Opinion
Hearing Granted July 30, 1942.
Appeal from Superior Court, Los Angeles County; Kurtz Kauffman, Judge pro tem.
Suit by Maude H. Hunstock, individually and as trustee, etc., against Estate Development Company, wherein the defendant appeared specially and moved to quash service of summons and complaint. From a judgment by default in favor of plaintiff, the defendant appeals.
Reversed with directions. COUNSEL
Dryer, Richards & Page, of Los Angeles, for appellant.
Crail, Crail & Crail, of Los Angeles, for respondent.
OPINION
HANSON, Justice pro tem.
The principal if not the most important and controlling question in this case is whether summons directed to a domestic corporation, which the court ordered delivered to the secretary of state in lieu of service thereof on the defendant corporation, constituted a valid personal service on the corporation where it was mailed to the secretary of state instead of being personally served upon him or any person employed in his office in the capacity of assistant or deputy. A further question is whether, in view of the showing that was made as to plaintiff’s inability to serve process on the corporation or a statutory designated agent, the court was authorized to make an order providing for substituted service on it.
The verified return of service filed in the case below disclosed that the summons had been mailed to the secretary of state. Annexed to the return and referred to therein was a letter from the assistant secretary of state stating that the summons had been received through the mail and that he had transmitted it by mail to the corporation at its principal office in this state. Upon the showing thus made, which additionally disclosed that the process had been received by the assistant secretary of state more than thirty days prior thereto, the presiding judge signed a default entry against the corporation. In this entry the court recited that the defendant corporation had been duly served with summons "by delivering to the secretary of state of the state of California one copy of the summons and complaint pursuant to order of the court under section 373 of the Civil Code, and [the defendant] having failed to answer the plaintiff’s complaint herein, and the time for answering having expired, the default of the defendant is hereby entered according to law." About twenty-seven months thereafter--and why plaintiff did not sooner seek a default judgment is not shown by the record--the defendant corporation duly served upon the plaintiff and filed in the cause its "notice of special appearance and motion to quash service of summons and complaint," setting forth as grounds therefor, first, that service of summons was not made in accordance with the court order nor was it delivered to the secretary of state or to any person employed in his office in the capacity of assistant or deputy, and, second, that an insufficient showing had been made by affidavit to warrant substituted service.
While the affidavit for substituted service stated the efforts that had been made to serve the president and the secretary of the corporation without success, it did not state that the corporation did not have a head other than the president, a vice-president, an assistant secretary or a general manager, or, except for a statement to that effect in a letter from the secretary of state, that the corporation had not filed with the secretary of state a designation of a natural person residing in this state for the purpose of service of process or authorized to receive service of process, or that with the exercise of due diligence none of such officers or agent could be served with process directed to the corporation.
The motion to quash service was limited to the jurisdictional grounds mentioned and sought no relief as to the merits. The motion being denied and defendant corporation having failed to proceed further in the court below, a judgment of default was rendered against it. Thereafter it took the present appeal from the judgment by default, assigning as the only ground of error that the court was without jurisdiction over the person of defendant to render the judgment in question.
