Henry R. Jahn & Son, Inc. v. Superior Court of San Mateo County , 49 Cal. 2d 855 ( 1958 )

SCHAUER, J.,

Dissenting.—From the record in this case the following facts appear: Petitioner has at no time maintained any offices in California, or made any sales or sales solicitations here. It is the exclusive export agent for American Drying Systems, Inc. (real party in interest), and also the agent for one other California manufacturer. Petitioner places its orders for purchase of the products of these two manufacturers by mail or telephone from New York, and, although the course of purchases is regular, no purchase orders are placed from California. The goods are shipped f.o.b. California, are packaged for shipping in California, and are shipped by the manufacturers to a general forwarding company in California. The forwarding company is selected by petitioner, and receives its shipping instructions directly from petitioner. On two occasions, when the orders were rather large, petitioner sent one of its auditors to California with the check for payment, and he ascertained that the order was properly filled before making payment. Petitioner has apparently had no contacts with California other than those just mentioned.

In the light of the basic facts it appears that in holding that petitioner was “doing business in this State” so as to subject it to service of process pursuant to section 6501 of the Corporations Code, the majority opinion indicates a trend toward, if not implicitly an actual, holding that all persons residing and doing business outside California but who place orders by telephone or correspondence for goods in this state and who arrange (as they must, if the orders are to be filled) for packing, shipping and delivery of the goods so purchased, will thereby become subject to the jurisdiction of California courts and subject to suit in this state. Such a holding seems especially unfortunate and undesirable, particularly for the manufacturers and producers of California, as it must inevitably tend to deter those who are in the market for California products from sending to this state for them. It is a matter of common knowledge that efforts are constantly being made by the various states on both a governmental and a private industry level to attract additional industry and commerce, and I believe that where, as here, the law is at least equally open to a contrary ruling, the court should not choose the course which will be detrimental to the interests of California.

I would grant the peremptory writ.