APPEAL from the Circuit Court of Du Page County; the Hon.
PHILIP F. LOCKE, Judge, presiding.
MR. JUSTICE HALLETT DELIVERED THE OPINION OF THE COURT:
The plaintiffs filed a petition for the registration (under the Uniform Enforcement of Foreign Judgments Act, Ill. Rev. Stat. 1971, ch. 77, pars. 88-105), of a judgment in their favor against the Bank of Westmont, entered in Arizona, under its "long-arm" statute. The trial court refused registration on the ground that the Arizona court was without jurisdiction over the Bank. The plaintiffs appeal, contending that the Arizona court did have jurisdiction. We agree and reverse and remand the case for such registration.
In October, 1971, Edna Trybulski, a widow, and her son William Stupar bought a Ford Pinto from a dealer in Naperville under the usual retail installment sales contract signed by them, which contract was assigned to the Bank of Westmont. They fell behind in their payments and the son, early in 1972, left the State without notice to the bank, taking the car with him, contrary to the contract. In December of 1972, the bank finally located him in Phoenix, Arizona, and employed someone in Arizona who, without prior notice to the son, repossessed the car and returned it to Illinois. The bank then gave the son notice of the repossession and of its intention to sell the car unless he paid off the then balance of $2,153.19. His lawyer in Arizona wrote the bank, demanding the return of the car and tendering a check sufficient to bring the payments up to date.
Not receiving an answer, the son and his mother, in January 1973, went into the Superior Court of Maricopa County, Arizona, which issued a temporary injunction which was, together with copies of their complaint, a summons, and a "Rule to Show Cause," served on the bank by a deputy sheriff of Du Page County on January 5, 1973. On January 13, 1973, the Arizona court entered an order enjoining the bank from selling the automobile. This order was duly served on the defendant by a deputy sheriff of Du Page County, as had been the summons and complaint. The bank never filed an appearance in the Arizona proceedings or responded in any way. It also apparently ignored and disobeyed the injunction order since by its own admission it has sold the automobile. On February 16, 1973, the Superior Court of Maricopa County, Arizona, entered a default judgment for the plaintiffs against the defendant for $7,969.31 actual damages, $15,000 punitive damages, and costs, finding that the defendant's conduct was wrongful, wanton, willful, intentional and malicious. That court specifically found that "the Bank of Westmont has caused events to occur in Maricopa County, State of Arizona, out of which the cause of action of the plaintiffs arose in that the said Bank of Westmont did retain and direct repossession of a 1972 Pinto automobile * * * which is the subject matter of this action, in Maricopa County, Arizona, and that this court has jurisdiction pursuant to the provisions of Rule 4(e)(2) Arizona Rules of Civil Procedure." The defendant did not appeal.
On March 2, 1973, the petitioners filed, in the Circuit Court of Du Page County, a petition for the registration of a foreign judgment under the Illinois Uniform Enforcement of Foreign Judgments Act (Ill. Rev. Stat. 1973, ch. 77, pars. 88-105), attaching a certified copy of that said Arizona judgment, and setting out the service of the complaint, summons, on the defendant and other jurisdictional facts above outlined.
The defendant bank was served and answered, admitting the facts but denying the legal conclusion that the judgment "remains in full force and effect." Finally, on December 10, 1973, the trial court denied the motion for entry of a final judgment and for registration of said foreign judgment "for the reason that the Superior Court of Arizona for Maricopa County was utterly and completely without jurisdiction over the defendant BANK OF WESTMONT in its case No. C-271791." It also ordered that the petitioners go hence without day and found no just reason to delay appeal or enforcement. It is from this order that the petitioners appeal.
The leading case in the field of "long arm" statutes is, of course, International Shoe Co. v. Washington (1945), 326 U.S. 310, 90 L.Ed. 95, 66 S.Ct. 154. There the question presented was "whether, within the limitations of the due process clause of the Fourteenth Amendment, appellant, a Delaware corporation has by its activities in the State of Washington rendered itself amenable to proceedings in the courts of that state to recover unpaid contributions to the state unemployment compensation fund exacted by state statutes, * * *." (326 U.S. 310, 311, 90 L.Ed. 95, 99, 66 S.Ct. 154.) The appellant had its principal place of business in St. Louis, Mo., and manufactured and sold shoes and other footwear. It had no office in Washington and maintained no stock of goods there. It did, however, employ 11 to 13 salesmen who resided in Washington, under supervision from St. Louis. They merely solicited and transmitted orders to St. Louis for acceptance or rejection and shipment F.O.B. St. Louis. No salesman could enter into a contract or make collections.
In sustaining the jurisdiction of the court of the State of Washington to hear and determine the State's claim for unemployment compensation against the employer corporation, the United States Supreme Court, speaking through Mr. Chief Justice Stone, said:
"Historically the jurisdiction of courts to render judgment in personam is grounded on their de facto power over the defendant's person. Hence his presence within the territorial jurisdiction of a court was prerequisite to its rendition of a judgment personally binding him. Pennoyer v. Neff, 95 U.S. 714, 733. But now that the capias ad respondendum has given way to personal service of summons or other form of notice, due process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend `traditional notions of fair play and substantial justice.' Milliken v. Meyer, 311 U.S. 457, 463. See Holmes, J., in McDonald v. Mabee, 243 U.S. 90, 91. Compare Hoopeston Canning Co. v. Cullen, 318 U.S. 313, 316, 319. See Blackmer v. United States, 284 U.S. 421; Hess v. Pawloski, 274 U.S. 352; Young v. Masci, 289 U.S. 253." 326 U.S. 316-17, 90 L.Ed. 10102, 66 S.Ct. 154.
Perhaps the next well known case in this field is McGee v. International Life Insurance Co. (1957), 355 U.S. 220, 2 L.Ed.2d 223, 78 S.Ct. 199. There Franklin, a resident of California, purchased a life insurance policy from an Arizona company. Later the defendant company assumed the contracts of the original insurer and mailed a reinsurance certificate to Franklin in California and he accepted and paid premiums until his death. His mother, Mrs. McGee, was the beneficiary and filed proofs but it refused to pay, claiming suicide. The company had no office or agent in California and, aside from this one policy, had never solicited business there.
The mother then sued in California and summons was served by registered mail in Texas. She recovered a judgment in California and, when it was not paid, sued in Texas to enforce it. The trial court refused to do so on the same ground as the trial court cited in the case at bar. In reversing and remanding, the Supreme Court said:
"Since Pennoyer v. Neff, 95 U.S. 714, this Court has held that the Due Process Clause of the Fourteenth Amendment places some limit on the power of state courts to enter binding judgments against persons not served with process within their boundaries. But just where this line of limitation falls has been the subject of prolific controversy, particularly with respect to foreign corporations. * * * More recently in International Shoe Co. v. Washington, 326 U.S. 310, the Court decided that `due process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend "traditional notions of fair play and substantial justice."' Id., at 316.
"Looking back over this long history of litigation a trend is clearly discernible toward expanding the permissible scope of state jurisdiction over foreign corporations and other nonresidents. In part this is attributable to the fundamental transformation of our national economy over the years. Today many commercial transactions touch two or more States and may involve parties separated by the full continent. With this increasing nationalization of commerce has come a great increase in the amount of business conducted by mail across state lines. At the same time modern transportation and communication have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity.
"Turning to this case we think it apparent that the Due Process Clause did not preclude the California court from entering a judgment binding on respondent. It is sufficient for purposes of due process that the suit was based on a contract which had substantial connection with that State. Cf. Hess v. Pawloski, 274 U.S. 352; Henry L. Doherty & Co. v. Goodman, 294 U.S. 623; ...