That a state may by statute provide for substituted or constructive service on persons or corporations subject to its jurisdiction, where it adheres to the requirements of due process under the state and federal constitutions, is no longer debatable. But under the requirements of due process it is essential that the court have jurisdiction over the person and that the defendant receive reasonable and appropriate notice. Milliken v. Meyer, 311 U.S. 457, 61 S.Ct. 339, 85 L.Ed. 278, 132 A.L.R. 1357. It is not only fundamental law but the essence of natural justice that a court may not adjudicate upon the rights or duties of a person unless he is given an opportunity to be heard after the service of process is had upon him or his duly constituted agent, or his waiver thereof in writing or by personal appearance. While under the state or federal constitution there is no provision in express words which requires that initial original process shall be served personally upon the defendant, his agent or the person substituted for him by statute, whether the action is in personam or in rem, nevertheless it is well established that a statute which authorizes substitute or constructive process against a resident who can with proper diligence be served personally is not due process. Bardwell v. Anderson, 44 Minn. 97, 46 N.W. 315, 9 L.R.A. 152, 20 Am.St.Rep. 547; per Mitchell, J.; Piggly-Wiggly, etc., Co. v. May Investing Corp., 189 Ga. 477, 6 S.E.2d 579, 128 A.L.R. 1465; Webster v. Reid, 11 How. 437, 13 L.Ed. 761; McDonald v. Mabee, 243 U.S. 90, 37 S.Ct. 343, 61 L.Ed. 608, L.R.A.1917F, 458. In the Webster case the state statute expressly provided that the resident defendants might be served merely by publication in a newspaper; in the McDonald case the statute provided that a citizen absent from the state was amenable to process published in a newspaper. In both cases it was held the statutes did not accord with due process. The only exception to the rule which has been sustained involved an action instituted in a small claims court where the jurisdiction was limited to cases involving fifty dollars or less. Even in that case it was held that nothing short of the signature of the defendant on a registry return receipt of a registered letter enclosing the process was sufficient. Wise v. Herzog, 72 App.D.C. 335, 114 F.2d 486. Such signature, it may be noted, is analogous to a signed acknowledgment of process, except that the recipient does not necessarily know at the time he signs that process is being delivered to him. Under our statute a summons must be directed to the defendant, signed by the proper official, issued under seal of the court (Code Civ.Proc. § 407) and served upon the defendant. At the same time a copy of the summons together with a copy of the complaint must be "delivered" in the following manner: "1. If the suit is against a domestic corporation: to the president or other head of the corporation, a vice president, a secretary, an assistant secretary, general manager, or a person designated for service of process or authorized to receive service of process. * * * If no such officer or agent of the corporation can be found within the state after diligent search, then to the secretary of state as provided in section 373 of the Civil Code. * * * 7. In all other cases to the defendant personally." Code Civ.Proc., § § 410, 411. (Italics ours.)
Civil Code section 373 referred to in the foregoing statute provides that a domestic corporation may file with the secretary of state its designation of a natural person as its agent for the purpose of service of process, and that delivery of a copy of process to such agent, if directed to the corporation, shall constitute valid service on such corporation. If such a designation is not filed, and it appears by affidavit to the satisfaction of the court or a judge thereof that personal service of process against such corporation cannot be made in the exercise of due diligence upon its officers or agents (of the character named in section 407 of the Code of Civ.Proc.), the "court or judge may make an order that the service be made upon such corporation by delivering to the Secretary of State, or to any person employed in his office in the capacity of assistant or deputy, one copy of such process for each defendant to be served. Service in such manner shall be and constitute personal service [for the purpose of the statute] upon such corporation." (Italics ours.) The statute then proceeds to provide that after such delivery of process to the Secretary of State he in turn shall give the corporation notice of the service upon him by mailing a copy to it; that thereafter the corporation shall be required to appear and answer within thirty days after delivery of such service to the Secretary of State, and that the secretary "shall keep a record of all process served upon him under this title." While the statute excepts certain corporations from the provisions thereof, the corporation here involved is not one of them.
In view of the requirements of the statutes just quoted, the problem is whether mailing the process to the Secretary of State, rather than a delivery by hand, is sufficient to meet the requirements of Civil Code section 373. It will be observed that the phrase as there used provides that the court or judge may "order that the service be made upon such corporation by delivering to the Secretary of State, or to any person employed in his office in the capacity of assistant or deputy," the requisite copies of the process. The solution of the problem rests not merely upon the phraseology used but it is to be ascertained in the light of the background of the process statutes, the common law and the requirements of due process.
