a general rule, and for general purposes, the situs of negotiable notes is at the home of the creditor. It is otherwise, as indicated, in the case of attachment, wherein the situs of notes, for purposes of the process, is held to be at the home of the debtor. Cooper v. Security Co., 122 N. C., 463. This exception to the general rule is made chiefly on the ground that the court process in such ease operates on the indebtedness and affects the conduct of the debtor concerning it, to-wit, in reference to its payment and satisfaction; and, this' being recognized doctrine, creditors by note take and hold them subject to its application in cases where attachment lies. The same princi- *613 pie has been upheld in case of creditors’ bills operating in the nature of equitable fi. fas. (Beach on Injunctions, sec. 82, citing Bragg v. Gaynor, 85 Wis., 68); and also in actions affecting the title and interest of nonresidents in realty situate within the jurisdiction, as in Flournoy’s case, supra; Arndt v. Suggs, 134 U. S., 116. But in our case the relief sought can only be made effective by operating on the creditor and his interest in the notes and his conduct concerning them; and the situs of the notes, for the purpose of this action, therefore, comes under the general rule and must be considered as at the home of the creditor. Hinton v. Insurance Co., supra; Adams v. Lamar, supra. In this last case, Nisbet, J., quoting with approval from Dearing v. Bank, 5 Ga., 503, states the correct principle, as follows: “That the courts of this State have no extra territorial jurisdiction and cannot make the citizen of foreign States amenable to their process or conclude them by a judgment in personam without their consent; and a judgment in personam against a citizen of a foreign State, in a cause wherein he did not appear, although notice was served on him by publication, is a nullity.” We are of opinion, therefore, and so hold, that defendants’ motion in the present case was jurisdictional in its nature; that they had the right to appear specially, and, having properly noted their exceptions, they could test the validity of the injunction order by a present appeal, and that there was error in refusing to dissolve the injunction in accordance with their motion. On the record, however, we do not think the action could be dismissed, and this by reason of the claim for damages for fraud and deceit on the part of defendants in obtaining the notes in question, and the attachment issued in the cause and levied on indebtedness to defendants of certain citizens of Caldwell County, etc. We have held, in Worth v. Trust Co., at the present term, that under our statutes an attachment lies in a case of this character, citing, among other authorities, and as more especially pertinent to this case, Paper Co. v. Searing, 54 N. Y. Supreme Court, 237. And this process, as stated, having been levied on indebtedness to defendants from persons within the jurisdiction of the court, the cause will proceed for the purpose of condemning and applying the property levied on to such indebtedness as plaintiff may be enabled to establish on the trial. Pennoyer v. Neff, supra. This will be certified, to the end that the injunction be dismissed and the cause otherwise conducted in accordance with this opinion. 'Error.