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A personal judgment against nonresidents doing business within the state as partners cannot be based upon service of process upon a resident agent upon any theory that by doing business within the state the partners consented to be bound by the service prescribed by a local statute, even though such statute purports to make the person served an agent to receive service in suits arising out of the business done in the state.
At the time of the transaction in question, defendants, who were nonresidents of Kentucky, were doing business in Kentucky by means of an agent. Plaintiff instituted an action before a Kentucky court. Defendants' agent was served with a writ under the Kentucky statute that permitted service if defendants did business therein. The agent contended that he was not defendants' agent at the time of service upon him and that the Kentucky service statute was unconstitutional, but judgment was obtained against defendants, who did not appear, and later, an action was brought in an Illinois state court to enforce the judgment. The Illinois court found that the Kentucky service statute was unconstitutional and entered judgment in favor of defendants. On appeal, the Illinois high court affirmed the lower court's judgment, and plaintiff in error sought further review.
Under the circumstances, was the Kentucky judgment void?
The United States Supreme Court affirmed the state supreme court’s decision, noting that the analogy relied on, that of corporations doing business in a foreign state, depended upon the right of the state to exclude them. As the state had no such power in the case of individuals, the analogy broke down, and the Kentucky judgment was void. According to the Court, a State has no power to provide that nonresident individuals, in suits growing out of their business transacted within the State through a local agent, shall be bound by process served upon him after the agency was at an end; and a judgment against a firm of nonresidents, based upon such service, was void.