Our basic statute (Code Civ.Proc., § 411) with respect to service of summons upon an individual, corporation or other entity provides: "The summons must be served by delivering a copy thereof * * *." Similarly, Civil Code section 373, as has been noted, provides that "service [is to] be made * * * by delivering to the Secretary of State, or to any person employed in his office in the capacity of assistant or deputy, one copy of such process." In either case service, in the language of the two statutes, is attained by delivering a copy of the process. What, then, is meant by or encompassed in the use of the word "delivering," or the phrase "served by delivering"? That the phrase in section 411 of the Code of Civil Procedure reading, "served by delivering a copy," means a delivery of the process by the hand of the process server to the person personally to be served has never been doubted. Moreover, it means more than that. It means that the defendant or his agent at the time that he receives the process by hand must be adequately apprised by the process server that the act of delivery involves the service of process. Generally, this may be done by reading the original process or offering to do so, or in a word or two stating the nature of the paper delivered. But delivery of process is not made under the law by surreptitiously placing it in the recipient’s pocket, touching his person with it or even handing it to him without comment. Anderson v. Abeel, 96 A.D. 370, 89 N.Y.S. 254. In the law, "service" of process has always meant its judicial delivery to a party so as to charge him with its receipt and subject him to its legal effect. Walker v. State, 52 Ala. 192, 193. "Service means serving the defendant with a copy of the process, and showing him the original if he desires it." Baron Alderson in Goggs v. Lord Huntington, 12 Mees & W. 503. In Rathbun v. Acker, 18 Barb., N.Y., 393, it was held that when a statute or ordinance requires "service" on a person it means personal service, unless some other service is specified or indicated. Accordingly, a notice mailed and received by a party, all within the territorial jurisdiction of the court, was held not a compliance with the statute.
As it is clear that under our basic statute (§ 411, supra) the word "delivering" requires that summons be handed to the recipient and that he be apprised as to what is involved in the act of delivering the process, it is not apparent why the similar provision in the statute with reference to delivering process to the Secretary of State may be interpreted differently, or indeed as permitting a mere mailing of process to him when this may not be done under the basic statute. Accordingly, when the Legislature in 1931 enacted Civil Code section 373 and provided therein that a domestic corporation under the conditions named might be served with process by "delivering" it to the Secretary of State or certain of his employees, it knew, or as a matter of law was deemed to know, when it used the word "delivering," that it had attained a special meaning all its own in the law, and that anything short of the service contemplated by Code of Civil Procedure section 411, such as by mailing, was insufficient. General dictionary definitions of "delivery" are not apropos, because since the beginning of the common law "delivery" of process has meant not only manual personal delivery, but a statement to the effect that service of process is intended by the act of delivery. Moreover, it is clear that the Legislature fully understood that "delivery" of summons implied a personal hand delivery. This is indicated by the fact that it affirm-atively differentiated between the words "delivery" and "mailing" when it provided that summons should be "delivered" to the Secretary of State but that the secretary in turn was authorized to "mail," rather than "deliver," the documents to the corporation involved, and in providing that the secretary should keep a record of the process served upon him. Moreover, there would appear to be no point in restricting delivery to officials named in the secretary’s office if mailing was contemplated. Accordingly it is manifest that mailing the process to the Secretary of State did not comply either with the statute or with the order of the court.
The fact, if it be a fact, that the Secretary of State received the summons and complaint and that the corporation or an official of it in turn received these documents from the office of the Secretary of State, if that be a fact, is of no legal significance. If, for example, a defendant not served with process should order a certified copy of the process from the clerk of court or should request through his counsel from counsel for plaintiff a copy of process, there would in each case be a delivery in the ordinary acceptation of the word, but not the necessary intent involved in making service. So far as the Secretary of State was concerned, he was without power to waive the manner of service or to accept service in behalf of the corporation. Farmer v. National Life Ass’n, C.C., 50 F. 829. The statute requires manual personal service of the process coincident with its delivery, and nothing short of that kind of service is adequate to require the corporation to appear in response to the summons, even though it received such summons through the mail from the Secretary of State. While Code Civil Procedure section 411 expressly provides that a "defendant" may accept service, it necessarily implies that no one may accept for him without express authorization from him. The Secretary of State was not a defendant nor expressly authorized by the defendant to accept process for it; nor does the statute authorize him to do so. Hence the mere statement of the Secretary of State to counsel for plaintiff that the papers had been received was not an acknowledgment that service of process had been made upon the secretary, his assistant or deputy, nor was it a waiver of the necessity thereof. This much is conceded by respondent and so calls for no further discussion.
