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Figueroa v. BNSF Railway Co.

Supreme Court of Oregon, En Banc

March 2, 2017

Lillian FIGUEROA, Plaintiff-Adverse Party,
v.
BNSF RAILWAY COMPANY, a Delaware corporation, Defendant-Relator.

          Argued and submitted November 10, 2016

         Original proceeding in mandamus, CC 15CV13390 [*]

          W. Michael Gillette, Schwabe, Williamson & Wyatt, P.C., Portland, argued the cause for relator. Sara Kobak filed the briefs for relator. Also on the briefs were Noah Jarrett and Aukjen Ingraham of Schwabe, Williamson & Wyatt, P.C., and Andrew S. Tulumello and Michael R. Huston of Gibson, Dunn & Crutcher LLP, Washington DC.

          Stephen C. Thompson, Kirklin Thompson & Pope, LLP, Portland, argued the cause and filed the brief for adverse party. Also on the brief was Kristen A. Chambers.

          Robyn Ridler Aoyagi, Tonkon Torp LLP, Portland, filed the brief for amicus curiae Washington Legal Foundation.

          Lisa T. Hunt, Law Office of Lisa T. Hunt, Lake Oswego, filed the brief for amicus curiae Oregon Trial Lawyers Association.

         Case Summary:

Plaintiff brought this action in Oregon against a foreign corporation to recover for injuries that she sustained in Washington. The corporation moved to dismiss because Oregon lacks general jurisdiction over it. The trial court denied the motion, and the Supreme Court issued a peremptory writ of mandamus to the trial court.

         Held:

(1) Under Daimler AG v. Bauman, 571 US, 134 S.Ct. 746, 187 L.Ed.2d 624 (2014), a state ordinarily can exercise general jurisdiction in one of two places: where the corporation is incorporated and where it maintains its principal place of business; (2) this case does not come within the limited exception recognized in Daimler to that rule: Oregon cannot be considered a surrogate for the corporation's state of incorporation or principal place of business; and (3) appointing a registered agent for receipt of process pursuant to ORS 60.731(1) does not constitute implied consent to the jurisdiction of the Oregon courts.

         Peremptory writ to issue.

          KISTLER, J.

         Oregon requires that foreign corporations doing business in this state appoint a registered agent to receive service of process. ORS 60.73K1).[1] The primary question that this case presents is whether, by appointing a registered agent in Oregon, defendant (a foreign corporation) impliedly consented to general jurisdiction here-that is, whether defendant consented to have Oregon courts adjudicate any and all claims against it regardless of whether those claims have any connection to defendant's activities in this state.[2] Defendant moved to dismiss this action because the trial court lacked general jurisdiction over it. When the court denied the motion, defendant petitioned for an alternative writ of mandamus. We issued the writ, the trial court adhered to its decision, and the trial court's ruling is now before us for decision. We hold, as a matter of state law, that the legislature did not intend that appointing a registered agent pursuant to ORS 60.731(1) would constitute consent to the jurisdiction of the Oregon courts.

         Plaintiff was working for BNSF Railway Company in Pasco, Washington, where she was repairing a locomotive engine. To perform the repair, she had to stand on a portable stair placed on a catwalk on the locomotive. While she was reaching up to remove an engine part, the "portable stair supplied by [BNSF] rolled or kicked out from under [p] Iain-tiff, " causing her to sustain substantial injuries. Plaintiff alleged that her "injuries resulted in whole or in part from [BNSF's] negligence in failing to provide [her] with a safe place to work, and with safe tools and equipment." For the purposes of this case, we assume that those allegations are true.

