Mueller v. Seaboard Commercial Corporation

Supreme Court of New Jersey · 1950 · Corporations

73 A.2d 905 (1950)

Updated August 22, 2026

CorporationsAttachmentAgencyConversionPiercing the corporate veilR.S. 2:42-88Rule 3:72-1Rule 3:43-3

Facts

Plaintiff sought attachment against Seaboard, a Delaware corporation with its principal place of business in New York, alleging Seaboard was a nonresident not subject to service in New Jersey. Seaboard owned all of the stock of Technical Devices Corporation, decided to liquidate Technical, required Technical to turn over all money it received, and acted through Raeder and Roberts in directing Technical's affairs. Plaintiff owned chattels worth $25,000 that were in Technical's possession under an option to purchase, and when plaintiff sought their return after Technical chose not to exercise the option, delivery was refused. Plaintiff's affidavits asserted that Roberts and Technical refused delivery under Raeder's instructions and thus acted as Seaboard's agents in converting the property.

Issue

Whether the affidavits supporting the writ of attachment sufficiently established, under R.S. 2:42-88 and the applicable court rules, a prima facie cause of action against Seaboard for conversion. Also, whether the affidavits were supported by competent, admissible facts rather than impermissible hearsay or mere declarations of an alleged agent.

Rule

A writ of attachment may issue upon affidavit proof satisfactory to the court that the defendant is a nonresident not subject to service and that the plaintiff has a specified cause of action. When a motion to quash is based solely on the original attachment papers, the affidavit averments are deemed true and all legitimate deductions and inferences are drawn in favor of the plaintiff; if the papers show a prima facie case, that is enough. Supporting affidavits must be made on personal knowledge and contain admissible facts, but agency and participation in a tort may be shown by competent evidence and reasonable inferences, and a principal is liable for conversion committed or instigated by its agents within the scope of agency.

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Lena Ortiz, a Texas resident, sought a writ of attachment in Newark against North Channel Holdings, a Nevada corporation with its office in Phoenix and no New Jersey agent for service. Her affidavits stated that North Channel wholly owned Garden State Fabrication, required it to remit all receipts to Phoenix, and directed its manager not to return Lena's leased machinery after the lease ended. North Channel moved to quash based only on the original attachment papers and filed no counter-affidavits.

How should the court evaluate the motion to quash?

Explanation. When a motion to quash or dissolve an attachment is based only on the original papers, the affidavit averments are taken as true and all legitimate deductions and inferences are drawn in the plaintiff's favor. The plaintiff need only show a prima facie case, not full trial-level proof. Facts showing complete control of the subsidiary and instructions to refuse return of the property are enough to support a prima facie conversion claim against the parent.