A foreign corporation, owning gold and silver mines in the
Philippine Islands, temporarily carried on in Ohio (during the
Japanese occupation of the Philippines) a continuous and
systematic, but limited, part of its general business -- consisting
of directors' meetings, business correspondence, banking, stock
transfers, payment of salaries, purchasing of machinery, etc. While
engaged in doing such business in Ohio, its president was served
with summons in an action
in personam against the
corporation filed in an Ohio state court by a nonresident of Ohio.
The cause of action did not arise in Ohio, and did not relate to
the corporation's activities there. A judgment sustaining a motion
to quash the service was affirmed by the State Supreme Court.
Held:
1. The Federal Constitution does not compel Ohio to open its
courts to such a case -- even though Ohio permits a complainant to
maintain a proceeding
in personam in its courts against a
properly served nonresident natural person to enforce a cause of
action which does not arise out of anything done within the State.
Pp.
342 U. S.
440-441.
2. The Due Process Clause of the Fourteenth Amendment also does
not prohibit Ohio from granting such relief against a foreign
corporation.
Old Wayne Life Assn. v. McDonough,
204 U. S. 8, and
Simon v. Southern R. Co., 236 U.
S. 115, distinguished. Pp.
342 U. S.
441-447.
3. As a matter of federal due process, the business done by the
corporation in Ohio was sufficiently substantial and of such a
nature as to permit Ohio to entertain the cause of action against
it, though the cause of action arose from activities entirely
distinct from its activities in Ohio. Pp.
342 U.S. 447-449.
4. It not clearly appearing, under the Ohio practice as to the
effect of the syllabus, whether the Supreme Court of Ohio rested
its decision on Ohio law or on the Fourteenth Amendment, the cause
is remanded to that court for further proceedings in the light of
the opinion of this Court. Pp.
342 U. S.
441-449.
155 Ohio St. 116,
98 N.E.2d
33, vacated and remanded.
Page 342 U. S. 438
In two actions in an Ohio state court, the trial court sustained
a motion to quash the service on the respondent foreign
corporation. The Court of Appeals of Ohio affirmed, 88 Ohio App.
118, 95 N.E.2d 5, as did the State Supreme Court, 155 Ohio St. 116,
98 N.E.2d
33. This Court granted certiorari. 342 U.S. 808.
Judgment
vacated and cause remanded, p.
342 U. S.
449.
MR. JUSTICE BURTON delivered the opinion of the Court.
This case calls for an answer to the question whether the Due
Process Clause of the Fourteenth Amendment to the Constitution of
the United States precludes Ohio from subjecting a foreign
corporation to the jurisdiction of its courts in this action
in
personam. The corporation has been carrying on in Ohio a
continuous and systematic, but limited, part of its general
business. Its president, while engaged in doing such business in
Ohio, has been served with summons in this proceeding. The cause of
action sued upon did not arise in Ohio and does not relate to the
corporation's activities there. For the reasons hereafter stated,
we hold that the Fourteenth Amendment leaves Ohio free to take or
decline jurisdiction over the corporation.
After extended litigation elsewhere, [
Footnote 1] petitioner, Idonah Slade Perkins, a
nonresident of Ohio, filed two actions
in personam in the
Court of Common Pleas of Clermont
Page 342 U. S. 439
County, Ohio, against the several respondents. Among those sued
is the Benguet Consolidated Mining Company, here called the mining
company. It is styled a "sociedad anonima" under the laws of the
Philippine Islands, where it owns and has operated profitable gold
and silver mines. In one action, petitioner seeks approximately
$68,400 in dividends claimed to be due her as a stockholder. In the
other, she claims $2,500,000 damages, largely because of the
company's failure to issue to her certificates for 120,000 shares
of its stock.
In each case, the trial court sustained a motion to quash the
service of summons on the mining company. Ohio Com.Pl., 99 N.E.2d
515. The Court of Appeals of Ohio affirmed that decision, 88 Ohio
App. 118, 95 N.E.2d 5, as did the Supreme Court of Ohio, 155 Ohio
St. 116,
98 N.E.2d
33. The cases were consolidated, and we granted certiorari in
order to pass upon the conclusion voiced within the court below
that federal due process required the result there reached. 342
U.S. 808.
