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09/01/95 DUTCH FARM MEATS v. HORIZON FOODS

September 1, 1995

DUTCH FARM MEATS, INC., AN INDIANA CORPORATION, PLAINTIFF-APPELLEE,
v.
HORIZON FOODS, INC., AN ILLINOIS CORPORATION, DEFENDANT, AND PRIME FOODS, INC., AN ILLINOIS CORPORATION, DEFENDANT-APPELLANT.



Appeal from the Circuit Court of Cook County. The Honorable Paddy H. McNamara, Judge Presiding.

As Corrected October 4, 1995. Rehearing Denied October 4, 1995. Petition for Leave to Appeal Denied January 31, 1996.

The Honorable Justice T. O'brien delivered the opinion of the court. Cousins, Jr., P.j., and McNulty, J., concur.

The opinion of the court was delivered by: O'brien

The Honorable Justice T. O'BRIEN delivered the opinion of the court.

Defendant, Prime Foods, Inc. (Prime Foods), appeals from an order of the circuit court of Cook County which denied its petition to quash the return of summons. On appeal, defendant contends that the court erred in concluding that the substitute service effectuated by plaintiff through the Secretary of State was proper. We disagree and affirm the circuit court's order.

On July 24, 1991, plaintiff, an Indiana corporation, filed a breach of contract action against Horizon Foods, Inc. (Horizon), an Illinois corporation, seeking payment of $50,339.27 for the delivery of certain meat products. Plaintiff filed a second amended complaint on August 14, 1992, adding a derivative count against defendant Prime Foods based on Horizon's sale of substantially all of its assets to Prime Foods. This derivative count arose out of Prime Foods' failure to notify Horizon's creditors in accordance with the Illinois' Bulk Transfer provisions. Ill. Rev. Stat. 1989, ch. 26, par. 6-101 et seq.

In the following month, plaintiff's attorney, Chandramathi Hanumadass, ascertained the name and address of Prime Foods' registered agent through the office of the Secretary of State. Hanumadass then prepared a summons directed to that agent, at the registered address, 2 North LaSalle, Suite 725, Chicago, Illinois. The sheriff unsuccessfully attempted to serve the summons on October 2, 1992, and his return indicated that the agent had moved.

In March 1993, Hanumadass again contacted the Secretary of State to see if defendant or its agent had filed a change of address. According to the Secretary of State, the listing had not been changed in any way. Hanumadass then prepared an affidavit for compliance with service on the Secretary of State and filed it with a copy of the complaint and the summons. Hanumadass also sent a copy of the original summons, the complaint and a copy of the affidavit of compliance for service on the Secretary of State by certified mail, return receipt requested, to (i) the registered agent at the address indicated and (ii) the president of Prime Foods, Hasan Farid, at 7623 Sussex Creek Drive in Darien, Illinois. Hanumadass received a return receipt of delivery at the latter address, dated April 3, 1993, which was signed by Susan Farid. However, no certified mail or return receipt of the materials sent to defendant's registered agent was ever received.

On July 21, 1993, plaintiff proceeded ex parte against Horizon, and the circuit court entered judgment in the amount requested. The court also considered plaintiff's motion for a default judgment against defendant for failing to appear. Noting the documents indicating proof of service on the Secretary of State and return receipt of the materials sent to Hasan Farid, the court continued the case for seven days so that plaintiff could prepare a supporting memorandum on the issue of the applicability of the Bulk Sales Act to defendant. Plaintiff complied with the court's directive, and on July 30, 1993, the court entered a default judgment in favor of plaintiff and against defendant in the amount of $50,339.27 plus costs.

On February 18, 1994, plaintiff filed a citation to discover assets against the president of Prime Foods, and he was personally served four days later. On August 15, 1994, defendant filed a special and limited appearance to contest the court's jurisdiction through the substitute service. Defendant asserted that, contrary to the Illinois Business Corporation Act, plaintiff did not exercise reasonable diligence in personally serving defendant given its public persona, i.e., that it was doing business at two locations in the city and that it was listed in the telephone directory. Moreover, defendant's agent's present address wassimilarly listed in the telephone directory as well as in established legal directories.

The circuit court denied defendant's motion to quash summons, finding that plaintiff used reasonable diligence to serve defendant's agent at its registered office before serving process on the Secretary of State. Defendant appealed.

Defendant claims that plaintiff's substitute service on the Secretary of State was improper because plaintiff failed to exercise reasonable diligence to effectuate service. We disagree.

Section 2-204 of the Code of Civil Procedure provides in part that:

"[a] private corporation may be serviced (1) by leaving a copy of the process with its registered agent or any officer or agent of the corporation found anywhere in the State; or (2) in any other manner now or ...


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