Plaintiff is the indorsee of a note given to A. W. Stephens & Son, a corporation organized in New York, for the price of a threshing machine. The judgment below was for defendants.
It is not pretended that the corporation aforesaid ever complied with the laws of 1891, page 75, in relation to foreign corporations. It is provided by section 1 of that act that, “before it (the corporation) shall be authorized or permitted to transact business in this state,” it “shall have and
Corporation foreign: violation of statute void note. The foregoing provisions clearly demonstrate that the legislature intended that “before” a foreign corporation could transact business in this state, it should, as á condition preceding its right to do business, provide a public office or place to transact busi_i i t * i* , • . ness where legal service of summons, notice, etc., could be had in proceedings taken against them. It is furthermore apparent that the legislature intended a compliance with the law and a certificate thereof from the secretary of state, to be the authority whereby it might assume to act as a corporate body. If the corporation did not do so, it had no more authority to transact business in this state than if it had no corporate organization at all. It may not be inapt to say that the certificate of the secretary of state is a local incorporation. If it assumes to transact business in defiance of the law and takes to itself obligations, the courts of this state can not enforce them. Our law not
It is a familiar rule that a contract in furtherance of an act prohibited by statute is void, although not therein expressly declared to be void. Lawson on Cont., secs. 279, 280; Reese on Ultra Vires, sec. 69. Where the object of the statute is revenue a contract contrary to its provisions may not be void. 1 Wharton’s Conts., sec. 364. Such was the object of the law formally in this state as to insurance companies. Ins. Co. v. Walsh, 18 Mo. 229. “But when a statute imposes a penalty, not as a tax, but as a punishment, then a contract to do the thing on which the penalty is imposed is ordinarily unlawful; and so when the act is absqlutely prohibited. And when conditions on the exercise of a business are imposed in a statute for the maintenance of public order, or for the protection of parties, or on the grounds of public policy, then contracts' by such persons, in violation of the statute, are void.” 1 Wharton’s Conts., sec. 365. “A contract made in violation of a statute is void, unless the whole statute discloses an intention that it shall not be so.” Miller v. Ammon, 145 U. S. 421.
The statute in question has been before the St. Louis court of appeals in Williams v. Scullin, 59 Mo. App. 30, where it was held to invalidate a contract by a corporation which had not complied with the act. And so we held in Blevins v. Fairley, 71 Mo. App. 259, that a subsequent compliance with the statute could not validate a contract made before compliance.
Similar statutes, in other states, have been construed as invalidating contracts made by the corporation which had not complied with these provisions. Thorne v. Ins. Co.,
But the question of the validity of contracts in violation of a statute has also been before the supreme court of this state. Downing v. Ringer, 7 Mo. 585. There the only prohibition of the statute was a penalty affixed against anyone who should sell a town lot before a plat was made out and recorded. There the court quoted with approval as “the established modern doctrine” that “every contract made for or about any matter or thing which is prohibited, and made unlawful by any statute, is a void contract, though the statute itself does not mention that it shall be so, but only inflicts a penalty on the defaulter; because a penalty implies a prohibition, though there are no prohibiting words in the statute.” That case has been approved in Mason v. Pitt, 21 Mo. 391, and State ex rel. v. County Court, 72 Mo. 329, as well as by this court in Friend v. Porter, 50 Mo. App. 89. In this state the rule is announced in Downing v. Ringer, while the exception is stated in Ins. Co. v. Walsh, 18 Mo. 229, and Prince v. Baptist Church, 20 Mo. App. 332; these latter being revenue cases in which the prohibition is a mere means of collecting a tax or license. The statute we are considering enacts a state policy for the protection of its citizens. Contracts in violation thereof are void. Reese on Ultra Vires, secs. 69-72, and notes.
_.___. collateral attack. It is next insisted that if the act of transacting the business and taking the note was ultra vires, none other than the state can take advantage of it. This insistence must mean the foreign state, since such-state is the only- power which has created the offending corporation, or authorized it to do business. It can hardly be supposed that our law would be in such condition as to wait upon the action of some other state for a redress of the grievances of the citizens of this state. This state could not take any action to forfeit the charter of the offending corporation, or its right to do business, for it has not granted such chárter or such right. This state might, under the act aforesaid, proceed to enforce the penalty proscribed, but that would not meet the question, or be punishment meet, for the willful violation of a charter granted by the state. It might be the offending corporation would conclude, as is sometimes done in cases of other violators of law., that it would prefer to pay a penalty now and then, rather than cease the illegal business.
Rut aside from these considerations, the cases where it is held that the ultra vires act can not be attacked collaterally, and that the remedy is by a proceeding by the state to
__._. residents and non-residents: jury question. Lastly, it is contended that the business from which the note in question arose, was done by a traveling salesman or drummer. That this corporation is and was wholly nonresident and therefore the case falls within the exception to the law aforesaid, as has been adjudged in other cases. Blevins v. Fairley, 71 Mo. App. 259; Steam H. Co. v. Gas F. Co., 60 Mo. App. 148; Maxwell v. Edens, 65 Mo. App. 440; Davis & Rankin Co. v. Dix, 64 Fed. Rep. 412. But the trial court, upon evidence fully justifying it, submitted the question to the jury whether the corporation was an entire nonresident institution selling goods through traveling salesmen to be delivered from the foreign house; or, did it have a place of business in this state in charge of a local agent for the purpose of selling goods which were sent to such agent for the purpose of being thereafter sold to customers. If the former, the court directed the finding for plaintiff. If the latter, a verdict for defendant. This was a proper instruction, and, as we have stated, there was sufficient evidence to support it.
Our attention has been called to the case of Carson-Rand Co. v. Stern, 129 Mo. 381, in which it is held that though a foreign corporation had not complied with the statute aforesaid when it begun suit, yet if it did comply during the pend-ency of the action and before a motion to dismiss was acted
-:-: right of entry into state: statute.
We have already discussed the terms of the statute and have shown that it made it unlawful for foreign corporations to do business in this state before complying with the law. The entrance of foreign corporations into a state and settlement therein for the purpose of operating their business, is not a right possessed by such corporations. Admitting them is an act of grace. The state receiving them may prescribe any conditions it sees proper. Bank v. Earle, 13 Pet. 586; Paul v. Virginia, 8 Wall. 168. The most effective way to compel obedience to conditions of admission is to make their contracts unlawful and void. That mode is unerring in its results. It removes all incentive to come until after compliance with the law. If they be prohibited
The judgment should be affirmed.