American Continental Import Agency v. SUP. COURT OF LOS ANGELES COUNTY
American Continental Import Agency v. SUP. COURT OF LOS ANGELES COUNTY
Opinion of the Court
Petitioner American Continental Import Agency, a limited association organized pursuant to the laws of the Federal Republic of Germany,
In support of its motion to quash service of summons the petitioner filed an afSdavit of Tadeus Kawalecki in which it was stated that the principal place of business of Aconia was in Munich, Germany, that it has never done business in the State of California, and that it has never maintained any representative of any kind within the State of California or within any other part of the United States. It was further stated: “Aconia is engaged exclusively in the business of importing aircraft parts and equipment into Germany for resale within Germany. Aconia has never solicited such import business in the State of California, the United States of America, its Territories or Possessions. All said aircraft parts
In an affidavit of A. H. Bergson, a director and officer of Aconia, who accompanied Mr. Kawaleeki to California in June 1961, it was stated that Mr. Kawaleeki’s four trips to California were made for the purpose of obtaining assurance from representatives of U. S. Fastener that the latter concern would deliver aircraft parts and equipment to Aconia’s customers pursuant to prior purchase orders issued in and mailed from Germany by Aconia to U. S. Fastener, the trips being necessary “soley [sic] by reason of the failure of U. S. Fastener to make delivery on said purchase orders. ...”
One of the affidavits submitted in opposition to the motion was that of the defendant Rudesill. Therein it was stated that the total amount of sales made to Aconia by U. S. Fastener in 1961 and in a part of 1962, while Mr. Rudesill “was operating the business of selling and exporting materials
While other affidavits were filed on behalf of the petitioner and on behalf of the real party in interest, the affidavits heretofore noted fairly set forth the factual situation upon the basis of which the question presented to this court is to be resolved. Such resolution must be based upon a consideration of those facts in the light of the reasoning of Henry R. Jahn & Son v. Superior Court, 49 Cal.2d 855 [323 P.2d 437], and Carl F. W. Borgward, G.M.B.H. v. Superior Court, 51 Cal.2d 72 [330 P.2d 789]. (See Traynor, Is This Conflict Really Necessary (1959) 37 Tex.L.R. 657, 658.)
In Henry R. Jahn & Son v. Superior Court, supra, 49 Cal.2d 855, at page 858, the governing principle was stated as follows: ‘ ‘ The statute authorizes service of process on foreign corporations that are 1 doing business in this State. ’ That term is a descriptive one that the courts have equated with such minimum contacts with the state 1 that the maintenance of the suit does not offend “traditional notions of fair play and substantial justice” ’ (International Shoe Co. v. Washington, 326 U. S. 310, 316 [66 S.Ct. 154, 90 L.Ed. 95, 102, 161 A.L.R. 1057, 1061].) Whatever limitation it imposes is equivalent to that of the due process clause. 1 “ [D]oing business” within the meaning of section 411 of the Code of Civil Procedure is synonymous with the power of the state to subject foreign corporations to local process.’ [Citations.] ”
In the Jahn ease, the court made the further statement (49 Cal.2d, at pages 859-860): “ Jahn’s purchase of goods in this state is a regular part of its business. It nevertheless contends that it is not amenable to suit here, invoking Rosenberg Bros. & Co. v. Curtis Brown Co., 260 U. S. 516 [43 S.Ct. 170, 67 L.Ed. 372]. The United States Supreme Court, however, has advanced beyond the presence theory of jurisdiction underlying that case. (McGee v. International Life Ins. Co., 355 U. S. 220 [78 S.Ct. 199, 200, 2 L.Ed.2d 223]; see also International Shoe Co. v. Washington, 326 U. S. 310, 316-317 [66 S.Ct. 154, 90 L.Ed. 95, 101-102, 161 A.L.R. 1057, 1062].) Under the minimum contacts test of the International Shoe case regular sales solicitation alone can constitute doing business rendering the foreign corporation amenable to process in actions engendered by such activities. [Citations.] Since there is no distinction for jurisdictional purposes between regular selling and regular buying [citations],
“The Supreme Court has emphasized its departure from the presence test by the significance it now attaches to the fact that the cause of action arises out of the defendant's contacts with the state asserting jurisdiction. . . . ‘But to the extent that a corporation exercises the privilege of conducting activities within a state, it enjoys the benefits and protection of the laws of that state. The exercise of that privilege may give rise to obligations, and, so far as those obligations arise out of or are connected with the activities within the state, a procedure which requires the corporation to respond to a suit brought to enforce them can, in most instances, hardly be said to be undue. ’ (International Shoe Co. v. Washington, 326 U. S. 310, 319 [66 S.Ct. 154, 90 L.Ed. 95, 104, 161 A.L.R. 1057, 1063].)”
