tinuances as may be found necessary to give reasonable time and opportunity for defense. It makes no hostile discrimination against non-residents but tends to put them on the same footing as residents. Literal and precise equality in respect of this matter is not attainable; it is not required. Canadian Northern Ry. Co. v. Eggen, 252 U. S. 553, 561-562. The State's power to regulate the use of its. highways extends to their use by non-residents as well as by residents. Hendrick v. Maryland, 235 U. S. 610, 622. And, in advance of the operation of a motor vehicle on its highway by a non-resident, the State may require him to appoint one of its officials as his agent on whom process may be served in proceedings growing out of such use. Kane v. New Jersey, 242 U. S. 160, 167. That case recognizes power of the State to exclude a non-resident until the formal appointment is made. And, having the power so to exclude, the State may declare that the use of the highway by the non-resident is the equivalent of the appointment of the registrar as agent on whom process may be served. Cf. Pennsylvania Fire Insurance Co. v. Gold Issue Mining Co., supra, 96; Lafayette Ins. Co. v. French, 18 How. 404, 407-408. The difference between the formal and implied appointment is not substantial so far as concerns the application of the due process clause of the Fourteenth Amendment. Judgment affirmed.2 HENRY L. DOHERTY & CO. v. GOODMAN. SUPREME COURT OF THE UNITED STATES. 1935. 294 United States 623. . APPEAL from the Supreme Court of Iowa. MR. JUSTICE MCREYNOLDS delivered the opinion of the Court. The actual decision in Kane v. New Jersey (1916) was that a nonresident motorist who failed to comply with a criminal statute requiring him to appoint a state official as his agent for service of process might constitutionally be convicted. 2 The cases as to constitutionality of nonresident motorist statutes are collected in Note, 35 A. L. R. 951 (1925) (annotating the decision below in the principal case), supplemented in 57 A. L. R. 1239 (1928) and in 99 A. L. R. 130 (1935). As to the construction, application and effect of such statute, see Note, 82 A. L. R. 768 (1933), supplemented in 96 A. L. R. 594 (1935); 12 Ind. L. J. 73 (1936); Note, 50 Harv. L. Rev. 1119, 1128-1129 (1937). Suppose that the statute allows service on a state official but does not require that official to notify the defendant. May a personal judgment constitutionally be rendered against a nonresident defendant if the official does not in fact notify him? If the official does notify him? See Wuchter v. Pizzutti, 276 U. S. 13 (1928). See Restatement, Judgments (1942) § 23. L. Doherty & Company, established an office at Des Moines, Polk County, Iowa, and there through agents carried on the business of selling corporate securities throughout the State. E. A. King, designated as District Manager, took charge of this office in January, 1929, and continued to direct its affairs during the time here important. Under him were clerks and stock salesmen, paid directly from New York. A salesman operating from the Des Moines office, September 1, 1929, negotiated in that city a sale of stock to appellee Goodman, and out of this the present controversy arose. The only power or authority expressly conferred upon King by Doherty was to sell securities and supervise other employees; he never in terms consented that service of process upon this agent should constitute service upon himself. Sec. 11079, Iowa Code 1927, also 1931, in effect since 1851, provides: "When a corporation, company, or individual has, for the transaction of any business, an office or agency in any county other than that in which the principal resides, service may be made on any agent or clerk employed in such office or agency, in all actions growing out of or connected with the business of that office or agency." July 31, 1931, appellee Goodman commenced an action against Doherty in the District Court, Polk County, wherein he sought only a personal judgment for damages arising out of the sale contract of September 1, 1929. The usual summons or notice commanding the defendant to appear was served upon District Manager King. Doherty appeared specially. He challenged the jurisdiction of the court; claimed he had not been within the State; King had no authority to accept service of process in his behalf; the alleged service was ineffective; and to hold otherwise would deprive him of rights guaranteed by the Federal Constitution. The District Court, relying upon Code § 11079, overruled the special plea and held the service adequate. Doherty made no further appearance. Judgment against him was affirmed by the Supreme Court. The cause is here by appeal. Appellant insists that if construed as applicable to him, a citizen of another State never in Iowa, in the circumstances disclosed by the record, § 11079 offends the Federal Constitution, § 2, Art. 4, and § 1, 14th Amendment. The Supreme Court affirmed the action of the trial court upon authority of Davidson v. H. L. Doherty & Co., (1932) 214 Iowa 739.1 The opinion in that cause construed § 11079 and, among other things, said: 2 1 The decision in the state court is annotated and discussed in Note, 91 A. L. R. 1327 (1934). See also 46 Harv. L. Rev. 153 (1932). 2 Indicated omissions and single quotation marks are from the original report. "By its terms, and under our holding, the statute is applicable to residents of any other county' than that in which the principal resides, whether such county be situated in Iowa or in some other state. In other words, the statute does apply to non-residents of Iowa who come within its terms and provisions, as well as to residents. Our construction of the statute has stood since 1887. . . . We adhere to our former holdings that the statute is applicable to individual non-residents who come within its express terms and provisions. ... "The statute in question does not in any manner abridge the privileges or immunities of citizens of the several states. It treats residents of Iowa exactly as it treats residents of all other states. The citizens of each state of the United States are, under this statute, entitled to all the privileges and immunities accorded citizens of this state. "The justice of such a statute is obvious. It places no greater or different burden upon the non-resident than upon the resident of this state. . . . A non-resident who gets all the benefit of the protection of the laws of this state with regard to the office or agency and the business so transacted ought to be amenable to the laws of the state as to transactions growing out of such business upon the same basis and condition as govern residents of this state. . . . It make no hostile discrimination against non-residents, but tends to put them on the same footing as residents. "Four things are, under this statute, essential to the validity of such service. 