This matter is before the court on defendant-mortgagors' motion to dismiss, without prejudice, plaintiff-mortgagee's foreclosure action pursuant to two sections of the Foreign Corporations Chapter of our Business Corporation Act, N.J.S.A. 14A:13-11 and N.J.S.A. 14A:13-20. These sections, respectively, bar the use of New Jersey courts by foreign corporations which have not obtained a certificate of authority to do business, under N.J.S.A. 14A:13-1 et seq. (hereinafter the authorization statute) or have not complied with the New Jersey Corporation Business Activities Reporting Act (hereinafter reporting act), N.J.S.A. 14A:13-15 et seq. Plaintiff is a wholly-owned operating subsidiary of a New York national bank engaged in the servicing of mortgages for the bank and admits that it has no certificate of authority and has not complied with the reporting act.
The facts and procedural history are not complicated. In July 1981, defendants Henry T. Davis, III and his wife, Chom Sun Davis, purchased a home in Fairfield, Cumberland County, and executed a mortgage in favor of a New Jersey lending institution. Later that year, the lending institution assigned the mortgage to plaintiff, New York Guardian Mortgagee Corporation, as noted, a wholly-owned operating subsidiary of Guardian Bank, N.A., a New York national bank. As a result of an alleged default by defendants in their mortgage payments, plaintiff brought this suit to foreclose the mortgage in 1983.
Defendants opposed the foreclosure by, inter alia, moving to dismiss the action without prejudice pending compliance with the authorization statute and reporting act. The enforcement provision of the authorization statute, N.J.S.A. 14A:13-11, states in pertinent part:
No foreign corporation transacting business in this state without a certificate of authority shall maintain any action or proceeding in any court of this state, until such corporation shall have obtained a certificate of authority.
The enforcement provision of the reporting act, N.J.S.A. 14A:13-20, states in pertinent part:
No foreign corporation carrying on any activity or owning or maintaining any property in this State which has not obtained a certificate of authority to do business in this State and disclaims liability for the corporation business tax and the corporation income tax shall maintain any action or proceeding in any State or Federal court in New Jersey, until such corporation shall have filed a timely notice of business activities report.
Plaintiff opposes the motion to dismiss by making a two-pronged argument. It argues first that, as an operating subsidiary of a national bank, it is governed by federal banking law and is entitled to the same protection which that law gives to national banks. Second, plaintiff argues that federal banking law entitles national banks to sue in any state as fully as a natural person, i.e., human being, see Black's Law Dictionary (5 ed. 1979). Because the statutes invoked by defendants bar suits by corporations but not suits by natural persons, they prevent national banks from suing as fully as natural persons -- such statutes are thus in conflict with federal banking law and are superceded.
Plaintiff's argument thus raises two issues, both of which are issues of first impression:
(1) Is plaintiff to be allowed to sue as if it were a national bank?
(2) Do the two named statutes conflict with a federal banking law requirement that national banks be free to sue as fully as natural persons?
Before reaching these two issues of federal law,*fn1 however, the court must decide whether under state law the two statutes apply; if they do not, clearly the ...