         BNSF is a foreign corporation. It is incorporated in Delaware and has its principal place of business in Fort Worth, Texas.[3] Plaintiff brought this action against BNSF in Oregon to recover for the injuries that she sustained in Washington. When BNSF moved to dismiss for lack of personal jurisdiction, plaintiff advanced three arguments. She argued: (1) that BNSF's activities in this state were sufficient for Oregon courts to exercise general jurisdiction over it; (2) that the Federal Employees Liability Act, 35 Stat 65, as amended, codified as 45 USC sections 51-60, gives a state general jurisdiction over interstate railroads doing business in the state; and (3) that, by appointing a registered agent in Oregon to receive service of process, BNSF had consented to general jurisdiction in Oregon. Our opinion in Barrett v. Union Pacific Railroad Co.. 361 Or 115, __ P.3d __ (2017), resolves plaintiff's first two arguments. We write only to address her third argument regarding Oregon's registration statute.

         I. OREGON'S REGISTRATION STATUTE

         ORS 60.721 requires that foreign corporations doing business in Oregon maintain a registered office and appoint a registered agent in this state. ORS 60.731(1) provides that the registered agent "shall be an agent of such corporation upon whom any process, notice or demand required or permitted by law to be served upon the corporation may be served." The parties disagree about what ORS 60.731(1) means. Relying on a 1915 Oregon case interpreting an earlier corporate registration statute, plaintiff argues that, by appointing a registered agent, BNSF impliedly consented to general jurisdiction in Oregon. BNSF responds that ORS 60.731(1) requires only that a foreign corporation designate a person in Oregon upon whom process may be served; it says nothing about jurisdiction. Alternatively, BNSF argues that, even if appointing a registered agent manifests implied consent to specific jurisdiction, it does not constitute consent to general jurisdiction. Finally, BNSF contends that requiring foreign corporations to consent to general jurisdiction as a condition of doing business in Oregon violates the federal constitution.

         As noted above, our holding in this case turns on the legislature's intent in enacting ORS 60.731(1). Specifically, we conclude that appointing a registered agent to receive service of process merely designates a person upon whom process may be served. It does not constitute implied consent to the jurisdiction of the Oregon courts. In reaching that conclusion, we follow our usual methodology for interpreting statutes. We consider the text, context, and legislative history of ORS 60.731(1). See State v. Gaines. 346 Or 160, 170-71, 206 P.3d 1042 (2009) (describing statutory construction methodology).

         A. Text

         ORS 60.731(1) provides:

"The registered agent appointed by a foreign corporation authorized to transact business in this state shall be an agent of such corporation upon whom any process, notice or demand required or permitted by law to be served upon the corporation may be served."

         Textually, ORS 60.731(1) addresses service, not jurisdiction. Jurisdiction refers to the forum's authority to adjudicate claims against a defendant. Pennoyer v. Neff, 95 U.S. 714, 722-23, 24 L.Ed. 565 (1878). Service refers to the process by which a defendant over whom a court has jurisdiction is brought before the court. See id. at 727. Both are necessary for a court to issue a binding judgment, but the two concepts are not synonymous.

         By its terms, ORS 60.731(1) addresses only one of those concepts. ORS 60.721 requires foreign corporations doing business here to designate a registered agent in this state upon whom process may be served. ORS 60.731(1) defines the function that the registered agent serves; the agent is a person authorized to accept service of process "required or permitted by law" to be served on the corporation. The statute neither addresses jurisdiction nor equates appointing an agent for service with consent to jurisdiction in Oregon. Beyond that, ORS 60.731(1) requires that the agent be authorized to accept "any process, notice or demand required or permitted by law to be served upon the corporation." (Emphasis added.) As the emphasized text makes clear, ORS 60.731(1) looks to some other source of law to define which process a registered agent must be "required or permitted" to accept. If another source of law (the Fourteenth Amendment or a state long-arm statute, for instance) does not require or permit process to be served on the corporation, then ORS 60.731(1) does not provide an independent source of jurisdiction where there otherwise would be none. Rather, ORS 60.731(1) merely requires the registered agent be authorized to accept the process that another source of law "require[s] or permit[s]" to be served upon the corporation.