1. The defendant must have an office or agency in the county. 2. It must be a county other than that in which he resides. 3. The action must grow out of or be connected with the business of that office or agency. 4. The agent or clerk upon whom service is made must be employed in such office or agency.' . . "When a non-resident defendant establishes an office or agency for the transaction of business in any county in this state under this statute, he thereby voluntarily appoints his own agent, in charge of said office or agency, as one upon whom substituted service in actions in personam, growing out of that office or agency, may be made. . . . Under our statute, the implied consent to be sued in this state is limited to proceedings growing out of the business transacted through the office or agency in this state. It is required that the agent shall actually receive a copy of the notice of suit and that it shall be read to him. . . . The action must grow out of the business of that very agency. Ample time is given the defendant to appear and defend ; there is not only reasonable probability' but practical moral certainty that the defendant will receive actual notice of the pendency of the action." Iowa treats the business of dealing in corporate securities as exceptional and subjects it to special regulation. Laws 1913, c. 137; Laws 1921, c. 189; Laws 1929, c. 10, approved Mar. 19, 1929. The last cited Act requires registration and written consent for service of process upon the Secretary of State. See Merrick v. Halsey & Co. 242 U. S. 568. Doherty voluntarily established an office in Iowa and there carried on this business. Considering this fact, and accepting the construction given to § 11079, we think to apply it as here proposed will not deprive him of any right guaranteed by the Federal Constitution. Flexner v. Farson, 248 U. S. 289, much relied upon, does not sustain appellant's position. There the service was made upon one not then agent for the defendants; 1here the situation is different. King was manager of the appellant's office when the sale contract was. made; also when process was served upon him. Moreover, under the laws of Iowa, neither her citizens nor non-residents could freely engage in the business of selling securities. The power of the States to impose terms upon non-residents, as to activities within their borders, recently has been much discussed. Hess v. Pawloski, 274 U. S. 352; Wuchter v. Pizzutti, 276 U. S. 13; Young v. Masci, 289 U. S. 253. Under these opinions it is established doctrine that a State may rightly direct that non-residents who operate automobiles on her highways shall be deemed to have appointed the Secretary of State as agent to accept service of process, provided there is some "provision making it reasonably probable that notice of the service on the Secretary will be communicated to the non-resident defendant who is sued." So far as it affects appellant, the questioned statute goes no farther than the principle approved by those opinions permits. Only rights claimed upon the present record are determined. The limitations of § 11079 under different circumstances we do not consider. Affirmed.2 SECTION 2 RES JUDICATA INTRODUCTORY NOTE. SOME consideration has already been given to the circumstances under which a judgment in favor of a defendant, as for example on demurrer or directed verdict, will bar a later suit by the plaintiff for the same cause of action. The principle of res judicata is, however, of broader application. In this section some further aspects of the effect of a personal judgment as res judicata in subsequent controversies will be considered. 1 See Scott, Fundamentals of Procedure (1922) 68-69. 2 See 48 Harv. L. Rev. 1433 (1935); Restatement, Judgments (1942) § 22. There are five major problems: (1) How far is the effect of a personal judgment as res judicata affected by its character? This has already been considered to some extent, and will be given brief further consideration in this note. (2) How far is a judgment res judicata as to jurisdictional matters? (3) How far is a judgment otherwise effective as res judicata a bar with respect to matters which might have been but were not litigated in the action in which the judgment was rendered? (4) What is the effect of a judgment in controversies between the parties involving a different cause of action? (5) How far does the bar of a judgment in personam affect persons other than the parties to the action? These four latter questions are considered in the cases in this section. The basic rule of the common law with respect to the effect of a personal judgment inter partes may be stated thus: If it is a judgment on the merits rendered by a court having jurisdiction, it bars a later suit on the same cause of action. If the judgment is for the plaintiff he cannot again maintain a suit on the original cause of action, but is limited to an action on the judgment. This is true even though he has mistakenly failed to claim full damages in the prior action. If the judgment is for the defendant, the plaintiff is barred from suing again on the same cause of action. Where the plaintiff recovers, his cause of action is regarded as merged in the judgment and thus extinguished; 3 if the defendant succeeds, the cause of action is likewise gone.* 5 A judgment on a verdict or after trial by the court is always on the merits. We have already considered the effect of judgments on demurrers to the evidence, on voluntary or compulsory nonsuits," and on directed verdicts. A judgment on demurrer may or may not be on the merits, as we have seen, and so of arrest of judgment. A judgment rendered on a plea in abatement or other dilatory plea is of course not on the merits.10 The student should consider the effect of a judgment for the plaintiff non obstante veredicto at common law 11 1 As to identity of cause of action, see Hoffmeier v. Trost, 83 N. J. L. 358 (1912); 2 Freeman, Judgments (5th ed. 1925) § 687; Restatement, Judgments (1942) §§ 61-67. 2 See Sanders v. Hamilton, 96 L. T. R. (N.s.) 679 (K. B. D. 1907); Ewing v. McNairy, 20 Ohio St. 315 (1870) (judgment by default); Restatement, Judgments (1942) § 47. 3 See 2 Freeman, Judgments (5th ed. 1925) § 546. 4 See Restatement, Judgments (1942) §§ 48-55. 5 See p. 345, supra, n. 1. 6 See pp. 344-346, supra. See pp. 365-366, supra. 8 See pp. 190-193, supra. 9 Cf. Louisville & Nashville R. R. Co. v. Beasley, 123 Tenn. 629 (1910). 10 Cf. 2 Freeman, Judgments (5th ed. 1925) § 733 (dismissal for want of jurisdiction). 11 See 2 Freeman, Judgments (5th ed. 1925) § 740. |