We start with the holding of the Supreme Court of Ohio, not
contested here, that, under Ohio law, the mining company is to be
treated as a foreign corporation. [
Footnote 2] Actual notice of the proceeding was given to
the corporation
Page 342 U. S. 440
in the instant case through regular service of summons upon its
president while he was in Ohio acting in that capacity.
Accordingly, there can be no jurisdictional objection based upon a
lack of notice to a responsible representative of the
corporation.
The answer to the question of whether the state courts of Ohio
are open to a proceeding
in personam, against an amply
notified foreign corporation, to enforce a cause of action not
arising in Ohio and not related to the business or activities of
the corporation in that State rests entirely upon the law of Ohio,
unless the Due Process Clause of the Fourteenth Amendment compels a
decision either way.
The suggestion that federal due process compels the State to
open its courts to such a case has no substance.
"Provisions for making foreign corporations subject to service
in the state is a matter of legislative discretion, and a failure
to provide for such service is not a denial of due process. Still
less is it incumbent upon a state in furnishing such process to
make the jurisdiction over the foreign corporation wide enough to
include the adjudication of transitory actions not arising in the
state."
Missouri P. R. Co. v. Clarendon Co., 257 U.
S. 533,
257 U. S.
535.
Page 342 U. S. 441
Also without merit is the argument that, merely because Ohio
permits a complainant to maintain a proceeding
in personam
in its courts against a properly served nonresident natural person
to enforce a cause of action which does not arise out of anything
done in Ohio, therefore the Constitution of the United States
compels Ohio to provide like relief against a foreign
corporation.
A more serious question is presented by the claim that the Due
Process Clause of the Fourteenth Amendment prohibits Ohio from
granting such relief against a foreign corporation. The syllabus in
the report of the case below, while denying the relief sought, does
not indicate whether the Supreme Court of Ohio rested its decision
on Ohio law or on the Fourteenth Amendment. The first paragraph of
that syllabus is as follows:
"1. The doing of business in this state by a foreign
corporation, which has not appointed a statutory agent upon whom
service of process against the corporation can be made in this
state or otherwise consented to service of summons upon it in
actions brought in this state, will not make the corporation
subject to service of summons in an action
in personam
brought in the courts of this state to enforce a cause of action
not arising in this state, and in no way related to the business or
activities of the corporation in this state."
155 Ohio St. 116, 117,
98 N.E.2d
33, 34.
If the above statement stood alone, it might mean that the
decision rested solely upon the law of Ohio. In support of that
possibility, we are told that, under the rules and practice of the
Supreme Court of Ohio, only the syllabus necessarily carries the
approval of that court. [
Footnote
3] As
Page 342 U. S. 442
we understand the Ohio practice, the syllabus of its Supreme
Court constitutes the official opinion of that court, but it must
be read in the light of the facts and issues of the case.
Page 342 U. S. 443
The only opinion accompanying the syllabus of the court below
places the concurrence of its author unequivocally upon the ground
that the Due Process Clause of the Fourteenth Amendment prohibits
the Ohio courts from exercising jurisdiction over the respondent
corporation in this proceeding. [
Footnote 4] That opinion is an official part of the report
of the case. The report, however, does not disclose to what extent,
if any, the other members of the court may have shared the view
expressed in that opinion. Accordingly, for us to allow the
judgment to stand as it is would risk an affirmance of a decision
which might have been decided differently if the court below had
felt free under our decisions to do so.
The cases primarily relied on by the author of the opinion
accompanying the syllabus below are
Old Wayne Life Assn. v.
McDonough, 204 U. S. 8, and
Simon v. Southern R. Co., 236 U.
S. 115. Unlike the case at bar, no actual notice of the
proceedings was received in those cases by a
Page 342 U. S. 444
responsible representative of the foreign corporation. In each
case, the public official who was served with process in an attempt
to bind the foreign corporation was held to lack the necessary
authority to accept service so as to bind it in a proceeding to
enforce a cause of action arising outside of the state of the
forum.
