O'Neal v. Hicks Brokerage Co., 75-2280

• Decision Date: 21 July 1976
• Docket Number: No. 75-2280,75-2280
• Citation: 537 F.2d 1266
• Parties: Hobert M. O'NEAL et al., Appellants, v. HICKS BROKERAGE COMPANY and George B. Wolfe, Inc., of which Hicks Brokerage Company is, Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 1266

537 F.2d 1266

Hobert M. O'NEAL et al., Appellants, v. HICKS BROKERAGE COMPANY and George B. Wolfe, Inc., of which Hicks Brokerage Company is, Appellee.

No. 75-2280.

United States Court of Appeals Fourth Circuit.

Argued June 11, 1976.

Decided July 21, 1976.

Martin S. Driggers, Hartsville, S. C. (Saleeby, Saleeby & Cox, Hartsville, S. C., on brief), for appellants.

Hugh L. Willcox, Florence, S. C. (Willcox, Hardee, Palmer, O'Farrell, McLeod & Buyck, Florence, S. C., on brief), for appellee.

Before WINTER and BUTZNER, Circuit Judges, and CLARKE, District Judge. ^*

CLARKE, District Judge:

This appeal is taken from the Order of the District Court of South Carolina dismissing Hicks Brokerage Company (hereinafter referred to as "Hicks") as a party defendant. With the assistance of extensive discovery, the District Court concluded that defendant Hicks had insufficient South Carolina contacts to require the corporation to litigate plaintiffs' claims in a South Carolina court.

This suit arose out of an accident between two trucks in the northern part of North Carolina on January 4, 1972. Plaintiff O'Neal was the driver of one of the trucks which was owned by plaintiff Fitchett Sales Company, Inc. (hereinafter referred to as "Fitchett"). Plaintiff Snipes was a passenger in the truck driven by O'Neal. James W. Waddell, a resident of Mississippi, was operating the other truck which was owned by Kelly Stanley, also a resident of Mississippi. Plaintiff's truck was carrying motor boats. Stanley's truck was transporting cotton from Mississippi to Virginia.

Seeking damages for both property loss and personal injuries, O'Neal, Snipes and Fitchett filed this action in the United States District Court of South Carolina on July 19, 1974, against Hicks and George B. Wolfe, Inc. The Complaint alleged that Hicks was negligent in selecting the owner and operator of the truck carrying cotton. O'Neal and Snipes are residents of South Carolina and Fitchett is incorporated under the laws of South Carolina with its principal place of business in South Carolina. Hicks is incorporated and has its principal place of business in the State of Mississippi.

The issue on appeal is whether the District Court erred in finding that Hicks did not have sufficient contacts in the State of South Carolina for the courts of South Carolina to exercise in personam jurisdiction. Subsumed in this issue is whether the District Court applied the appropriate legal test in ascertaining the sufficiency of Hicks' contacts for jurisdictional purposes.

Hicks is a brokerage company hired to arrange for the transportation of cotton from Mississippi to several other states. Hicks does not own or operate the trucking equipment involved in the accident nor is it in the business of operating trucks. Hicks arranged with Stanley for the transportation of the cotton. The corporation does not maintain any offices in South Carolina. Discovery established that Hicks does not list its services with any publication distributed or available for purchase in South Carolina. The Mississippi corporation does not advertise or solicit business in South Carolina. Sales personnel are not employed to acquire brokerage business in South Carolina. Hicks' sole nexus to South Carolina is through its business relationship with a South Carolina corporation residing in Spartanburg, South Carolina. The South Carolina corporation's local representative in Mississippi contacted Hicks in that state and made arrangements for the transportation of cotton to South Carolina. The record reflects that a large portion of cotton purchased by the South Carolina corporation was shipped from Mississippi to Louisiana. From 1971 through 1974, Hicks secured the transportation for cotton to South Carolina on approximately ninety (90) occasions. However, these arrangements were always made in Mississippi with trucking firms there. Hicks' most extensive contacts with the South Carolina corporation were telephone calls between them to check the dates when cotton had been shipped. The commissions received by Hicks for its brokerage services relating to cotton shipped to South Carolina did not exceed ten thousand dollars.

International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95, provides the litmus standard for judging when a state may exercise in personam jurisdiction over a foreign corporation. The Court must scrutinize the quality and nature of the corporation's contacts with the forum state and the fairness of requiring it to proceed there consonant with the requisites of due process. International Shoe Co., supra, at 319, 66 S.Ct. 154; Lee v. Walworth Valve Company, 482 F.2d 297 (4th Cir. 1973). South Carolina has extended the jurisdiction of its courts to the outer perimeter allowed by due process. Triplett v. R. M. Wade & Co., 261 S.C. 419, 200 S.E.2d 375, 378-79 (1973); Shealy v. Challenger Mfg. Co., 304 F.2d 102, 107 (4th Cir. 1962). This Circuit has reviewed in recent years the questions of the sufficiency of state contacts necessary for in personam jurisdiction and the fairness of requiring a foreign corporation to litigate in the courts of South Carolina. Lee v. Walworth Valve Company, 482 F.2d 297 (4th Cir. 1973); Ratliff v. Cooper Laboratories, Inc., 444 F.2d 745 (4th Cir. 1971). Emanating from those...