Craig v. Gunn , 67 Vt. 92 ( 1894 )

TYLER, J.

The principal parties were non-residents, and the trustee was a foreign corporation having its principal office and place of business in the city of New York, but operating lines of railroad extending from points in the state of New York to the city of Rutland in this state. It also owned and operated various lines of railroad situated wholly in the state of New York. The contract upon which the suit was brought 'was made in another state, and the sums due from the trustee to the defendant were wages for services rendered by the defendant for the trustee upon a line oí railroad lying wholly in the state of New York, under a contract of employment made in that state, and there payable.

Corporations are amenable to the trustee process like private persons, but this mode of attaching the personal property of a debtor in the hands of a third person is conferred only by statute; and S. 1073, R. L., provides that no person shall be summoned as a trustee unless at the time of the service of the writ he resides in this state. Citizens of another state, and subject to its laws and jurisdiction, are not within the jurisdiction of the courts of this state, and the “credits” in their hands have no situs here, and are no more attachable by this process than are the goods of a debtor situated in another state. Baxter v. Vincent, 6 Vt. 614 ; Pecks & Co. v. Barnum & Tr., 24 Vt. 75; Rindge v. Green, 52 Vt. 204.

In Nichols v. Hooper et al., 61 Vt. 295, the plaintiff and defendant resided in New York, and the debt that the plaintiff sought to recover and the one due the defendant from the trustee were contracted, and in law were payable, in that state. The trustee resided in this state and was held liable, so that case is decisive of every question that arises in the present one excepting the question of jurisdiction over the trustee upon the facts stated.

Gold et al. v. Housatonic R. Co., 1 Gray 424, arose under a statute like our R. L., s. 1072. The opinion of Shaw, C. J., is as follows :

“It is agreed that the defendants have leases of railroads in this county, and this would-make a strong case for charging them as trustees, if they could be chargeable as such under any circumstances. But the case of Danforth v. Penny, 3 Met. 564, is decisive, and shows that a foreign corporation cannot be so charged. By Rev. Sts.,c. 109, s. 6, ‘all corporations may be summoned as trustees.’ But what corporations? The very generality of the terms requires some qualification. It cannot be construed literally all corporations, in whatever part of the world established and transacting business. The answer is to be found in the statutes to. pari materia then existing. The statute in question was only an extension of an existing system. It was intended, we think, to put corporations on the same ground as individuals. And it is well settled that an individual, an inhabitant of another state, is not chargeable by the trustee process, although found in this commonwealth and here served with process. Tingley v. Bateman, 10 Mass. 343 ; Nye v. Liscombe, 21 Pick. 263. In the case of corporations, which have no local habitation, the principle is this r If established in this commonwealth by the laws thereof, they are inhabitants of this commonwealth within the meaning of the law; but if established only by the laws of another state, they are foreign corporations, and cannot be charged by the trustee process.”

This was the construction given a statute which contained no provision like our section 1073, that non-residents should not be subject to the trustee process. In 1870 the statute was amended so that non-residents, and corporations established by the laws of another state, might be summoned as trustees if they had a usual place of business in Massachusetts. In Larkin v. Wilson, 106 Mass. 129, the writ was served before the amendment to the former act was in force, and the court for that reason refused to hold a foreign corporation liable to the trustee process, and cited Danforth v. Penny, and Gold v. R. Co., supra, in support of the position that such a corporation was not liable to be summoned as a trustee, though it was the lessee of a railroad in that state, and its principal officers resided there and agents were employed there to manage the road.

In the later case of Bank of Commerce v. Huntington, 129 Mass. 444, it was held that a railroad corporation, created by the laws of another state, and having an office in Massachusetts for the convenience of its stockholders and for the better management of its finances and other business, where its principal officers were to be found, and where it carried on such business as is usually carried on in the office of the president and treasurer of a railroad corporation, had a usual place of business in that state within the meaning of the act of 1870, and might be summoned as trustee.

We have no statute like the Massachusetts Act of 1870, and even under that act this trustee process could not be maintained; for though it is presumable that the trustee had depots, freight houses, and agents in this state, it did not appear that it had any such office here as is described in the Massachusetts Act.

Drake on Attachment, s. 474, says :

“In this country the question has been repeatedly presented, and the uniform tenor of the adjudications establishes the doctrine that whether the defendant reside or not in the state in which the attachment is obtained, a nonresident cannot be subjected to garnishment there, unless, when garnished, he have in that state property of the defendant in his hands, or be bound to pay the defendant money, or to deliver to him goods, at some particular place in that state.”

It was said in Smith v. Insurance Co., 14 Allen 339 :

“A corporation being a mere creature of local statutes, can of right have no existence nor recognition beyond the limits of the state wherein it is established. By comity such artificial persons are permitted to contract and sue in other states. If they avail themselves of that comity * * * they may become liable to its jurisdiction to the extent to which they have thus voluntarily subjected themselves.”

This court held in Osborne & Woodbury v. Shawmut Ins. Co., 51 Vt. 278, that the defendant corporation was to be treated as a citizen of the state in which it was incorporated, and there being no attachment of property, jurisdiction could only be obtained by service of the writ upon the insurance commissioners of this state, and by a compliance by the defendant corporation with the statute which requires foreign insurance companies to agree that they may be sued in this state, which, as the court said in the case last cited, “is equivalent to an agreement that they may he found here for the service of process.”

The debt due from the trustee to the defendant of course had no situs in this state unless the trustee resided here within the meaning of our statute. It cannot be maintained that it did reside here. We find no occasion to depart from the decision in Towle v. Wilder & Tr., 57 Vt. 622, though no opinion was written in that case.

Judgment reversed, trustee discharged, and action dismissed.