See 204 U.S. at
204 U. S. 22-23,
and 236 U.S. at
236 U. S. 130.
The necessary result was a finding of inadequate service in each
case and a conclusion that the foreign corporation was not bound by
it. The same would be true today in a like proceeding where the
only service had and the only notice given was that directed to a
public official who had no authority, by statute or otherwise, to
accept it in that kind of a proceeding. At the time of rendering
the above decisions, this Court was aided, in reaching its
conclusion as to the limited scope of the statutory authority of
the public officials, by this Court's conception that the Due
Process Clause of the Fourteenth Amendment precluded a state from
giving its public officials authority to accept service in terms
broad enough to bind a foreign corporation in proceedings against
it to enforce an obligation arising outside of the state of the
forum. That conception now has been modified by the rationale
adopted in later decisions, and particularly in
International
Shoe Co. v. Washington, 326 U. S. 310.
Today, if an authorized representative of a foreign corporation
be physically present in the state of the forum and be there
engaged in activities appropriate to accepting service or receiving
notice on its behalf, we recognize that there is no unfairness in
subjecting that corporation to the jurisdiction of the courts of
that state through such service of process upon that
representative. This has been squarely held to be so in a
proceeding
in personam against such a corporation, at
least in relation to a cause of action
Page 342 U. S. 445
arising out of the corporation's activities within the state of
the forum. [
Footnote 5]
The essence of the issue here, at the constitutional level, is a
like one of general fairness to the corporation. Appropriate tests
for that are discussed in
International Shoe Co. v. Washington,
supra, at
326 U. S.
317-320. The amount and kind of activities which must be
carried on by the foreign corporation in the state of the forum so
as to make it reasonable and just to subject the corporation to the
jurisdiction of that state are to be determined in each case. The
corporate activities of a foreign corporation which, under state
statute, make it necessary for it to secure a license and to
designate a statutory agent upon whom process may be served provide
a helpful, but not a conclusive, test. For example, the state of
the forum may by statute require a foreign mining corporation to
secure a license in order lawfully to carry on there such
functional intrastate operations as those of mining or refining
ore. On the other hand, if the same corporation carries on, in that
state, other continuous and systematic corporate activities as it
did here -- consisting of directors' meetings, business
correspondence, banking, stock transfers, payment of salaries,
purchasing of machinery, etc. -- those activities are enough to
make it fair and reasonable to subject that corporation to
proceedings
in personam in that state, at least insofar as
the proceedings
in personam seek to enforce
Page 342 U. S. 446
causes of action relating to those very activities or to other
activities of the corporation within the state.
The instant case takes us one step further to a proceeding
in personam to enforce a cause of action not arising out
of the corporation's activities in the state of the forum. Using
the tests mentioned above, we find no requirement of federal due
process that either prohibits Ohio from opening its courts to the
cause of action here presented or compels Ohio to do so. This
conforms to the realistic reasoning in
International Shoe Co.
v. Washington, supra, at
326 U. S.
318-319:
". . . there have been instances in which the continuous
corporate operations within a state were thought so substantial and
of such a nature as to justify suit against it on causes of action
arising from dealings entirely distinct from those activities.
See Missouri, K. & T. R. Co. v. Reynolds, 255 U.S.
565; [
Footnote 6]
Tauza v.
Susquehanna Coal Co., 220 N.Y. 259, 115 N.E. 915;
cf.
227 U.
S. Louis S.W. R. Co. v. Alexander, supra,
[
227 U.S.
218]."
". . . some of the decisions holding the corporation amenable to
suit have been supported by resort to the legal fiction that it has
given its consent to service and suit, consent being implied from
its presence in the state through the acts of its authorized
agents.
Lafayette Insurance Co. v.
French, 18 How. 404,
59 U. S.
407;
St. Clair v. Cox, supra,
106 U.S. [350,]
106 U. S. 356;
Commercial Mutual Accident Co. v. Davis,
supra, 213 U.S.
