American Casualty Co. v. Lea

Hughes, J. This is a petition by the insurance company praying for a writ to prohibit the circuit judge from proceeding in a cause pending before him, as judge of the Pulaski circuit court, which is a suit for libel by J. W. Callaway against the company and its agents; in which suit process was issued against the defendants, and served upon the Auditor of the State as the agent of the insurance company, which is a foreign corporation organized in the State of Maryland, and doing ‘ ‘ an accident, casualty, and employer’s liability insurance business in this State, and no other business in this State,” as stated in the petition for the writ of prohibition. The petition states that the company had complied with the insurance laws of the State, and had appointed the Auditor of the State to receive service of process for it; and the service in the said suit was upon the Auditor, by delivering to him a copy of the summons, as provided by the statute. The company, by attorney, appeared specially only, and filed a motion to quash the return on the summons, on the ground that the court had no jurisdiction of either the company or the subject matter of the suit. The motion was denied. Hence the application for the writ of prohibition. The complaint in the circuit court '(a copy of which is exhibited with the petition to this court) states that “as an unlawful means of advertising its business,” etc., the defendant company ‘ ‘ falsely and maliciously did publish, and cause to be published, libelous and defamatory matter about him, and accused him therein of having been guilty of embezzlement, which is a felony.” Now, the contention of the insurance company is that it can be sued in this State only upon liabilities growing out of its insurance contracts, while it does no other than an insurance business in the State; and that it cannot, therefore, be held to answer upon this service in a suit for libel in this State. x Corpora_ gum “oTiufei. It is well settled that a corporation may be guilty, of and can be sued and indicted for, libel. Odgers on Libel and Slander, 368 and 369; Townsend on Slander and Libel, sec. 261. 3 i¿aMnty. sLanceSco¿-“ t0 smt’ •' We are not prepared to accede to the proposition that a foreign insurance company, doing only an insuranee business in this State, can be sued only upon ities arising out of its insurance contracts made in this State. The cases cited in the brief of counsel to maintain this position go only to the extent of holding that the foreign corporation must be doing business in the State where it is sued, and that the cause of action upon which it is sued must have arisen in the State where the suit is brought.' We understand that when the foreign corporation agrees to “be found” in the State, it may be sued as' a domestic corporation or a citizen of the State upon any liability upon a cause of action arising within the State. Foreign as well as domestic corporations transact their business by agents, and wherever the duly authorized agent of the corporation is found, transacting its business, the corporation itself is found. St. Clair v. Cox, 106 U. S. 355. Sec. 11, art. 12, Const. of Ark., provides that “foreign corporations'may be authorized to do business in this State under such limitations and restrictions as may be prescribed by law ; provided that no such corporation shall do business in this State except while it maintains therein one or more known places of business, and an authorized agent or agents in the same, upon whom process may be served ; and, as to contracts made or business done in this State, they shall be subject to the same regulations, limitations and liabilities as like corporations of this State; and shall exercise no other or greater powers, privileges or franchises than may be exercised by like corporations of this State; nor shall they have power to condemn or appropriate private property.'” Section 3834 of Mansfield’s Digest is as follows : “ No insurance company, not of this State, nor its agents, shall do business in this State, until it has filed with the Auditor of this State a written stipulation, duly authenticated by the company, agreeing that any legal process affecting the company, served on the Auditor or the party designated by him, or the agent specified by said company to receive service of process for the company, shall have the same effect as if served personally on the company within this State.” “Whether the-stipulation is filed or not, service on the Auditor is sufficient service on the company, the latter being estopped to deny that it had filed the required stipulation,” when the company is doing business in the State, as it can do business in the State only upon compliance with the statute. Ehrman v. Teutonia Ins. Co. 1 McCrary, 123 ; St. Clair v. Cox, 106 U. S. 356. 3. Practice upon applicaof Whether the agents bind the corporation by their ac- . s. j tion, whether they act within the scope of their authority, express or implied, whether what they do grows out of or has any connection with the business of the corporation in this State, are questions not to be decided by this court in the first instance. They must be first tried by the circuit court upon the pleadings and the evidence. This corporation says, for instance, that it is not guilty of publishing the libel charge, and, therefore, denies its liability to suit in the courts of this State. This may be pleaded in bar and given in evidence, and, if true, will defeat the plaintiff’s claim. It cannot, therefore, be properly a subject of plea to the jurisdiction. In this controversy we must take the plaintiff’s cause of action to be such as he has alleged it to be in his complaint; otherwise we shall be trying the merits of the controversy for the purpose of determining whether we have power to try them. Nat'l Condensed Milk Co. v. Brandenburgh, 40 N. J. L. 112. The truth of the allegations of the complaint, as well as the sufficiency of them to constitute a cause of action, are not questions now before this court. The only question now here is, whether the circuit court obtained jurisdiction of the corporation by the service of the summons upon the Auditor as its agent. If so, it can render a personal judgment against the corporation, if the pleadings and proof in the case warrant it. The service was in accordance with the statute.. The prayer of the petition is denied.