         B. Context

         Context includes "'the preexisting common law and the statutory framework within which the law was enacted.'" Stevens v. Czerniak. 336 Or 392, 401, 84 P.3d 140 (2004) (quoting Denton and Denton. 326 Or 236, 241, 951 P.2d 693 (1998)). In this case, there are three contextual sources that bear on the interpretation of ORS 60.731(1): (1) due process limitations on exercising personal jurisdiction over foreign corporations; (2) the 1903 Oregon corporation statute requiring foreign corporations to appoint a registered agent for service of process as a condition of doing business here and state cases interpreting that statute; and (3) the 1953 Oregon corporation statute, which revised and replaced the 1903 statute and enacted what is currently codified as ORS 60.731(1). We describe each of those sources briefly and then explain why those sources persuade us that this court's interpretation of the 1903 registration statute does not inform the current registration statute's meaning.

         1. Constitutional limitations on jurisdiction over foreign corporations

         Between the enactment of the first comprehensive Oregon corporation statute in 1903 and the first major revision of that statute in 1953, the terms on which state courts could constitutionally exercise personal jurisdiction over foreign corporations changed. A brief discussion of that change in constitutional law is necessary to put the corresponding changes to Oregon's registration statutes in perspective.

         In 1878, the United States Supreme Court held that the Due Process Clause places geographical limits on a state's exercise of jurisdiction over persons and property. Pennoyer, 95 U.S. at 722-23; see Burnham v. Superior Court of CaL, Marin County, 495 U.S. 604, 110 S.Ct. 2105, 109 L.Ed.2d 631 (1990) (plurality) (describing Pennoyer). Regarding personal jurisdiction, the Court recognized that a state can adjudicate transient claims (negligence claims, breach of contract claims, and the like) against nonresident defendants (natural persons) if those persons were served within the state's geographical boundaries.[4] Pennoyer, 95 U.S. at 733; see Burnham, 495 U.S. at 617 (plurality). Under Pennoyer, a person's presence within the state's territorial boundaries gave the state authority to adjudicate transient claims against that person, and service while the person was within the state's jurisdiction perfected that authority.

         Pennoyer did not consider when a state can exercise personal jurisdiction over foreign corporations. Before International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), the cases that addressed that issue started from the proposition that a corporation was subject to suit only in the state where it was incorporated. See St. Clair v. Cox, 106 U.S. 350, 354, 1 S.Ct. 354, 27 L.Ed. 222 (1882) (discussing earlier decisions). As the Court explained, however, "[t]he doctrine of the exemption of a corporation from suit in a State other than that of its creation was the cause of much inconvenience and often of manifest injustice." Id. To avoid that problem, two related but separate theories for acquiring jurisdiction over foreign corporations developed.

         One theory was based on implied consent. See St. Clair, 106 U.S. at 354-55; The Lafayette Insurance Co. v. French, 59 U.S. (18 How) 404, 407-08, 15 L.Ed. 451 (1855). Consent was implied either because the foreign corporation was doing business in the state or because the corporation had complied with a state statute requiring that it appoint a registered agent in the state to receive service of process. See William F. Cahill, Jurisdiction over Foreign Corporations, 30 Harv L Rev 676, 690 (1917); Joseph Henry Beale, The Law of Foreign Corporations § 280 (1904) (consent implied from merely doing business in a state). The other theory was based on presence. A foreign corporation that was doing business in a state was present in that state in much the same way that a natural person was. Compare International Harvester v. Kentucky,234 U.S. 579, 34 S.Ct. 944, 58 L.Ed. 1479 (1914) (continuous course of soliciting business and delivering machines in Kentucky was sufficient to establish that the corporation was doing business there and thus present), with Green v. Chicago, Burlington & Quincy Ry.,205 U.S. 530, 533-34, 27 S.Ct. 595, 51 L.Ed. 916 (1907) (soliciting ...


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