Page 342 U. S. 447
[245,]
213 U. S. 254;
Washington v. Superior Court, 289 U. S.
361,
289 U. S. 364-365. But, more
realistically, it may be said that those authorized acts were of
such a nature as to justify the fiction.
Smolik v. Philadelphia
& Reading Co., 222 F. 148, 151. Henderson, The Position of
Foreign Corporations in American Constitutional Law 94, 95."
". . . Whether due process is satisfied must depend, rather,
upon the quality and nature of the activity in relation to the fair
and orderly administration of the laws which it was the purpose of
the due process clause to insure. That clause does not contemplate
that a state may make binding a judgment
in personam
against an individual or corporate defendant with which the state
has no contacts, ties, or relations.
Cf. 95 U. S. Neff,
supra, [
95 U.S.
714];
Minnesota Commercial Assn. v. Benn, 261 U. S.
140."
It remains only to consider in more detail the issue of whether,
as a matter of federal due process, the business done in Ohio by
the respondent mining company was sufficiently substantial and of
such a nature as to permit Ohio to entertain a cause of action
against a foreign corporation where the cause of action arose from
activities entirely distinct from its activities in Ohio.
See
International Shoe Co. v. Washington, supra, at
326 U. S.
318.
The Ohio Court of Appeals summarized the evidence on the
subject. 88 Ohio App. at 119-125, 95 N.E.2d at 6-9. From that
summary, the following facts are substantially beyond controversy:
the company's mining properties were in the Philippine Islands. Its
operations there were completely halted during the occupation of
the Islands by the Japanese. During that interim, the president,
who was also the general manager and principal stockholder of the
company, returned to his home in Clermont County, Ohio. There, he
maintained an office in
Page 342 U. S. 448
which he conducted his personal affairs and did many things on
behalf of the company. He kept there office files of the company.
He carried on there correspondence relating to the business of the
company and to its employees. He drew and distributed there salary
checks on behalf of the company, both in his own favor as president
and in favor of two company secretaries who worked there with him.
He used and maintained in Clermont County, Ohio, two active bank
accounts carrying substantial balances of company funds. A bank in
Hamilton County, Ohio, acted as transfer agent for the stock of the
company. Several directors' meetings were held at his office or
home in Clermont County. From that office, he supervised policies
dealing with the rehabilitation of the corporation's properties in
the Philippines, and he dispatched funds to cover purchases of
machinery for such rehabilitation. Thus, he carried on in Ohio a
continuous and systematic supervision of the necessarily limited
wartime activities of the company. He there discharged his duties
as president and general manager, both during the occupation of the
company's properties by the Japanese and immediately thereafter.
While no mining properties in Ohio were owned or operated by the
company, many of its wartime activities were directed from Ohio and
were being given the personal attention of its president in that
State at the time he was served with summons. Consideration of the
circumstances which, under the law of Ohio, ultimately will
determine whether the courts of that State will choose to take
jurisdiction over the corporation is reserved for the courts of
that State. Without reaching that issue of state policy, we
conclude that, under the circumstances above recited, it would not
violate federal due process for Ohio either to take or decline
jurisdiction of the corporation in this proceeding. This relieves
the Ohio courts of the restriction relied upon in the opinion
Page 342 U. S. 449
accompanying the syllabus below, and which may have influenced
the judgment of the court below.
Accordingly, the judgment of the Supreme Court of Ohio is
vacated, and the cause is remanded to that court for further
proceedings in the light of this opinion. [
Footnote 7]
It is so ordered.
MR. JUSTICE BLACK concurs in the result.
[
Footnote 1]
See Perkins v. Perkins, 57 Phil.R. 205;
Harden v.
Benguet Consolidated Mining Co., 58 Phil.R. 141;
Perkins
v. Guaranty Trust Co., 274 N.Y. 250, 8 N.E.2d 849;
Perkins
v. Benguet Consolidated Mining Co., 55 Cal. App. 2d
720, 132 P.2d 70,
rehearing denied, 55 Cal. App. 2d
774, 132 P.2d 102,
cert. denied, 319 U.S. 774;
60 Cal. App. 2d
845, 141 P.2d 19,
cert. denied, 320 U.S. 803, 815;
Perkins v. First National Bank of Cincinnati, Com.Pl.,
Hamilton County, Ohio, 79 N.E.2d 159.