The fact that personal service on the Secretary of State, his assistant or deputy in a case such as this may involve needless expense, such as the payment of a fee to a process server or the sheriff at Sacramento, and may serve no important purpose, does not permit us by construction to judicially legislate accordingly, if we were so inclined--and we are not. If the Legislature wishes to amend the statute so as to provide that mailing of process direct to the Secretary of State rather than a delivery of process to him, or either, or his acceptance of process, shall be sufficient, the matter is within its province, not ours, subject to the provisions of the constitutions, state and federal. So far the Legislature has not attempted any such procedure, and it will be time enough when it does to determine the validity thereof.
In view of what has been said it is unnecessary to determine whether the affidavits filed were sufficient to warrant the order which the court below made permitting service upon the Secretary of State.
Respondent, however, seems to suggest that the appeal may not be entertained because appellant’s remedy was to have moved to set the default aside after the court below ruled against it, and that had it taken that procedure it could have had its day in court and so may not now complain that it did not have it. While respondent submits no argument to sustain any such contention, we assume his theory is that an appeal waives a special appearance and that the error of the court in overruling it may be challenged only by a petition for a writ of prohibition and not by an appeal; and, even if it may be challenged here, that the defendant on a reversal is in court for further proceedings. While we see no merit in any such viewpoint, it is necessary in connection with our disposition of the appeal that we point out in some detail the fallacy of the argument.
In the early stages of the law any appearance by the defendant in a court proceeding was deemed a general appearance and a waiver of service of process upon him or of any irregularities in connection therewith. Accordingly for a defendant to preserve his claim that the court was without jurisdiction over him it was not only necessary for him to stay out of the trial court but he had to await the entry of judgment against him and then seek a review by writ of error or appeal, or institute an action for cancellation of the judgment or defend against its enforcement. Aside from any injury sustained to his credit by entry of the judgment, the defendant ran the risk, where he did not defend on the merits, that the reviewing court might rule against him on the jurisdictional point and thereby leave him with an adverse judgment against him even though he had a good defense to it on the merits. To obviate the rule so as to permit the defendant to challenge the jurisdiction and still defend on the merits, if the challenge to jurisdiction was overruled, the courts invented the "special appearance." Under it the defendant was permitted to make and to preserve his challenge to the jurisdiction without a waiver by an appearance, so long as he limited his challenge simply to that of the court’s jurisdiction over him. Cf. Sunderland, Preserving a Special Appearance, 9 Mich.L.Rev. 396. Initially an appeal or writ of error seeking to review the jurisdiction of the trial court over the person was not a waiver of the special appearance for any purpose. The Supreme Court of this state in 1857, in Deidesheimer v. Brown, 8 Cal. 339, took the logical view, and upon sustaining the appeal for want of jurisdiction in the court below directed the trial court to dismiss the case.
The principle that the taking of an appeal is not a waiver of process was followed in Lyman v. Milton, 44 Cal. 630, and Kent v. West, 50 Cal. 185, the latter of which directed the trial court to set aside the service of summons. However, in Desmond v. Superior Court, 59 Cal. 274, without referring to its cases just mentioned or to any other precedent and without suggesting any reason, the Supreme Court departed so far from the basis of the rule, in a collateral direction, so as to hold that a special appearance attacking the jurisdiction of the trial court was waived by going to trial on the merits. This has been the rule in this jurisdiction ever since, and was reaffirmed only a few weeks ago in Raps v. Raps, 20 Cal.2d 382, 125 P.2d 826. However, it has never been held by the courts of this state that the mere taking of an appeal converts a special appearance into a general appearance, or that upon a reversal for want of jurisdiction over the person the trial court is vested with jurisdiction over the person of the appealing defendant, either retroactively or as to future proceedings, without further service of process. See Steinbach v. Leese, 27 Cal. 295. On principle it would seem that an adjudication by the reviewing court that the trial court was without jurisdiction over the person may not by any process of reasoning be converted into saying it has jurisdiction then or thereafter, without service of process.
