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M & N MEAT CO. v. AMERICAN BONELESS BEEF CORP.

August 28, 1974

M & N MEAT COMPANY, a corporation, t/d/b/a M & N Meat Company, a corporation, Plaintiff,
v.
AMERICAN BONELESS BEEF CORPORATION, a corporation, Defendant


Snyder, District Judge.


The opinion of the court was delivered by: SNYDER

SNYDER, District Judge.

 This Court is called upon to decide in a diversity case, the meaning and application of the Pennsylvania "Long Arm" Statute (Act of November 15, 1972, effective 90 days thereafter, 42 Pa. S. § 8301 et seq.) in a factual situation not heretofore acted upon by the Pennsylvania Supreme Court. A default judgment had been entered for the Plaintiff which this Court set aside by an Order entered May 2, 1974.

 From the Affidavits as filed and after an Evidentiary Hearing, we determine that Hess-Stephenson Co., a meat broker in Chicago, contacted American Boneless Beef Corporation (American) in Massachusetts by telephone to determine if certain beef, then in New York, was for sale. Finding that it was, Hess-Stephenson telephoned M & N Meat Company (M & N) in Pittsburgh and confirmation was given. American delivered the first portion of the order and was paid the sum of $19,080.00. The remaining portion of the order was not delivered, and it is for damages due to American's failure to make such delivery that this action is brought.

 Service of the Complaint upon American was accomplished by (1) sending a copy to the Secretary of the Commonwealth, and (2) by sending a copy by certified mail to American's place of business in Massachusetts, allegedly pursuant to 42 Pa. S. § 8307. *fn1" This latter mailing was returned "unclaimed". M & N then caused a judgment by default to be entered in the sum of $32,000.00, with interest at 6% per annum and costs, and the attorney for M & N notified American of the entry of the judgment and demanded payment. American promptly filed a "Motion to Set Aside the Entry of Default and for Stay of Proceedings to Enforce Judgment" on the ground that this Court lacked jurisdiction over its person, and thus, the judgment was invalid by reason of defective service. This Court granted a stay of execution on the judgment and judgment was subsequently vacated on the grounds of "mistake or excusable neglect" under Rule 60(b) of the Federal Rules of Civil Procedure. American then filed a "Motion to Dismiss" alleging that it was and is not subject to the jurisdiction of this Court.

 American filed with this Motion an Affidavit of a corporate officer setting forth that American had not performed any act in the Commonwealth of Pennsylvania for the purpose of realizing pecuniary gain or with the intention of initiating a series of such acts; had not shipped any merchandise, directly or indirectly, in or through the Commonwealth of Pennsylvania; was not now and never had been engaged in any business within the Commonwealth of Pennsylvania; and did not now and never had owned, used or possessed any real property situate within the Commonwealth of Pennsylvania.

 M & N filed an opposing Affidavit which set forth that on July 13, 1973, Hess-Stephenson telephoned M & N in Pittsburgh and offered beef for sale. M & N agreed to purchase three loads of beef and the sale was confirmed by Hess-Stephenson in writing. At the direction of M & N, American shipped the first load of beef to Fred's Frozen Foods in Nobles, Indiana and to Ocoma Foods in Humboldt, Tennessee. American invoiced M & N, who mailed their check from Pittsburgh to American in full payment for the delivered beef. When American failed to deliver the meat covered by the remaining written confirmation, suit was brought for $36,000.00, representing the increased cost at which M & N procured an equal amount of beef. It is noted that the confirmation by Hess-Stephenson was for orders f.o.b. Chicago, f.o.b. Boston, and f.o.b. New York.

 The applicable Pennsylvania "Long Arm" Statute provides in relevant part as follows:

 
"§ 8309. Acts affecting jurisdiction
 
(a) General rule. -- Any of the following shall constitute 'doing business' for the purposes of this chapter:
 
(1) The doing by any person in this Commonwealth of a series of similar acts for the purpose of thereby realizing pecuniary benefit or otherwise accomplishing an object.
 
(2) The doing of a single act in this Commonwealth for the purpose of thereby realizing pecuniary benefit or otherwise accomplishing an object with the intention of initiating a series of such acts.
 
(3) The shipping of merchandise directly or indirectly into or through this Commonwealth.
 
(4) The engaging in any business or profession within this Commonwealth, whether or not such business requires license or approval by the ...

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