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BOTWINICK v. CREDIT EXCHANGE (09/29/65)

decided: September 29, 1965.

BOTWINICK
v.
CREDIT EXCHANGE, INC., APPELLANT



Appeal from order of Court of Common Pleas No. 3 of Philadelphia County, Dec. T., 1963, No. 729, in case of Gerald Botwinick v. Credit Exchange, Inc.

COUNSEL

Jerome J. Shestack, with him Ira P. Tiger, and Schnader, Harrison, Segal & Lewis, for appellant.

Michael F. Walsh, with him Leonard Spear, and Meranze, Katz, Spear & Bielitsky, for appellee.

Bell, C. J., Musmanno, Jones, Cohen, Eagen, O'Brien and Roberts, JJ. Opinion by Mr. Justice Jones.

Author: Jones

[ 419 Pa. Page 66]

The sole issue on this appeal is the validity of the service of a complaint in trespass in Philadelphia upon a foreign corporation.

Gerald Botwinick, on December 13, 1963, instituted a trespass action in Court of Common Pleas No. 3 of Philadelphia County against Credit Exchange, Inc., a New York corporation (the New York corporation), wherein Botwinick sought damages for an alleged business libel by the New York corporation. On December 27th, 1963, a deputy sheriff of Philadelphia County purported to serve the complaint in Philadelphia upon the New York corporation. The sheriff's return of service recited that a true and attested copy of the complaint had been served on one Mr. DiVitto*fn1 "the clerk for the time being in charge of [the New York corporation's] usual place of business at 1218 Chestnut St., in the County of Philadelphia . . . ."

The New York corporation filed preliminary objections on the ground that the court lacked jurisdiction over the person of the New York corporation inasmuch as 1218 Chestnut St., Philadelphia, was not "the usual place of business" of the New York corporation, but rather was the "the usual place of business" of Credit Exchange of Pennsylvania, Inc., a Pennsylvania corporation (the Pennsylvania corporation), which, although a subsidiary of the New York corporation, was not a defendant in the trespass action. In support of its preliminary objections, the New York corporation submitted an affidavit by its executive vice-president setting forth that the New York corporation was organized in New York, was not licensed nor registered to do

[ 419 Pa. Page 67]

    business in Pennsylvania, had never filed tax returns nor paid taxes in Pennsylvania, owned the capital stock of the Pennsylvania corporation, but did not operate or control the latter's business, filed state and federal taxes separately from its subsidiary, maintained separate minutes and bank accounts and conducted separate meetings, all outside of Pennsylvania.

On April 1, 1964, Judge R. P. Alexander entered an order sustaining the preliminary objections and holding that the court lacked jurisdiction over the New York corporation. Approximately one week later, Judge Alexander issued another order, accompanied by a memorandum opinion, vacating the order of April 1, 1964, and giving Botwinick "leave to schedule depositions or otherwise attempt to support its position relative to the jurisdiction of the court in this case" and further directing that the preliminary objections be continued for argument pending the taking of such depositions. Thereafter, Botwinick took the deposition of one Herbert Janis, manager of the Pennsylvania corporation. On January 7, 1965, Judge Weinrott entered an order dismissing the preliminary objections. From this order the present appeal was taken.

In his opinion, inter alia, Judge Weinrott noted: ". . . [T]he testimony of the credit manager [Janis] establishes ample activity and interaction between the companies [i.e., the New York corporation and the Pennsylvania corporation] to warrant and justify the claim of jurisdiction and a finding that the New ...


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