In the present ease Aconia’s purchases constituted a systematic and continuous course of business and were made in a very substantial amount. Moreover, there was more than the mere purchase of California goods pursuant.to orders originating in Germany; on four occasions Mr. Kawaleeki came to California for the purpose of expediting compliance by the vendor with the agreements for the sale of articles. (Cf. Dungan, Hood & Co. v. C. F. Bally, Ltd., 271 F. 517, 519.) Although such efforts were subsequent to the inception of the contractual relationship between Aconia and U. S. Fastener, they were not without significance in that the purpose was to protect and enforce Aconia’s rights. It is a reasonable assumption that such acts were of value to Aconia in obtaining the performance of the contractual obligations undertaken by the vendor. (See Note 108 U. Pa.L.Rev. 131, 139-141.) The litigation instituted by Pasadena Investment Company arose by virtue of assignments to it of claims of U. S. Fastener of California which had their origin in the assignor’s contractual relationship with Aconia. Such obligations fall within the category of those which ‘ ‘ arise out of or are connected with the activities within the state.” (See International Shoe Co. v. Washington, 326 U. S. 310, 319 [66 S.Ct. 154, 90 L.Ed. 95, 104, 161 A.L.R. 1057, 1063].) The several-sided controversy with respect to the rights to receive payments due pursuant
For the reasons stated hereinabove the conclusion must be reached that “the quality and nature of . . . [Aconia’s] activity in relation to the fair and orderly administration of the laws” fully justifies subjecting Aeonia to the jurisdiction of the courts of this state. (See International Shoe Co. v. Washington, supra, 326 U.S. 310, 319 [66 S.Ct. 154, 90 L.Ed. 95, 104, 161 A.L.R 1057, 1063].)
The alternative writ is discharged and the peremptory writ is denied.
Shinn, P. J., concurred.
With respect to the question here presented, both parties to this proceeding consider the association to be in the nature of a corporation.
In McGee v. International Life Ins. Co., 355 U.S. 220, it was said, at pages 222-223: “ Looking back over this long history of litigation a trend is clearly discernible toward expanding the permissible scope of state jursdietion over foreign corporations and other nonresidents. In part this is attributable to the fundamental transformation of our national economy over the years. Today many commercial transactions touch two or more States and may involve parties separated by the full continent. With this increasing nationalization of commerce has come a great increase in the amount of business conducted by mail across state lines. At the same time modern transportation and communication have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity.” (See also Empire Steel Corp. v. Superior Court, 56 Cal.2d 823, 834 [17 Cal.Rptr. 150, 366 P.2d 502].)
Concurring Opinion
I concur in the denial of the petition upon the authority of Henry R. Jahn & Son v. Superior Court, 49 Cal.2d 855 [323 P.2d 437]. There is a valid basis for distinguishing the two cases on their facts. Jahn was an action for relief against acts of unfair competition committed in California for the purpose of destroying a California company. Our case is an action for the price of goods shipped to a foreign buyer. Nevertheless, the ground upon which the Supreme Court placed the Jahn decision seems to cover this case too.
Petitioner’s application for a hearing by the Supreme Court was denied July 10, 1963.
Reference
- Full Case Name
- AMERICAN CONTINENTAL IMPORT AGENCY, Petitioner, v. THE SUPERIOR COURT OF LOS ANGELES COUNTY, Respondent; PASADENA INVESTMENT COMPANY, Real Party in Interest
- Cited By
- 16 cases
- Status
- Published