As was said by Brandeis, J., in speaking to the point in Bank of Jasper v. First National Bank, 258 U.S. 112, 42 S.Ct. 202, 204, 66 L.Ed. 490: "It certainly may not be assumed that the Legislature [in permitting an appeal from an order overruling a challenge to the jurisdiction of the court over the person] intended that exercise of the right conferred should operate as a general appearance [in the trial court after an affirmance], and thus render moot a consideration of the ruling alone sought to be reviewed." Or, as it was said in Miner v. Francis, 3 N.D. 549, 58 N.W. 343, 345: "We are at a loss to discover how the act of invoking the jurisdiction of an appellate court to correct an error in the proceedings can be construed as a waiver of such error." It often happens that, upon the trial of an action, reversible error is committed by the court while the plaintiff is proving his case. Must the defendant then be regarded as waiving such error because he proceeds, with the chance of reversal if defeated? It is well to put the responsibility for this condition where it belongs.
While it is true that the Code of Civil Procedure (§ § 350 and 1049) provides that an action shall be deemed pending from the time of filing the complaint until its final determination upon appeal, or until the time for appeal has passed unless the judgment is sooner satisfied, yet a judgment is not vacated by an appeal, and, if it be a money judgment, execution may issue in the absence of supersedeas. Speaking generally, the judgment is final so far as the trial court is concerned even though it is not a final determination of the rights of the parties pending its review on appeal. For that reason, and that alone, it is not admissible in evidence to sustain an action upon it or in support of a defense in another action. Moreover, an appeal from a judgment, whether at law or in equity, is a review only as to alleged errors of fact or law and is in no sense a trial de novo. Accordingly, while an appeal in this state is often classed as being in effect a mere continuation of the action below, as it is not a new suit, yet it is a direct attack on the judgment below and so is more like a writ of error than an appeal in chancery. Sharon v. Hill, C.C., 26 F. 337; 2 Cal.Jur., § 3. A writ of error at common law is regarded by the federal courts as a continuance of the original action rather than the commencement of a new proceeding. Cohens v. Virginia, 6 Wheat. 264, 410, 5 L.Ed. 256, 257; Nations v. Johnson, 24 How. 195, 204, 16 L.Ed. 628; Benker v. Meyer, 8 Cir., 154 F. 290, 83 C.C.A. 270. While our cases have often said that an appellant by virtue of his appeal submits to the jurisdiction of the court below as to any future proceedings in that court after a reversal, the statement is too broad. Where a defendant has appeared specially below for the single purpose of objecting to the jurisdiction of the court over him as a party defendant, and where his appeal is confined to that one question, the court below does not on reversal obtain jurisdiction over him without further service of process. Clark v. Forbes, 34 Cal.App. 524, 168 P. 155. See also 4 C.J.S., Appeal and Error, § § 109 & 112.
The view held by a small minority of the courts that one who is named as a party to a suit and is made an apparent party to the judgment may not appeal from it where he has not been served with process or has not appeared generally is without merit. Estate of Meade, 5 Cal. Unrep. 678, 49 P. 5; Hansen v. Klicka, 78 Ill.App. 177; Tuttle v. Claflin, 2 Cir., 88 F. 122, 31 C.C.A. 419. Our statute (Code Civ.Proc. § 938) provides that any party aggrieved may appeal. Where the plaintiff (respondent), as here, contends, and the trial court holds, that the defendant was a party and the judgment rendered purports to divest appellant of its property, it seems clear that the statute may not be construed as excluding appellant from a right of appeal. In this state, unlike in many other states, the right of appeal is not a matter of grace within the keeping of the Legislature. The right here is granted by the Constitution, and may be supplied by the Supreme Court where legislation is inadequate, or even if the Legislature should seek to abolish the right. Const., art. VI, § 4; Estate of Nelson, 128 Cal. 242, 60 P. 772. Moreover, neither the Legislature nor the courts may trammel the right of appeal in view of the provisions of our Constitution. Cases such as Braun v. Brown, 13 Cal.2d 130, 87 P.2d 1009; San Francisco, etc., Asylum v. Superior Court, 116 Cal. 443, 48 P. 379, and McDonald v. Cutter, 120 Cal. 44, 52 P. 120, do not rule contrary to anything we have said. General language in those cases not necessary to the decisions may not be regarded.