[
Footnote 2]
Ohio requires a foreign corporation to secure a license to
transact "business" in that State, Throckmorton's Ohio Code, 1940,
§ 8625-4, and to appoint a "designated agent" upon whom process may
be served, §§ 8625-2, 8625-5. The mining company has neither
secured such a license nor designated such an agent. While this may
make it subject to penalties and handicaps, this does not prevent
it from transacting business or being sued. § 8625-25. If it has a
"managing agent" in Ohio, service may be made upon him. § 11290.
Such service is a permissive alternative to service on the
corporation through its president or other chief officer. § 11288.
Lively v. Picton, 218 F. 401, 406-407. The evidence as to
the business activities of the corporation in Ohio is summarized by
the Ohio Court of Appeals. 88 Ohio App. 118, 119-125, 95 N.E.2d 5,
6-9. That court held that such activities did not constitute the
transaction of business referred to in the Code. In its syllabus,
however, the Supreme Court of Ohio, without passing upon the
sufficiency of such acts for the above statutory purpose, and
without defining its use of the term, affirmed the judgment
dismissing the complaint and assumed that what the corporation had
done in Ohio constituted "doing business" to an extent sufficient
to be recognized in reaching its decision.
[
Footnote 3]
In 1858, the Supreme Court of Ohio promulgated the following
rule:
"A syllabus of the points decided by the Court in each case
shall be stated, in writing, by the Judge assigned to deliver the
opinion of the Court, which shall be confined to the points of law,
arising from the facts of the case, that have been determined by
the Court. And the syllabus shall be submitted to the Judges
concurring therein for revisal, before publication thereof, and it
shall be inserted in the book of reports without alteration, unless
by the consent of the Judges concurring therein."
5 Ohio St. vii.
This policy has been recognized by statute. Bates Ohio R.S. §
427, as amended, 103 Ohio Laws 1913, § 1483, and 108 Ohio Laws
1919, § 1483. It appears now in Throckmorton's Ohio Code, 1940, §
1483, as follows:
"Whenever it has been thus decided to report a case for
publication, the syllabus thereof shall be prepared by the judge
delivering the opinion, and approved by a majority of the members
of the court, and the report may be per curiam, or if an opinion be
reported, the same shall be written in as brief and concise form as
may be consistent with a clear presentation of the law of the case.
. . . Only such cases as are hereafter reported in accordance with
the provisions of this section shall be recognized by and receive
the official sanction of any court within the state."
There are many references to this practice, both in the syllabi
and opinions written for the Supreme Court of Ohio. Typical of
these is the following:
"It has long been the rule of this court that the syllabus
contains the law of the case. It is the only part of the opinion
requiring the approval of all the members concurring in the
judgment. Where the judge writing an opinion discusses matters or
gives expression to his views on questions not contained in the
syllabus, it is merely the personal opinion of that judge."
State ex rel. Donahey v. Edmondson, 89 Ohio St. 93,
107-108, 105 N.E. 269, 273.
See also Williamson Heater Co. v. Radich, 128 Ohio St.
124, 190 N.E. 403;
Baltimore & O. R. Co. v. Baillie,
112 Ohio St. 567, 148 N.E. 233. A syllabus must be read in the
light of the facts in the case, even where brought out in the
accompanying opinion, rather than in the syllabus itself.
See
Williamson Heater Co. v. Radich, supra; Perkins v. Bright, 109
Ohio St. 14, 19-20, 141 N.E. 689, 690-691;
In re Poage, 87
Ohio St. 72, 82-83, 100 N.E. 125, 127-128.
[
Footnote 4]
"However, the doing of business in a state by a foreign
corporation, which has not appointed a statutory agent upon whom
service of process against the corporation can be made in that
state or otherwise consented to service of summons upon it in
actions brought in that state, will not make the corporation
subject to service of summons in an action
in personam
brought in the courts of that state to enforce a cause of action in
no way related to the business or activities of the corporation in
that state.
