The Facts of The Case
In late 2007, Drake, a Delaware corporation, agreed with Polyflow to sell “couplings” that the agreement termed as products designed by Polyflex for Thermoflex Tubing. Drake’s plant is in Sheffield, Pennsylvania and the company shipped the products from the location to Polyflow’s business establishment in Oak, Pennsylvania. Seventy-five bills for the couplings were presented for payment of goods delivered from August 2008 to April 2009. Part of the 75 bills included the shipment of equipment termed “portable swaging machines” to Polyflow. The recipient of the products refused to pay for the goods.
The Issue at The Law of The Court Considering
The issue in the case emerges from Section 4121 and Section 4122(a) of Pennsylvania’s law on Corporations and Unincorporated Associations Code. Section 4121 of the code states that a foreign business corporation shall acquire a certificate of authority from the State Department before doing any business in the state in compliance with the regulations stated in the chapter. Section 4122(a) defines the activities that do not constitute doing business in the state. Interpretation of Section 4122(a) indicates that activities that require a certificate of authority include maintenance of an office to do business in the state and engaging in the sale of personal property that is not in interstate commerce. It also includes contracts that lead to sales or a local business and ownership or use of the real estate for general corporate functions.
How The Law Was Applied in This Case
Polyflow did not dispute the breach of the contract dispute. The defendant stated that its failure to pay for the goods delivered was based on the fact that Drake did not have the capacity to sue. The court rejected the argument and Polyflow’s motion for a nonsuit, favoring Drake’s payment of $291,766.61. Polyflow’s post-trial suit was accepted on appeal based on the regulations and codes provided in Sections 4121 and 4122(a) of the Corporations and Unincorporated Associations Code. The court found that Drake’s activities amounted to doing business and should have prompted the acquisition of a certificate of authority from the state department.
Conclusion of the Court
The Superior Court found that the Trial Court erred when it denied Polyflow’s motion for judgment. The court found that Sections 4121 and 4122(a) provided regulations for a foreign party to conduct business in the state and what amounted to business. Drake’s activities from the time of agreement to the delivery of goods amounted to doing business. Its failure to file and acquire the relevant certificate of authority contravened the state’s law. The court ruled that Polyflow was erred by having its suit rejected.