The argument that a petition for prohibition is the sole method afforded to a defendant who wishes to review an order entered on his special appearance adjudging the court has jurisdiction over his person is not sustained by Jardine v. Superior Court, 213 Cal. 301, 2 P.2d 756, 79 A.L.R. 291. In fact, that case recognizes that the remedy of appeal exists, but that where it is shown the remedy is inadequate a writ of prohibition may and should issue. But the case makes it plain that prohibition will not be granted solely because a defendant waives the point of jurisdiction by pleading to the merits. While we think the court indicated rather plainly that it regarded that particular rule as unfortunate, it did not intimate it would be overruled when the point came squarely before it. Its recent decision in Raps v. Raps, supra, would seem clearly to foreshadow it has no thought of doing so. It is enough for us to say on this point that the appellant was not required to petition for prohibition and did not waive its right to take an appeal by having failed to do so.
As the court below was without jurisdiction to enter a default or to render a default judgment, the judgment rendered is a nullity and the motion to quash the purported service of summons should have been sustained.
The judgment is reversed with directions to dismiss the action against the appellant.
McCOMB, J., concurred.
W. J. WOOD, Acting Presiding Justice (dissenting).
I dissent. No claim is made that the Secretary of State did not receive the process or that defendant corporation did not receive the process when it was mailed by the Secretary of State pursuant to the provisions of section 373 of the Civil Code. No claim is made that the corporation has suffered any injury whatever. Under section 373 mailing by the Secretary of State to the party in interest is sufficient. In my opinion there is no justification for requiring manual delivery to the Secretary of State.
It is an established rule of statutory interpretation that words and phrases are to be construed according to the approved usage of the language, and that words of common use are to be taken in their ordinary and general sense. Corbett v. State Board of Control, 188 Cal. 289, 291, 204 P. 823; § 16, Code of Civil Procedure. Statutes should be interpreted "in the light of reason and common sense". Great Western, etc., Co. v. John A. Wathen D. Co., 10 Cal.2d 442, 446, 74 P.2d 745, 746. The word "deliver" is a word of common use and its ordinary meaning is very different from "personal service". If, as has been contended, the members of the Legislature who enacted section 373 are deemed to have had knowledge of the decisions of the tribunals of the state on the subject of the service of process, they are deemed to have been familiar with the statements of the court in Heinlen v. Heilbron, 94 Cal. 636, 640, 30 P. 8, 9: "The ‘delivery’ which constitutes a personal service under section 1011 need not be made by the individual who is attempting to make the service, but can be effected through a clerk or messenger, or through any agency by which a ‘delivery’ can be made; and when the notice is so delivered the service becomes a personal service. The fact that the person upon whom the service is to be made resides or has his office in a different place from that of the person making the service, does not require that the service be made by mail, or preclude a personal service, and the person seeking to make the service can avail himself of any agency,--such as Wells, Fargo & Co., or the instrumentality of the post office department,--with as much effect as if he had employed any other messenger. The delivery of the notice through such agency renders the service personal, and the proof of such delivery establishes a personal service." The Heinlen case was cited with approval in Colyear v. Tobriner, 7 Cal.2d 735, 743, 62 P.2d 741, 745, 109 A.L.R. 191, where the court held that notice of termination of tenancy required personal service and that "the post office department, as well as any other type of messenger, may be used to effect personal service."