Pennsylvania Fire Insurance v. Gold Issue Mining & Milling Co.
243 US 93, 1917 U.S. LEXIS 2097, 37 S. Ct. 344 (1917)
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Rule of Law:
When a foreign corporation, in order to obtain a license to do business in a state, voluntarily executes a power of attorney appointing a state official as its agent for service of process, it has expressly consented to that state's jurisdiction for any lawsuit, even those arising from transactions outside the state.
Facts:
- An insurance company sought and obtained a license to conduct business in Missouri.
- To receive the license, the insurance company filed a power of attorney with the Missouri Superintendent of the Insurance Department.
- This document consented that service of process upon the superintendent would constitute personal service upon the company for as long as it had liabilities in the state.
- The insurance company issued an insurance policy in Colorado to an Arizona corporation.
- The policy insured buildings that were located in Colorado.
Procedural Posture:
- The Arizona corporation filed suit against the insurance company in a Missouri state court on the Colorado insurance policy.
- Service of process was effected by serving the Missouri Superintendent of the Insurance Department.
- The insurance company moved to dismiss, arguing that service was improper for a suit based on an out-of-state contract and that exercising jurisdiction violated the Due Process Clause.
- The Supreme Court of Missouri affirmed the trial court's jurisdiction, holding the state statute applied and was constitutional.
- The insurance company, as plaintiff in error, appealed the decision to the U.S. Supreme Court.
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Issue:
Does a state statute, which is interpreted to allow a foreign corporation to be sued on a cause of action arising in another state after it has appointed an in-state agent for service of process, violate the Due Process Clause of the Fourteenth Amendment?
Opinions:
Majority - Mr. Justice Holmes
No, the state statute does not violate the Due Process Clause. When a corporation voluntarily appoints an agent for service of process, it expressly consents to the jurisdiction of that state's courts. The insurance company's execution of the power of attorney was a voluntary act, and it thereby took the risk of how the courts would interpret the scope of that consent. This situation is distinct from cases where jurisdiction is based on implied consent derived from a corporation doing business in a state without authorization; in those cases, jurisdiction is limited to in-state activities. Here, the consent was actual and express, not a legal fiction, and therefore can extend to transitory causes of action arising outside the state.
Analysis:
This decision establishes a crucial distinction between express consent and implied consent as bases for personal jurisdiction over foreign corporations. By finding that a formal appointment of an agent for service constitutes express consent to general personal jurisdiction, the Court significantly broadened the power of states over corporations they license. This ruling reinforced the idea that constitutional protections like due process can be waived through voluntary corporate acts. While later superseded by the 'minimum contacts' framework of International Shoe, this case was a key development in the evolution of jurisdictional jurisprudence based on corporate presence and consent.