Old Wayne Mutual Life Assn. of Indianapolis v.
McDonough, 204 U. S. 8,
204 U. S.
22-23;
Simon v. Southern Ry. Co., 236 U. S.
115,
236 U. S. 129-130 and
236 U. S. 132.
See also
Pennsylvania Fire Ins. Co. of Philadelphia v. Gold Issue Mining
& Milling Co., 243 U. S. 93,
243 U. S.
95-96;
Robert Mitchell Furniture Co. v. Selden Breck
Construction Co., 257 U. S. 213,
257 U. S.
215-216;
International Shoe Co. v. Washington,
326 U. S.
310,
326 U. S. 319-320."
"An examination of the opinions of the Supreme Court of the
United States in the foregoing cases will clearly disclose that
service of summons in such an instance would be void as wanting in
due process of law."
155 Ohio St. 116, 119-120,
98 N.E.2d
33, 35.
[
Footnote 5]
". . . The obligation which is here sued upon arose out of those
very activities. It is evident that these operations establish
sufficient contacts or ties with the state of the forum to make it
reasonable and just, according to our traditional conception of
fair play and substantial justice, to permit the state to enforce
the obligations which appellant has incurred there. Hence, we
cannot say that the maintenance of the present suit in the
Washington involves an unreasonable or undue procedure."
International Shoe Co. v. Washington, supra, at
326 U. S.
320.
[
Footnote 6]
This citation does not disclose the significance of this
decision, but light is thrown upon it by the opinions of the state
court below.
Reynolds v. Missouri, K. & T. R. Co., 224
Mass. 379, 113 N.E. 413; 228 Mass. 584, 117 N.E. 913. In addition
to the cases cited in the text,
see Barrow S.S. Co. v.
Kane, 170 U. S. 100;
Pennsylvania Fire Insurance Co. v. Gold Issue Mining Co.,
243 U. S. 93
(statutory agent appointed);
Philadelphia & Reading R. Co.
v. McKibbin, 243 U. S. 264,
243 U. S.
268-269 (question left open).
[
Footnote 7]
For like procedure followed under somewhat comparable
circumstances,
see State Tax Comm'n v. Van Cott,
306 U. S. 511.
MR. JUSTICE MINTON, with whom THE CHIEF JUSTICE joins,
dissenting.
As I understand the practice in Ohio, the law as agreed to by
the court is stated in the syllabus. If an opinion is filed, it
expresses the views of the writer of the opinion and of those who
may join him as to why the law was so declared in the syllabus.
Judge Taft alone filed an opinion in the instant case.
The law as declared in the syllabus, which is the whole court
speaking, is clearly based upon adequate state grounds. Judge Taft,
in his opinion, expresses the view that the opinions of this Court
on due process grounds require the court to declare the law as
stated in the syllabus. As the majority opinion of this Court
points out, this is an erroneous view of this Court's
decisions.
"This brings the situation clearly within the settled rule
whereby this Court will not review a State court decision resting
on an adequate and independent nonfederal ground even though the
State court may have also summoned to its support an erroneous view
of federal law."
Radio Station WOW v. Johnson, 326 U.
S. 120,
326 U. S.
129.
The case of
State Tax Comm'n v. Van Cott, 306 U.
S. 511, is not this case. There, the case was not
clearly decided on an adequate state ground, but the state ground
and the federal ground were so interwoven that this Court was
"unable to conclude that the judgment rests upon an independent
interpretation of the state law." 306 U.S. at
306 U. S. 514.
In the instant case, a clear statement of the state law is made by
the court in the syllabus. Only Judge Taft has summoned the
erroneous view of this Court's decisions to his support of the
adequate state ground approved by the whole court.
What we are saying to Ohio is:
"You have decided this case on an adequate state ground, denying
service, which you had a right to do, but you don't have to do it
if you don't want to, as far as the decisions of this Court are
concerned."
I think what we are doing is giving gratuitously an advisory
opinion to the Ohio Supreme Court. I would dismiss the writ as
improvidently granted.