Shute v. Carnival Cruise Lines

• Decision Date: 07 December 1989
• Docket Number: No. 56089-7,56089-7
• Citation: 783 P.2d 78,113 Wn.2d 763
• Parties: . CARNIVAL CRUISE LINES, Appellee. Supreme Court of Washington, En Banc
• Court: Washington Supreme Court

Page 763

113 Wn.2d 763

783 P.2d 78

Certification from the United States Court of Appeals for

the Ninth Circuit in Eulala SHUTE and Russel

Shute, Appellants, v. CARNIVAL CRUISE LINES, Appellee.

No. 56089-7.

Supreme Court of Washington,

En Banc.

Dec. 7, 1989.

Wall & Hinrichs, Gregory J. Wall, Seattle, for appellants.

Bogle & Gates, Jonathan Rodriguez-Atkatz, Seattle, for appellee.

SMITH, Justice.

A Washington resident, injured on a cruise ship in international waters off the coast of Mexico, brought suit against the cruise operator, a Panamanian corporation with its principal place of business in Florida, under the Washington "long-arm" statute, RCW 4.28.185. The United States Court of Appeals for the Ninth Circuit certified to this court the question whether personal jurisdiction over the cruise ship operator exists under the statute. Unless limited by the terms of the statute, our courts may assert jurisdiction over nonresident defendants to the extent permitted by federal due process. We therefore answer the certified question "yes."

The sole question presented by this case is whether a claim for negligent injury occurring on an ocean cruise ship in international waters can be said, within the meaning of our state's long-arm statute, to "arise from" advertisement and promotion in Washington of its cruises by a foreign corporation.

Appellee Carnival Cruise Lines, Inc. (Carnival), is a Panamanian corporation with its principal place of business in Florida. Appellants Eulala and Russel Shute are Washington residents who purchased ocean cruise fares from Carnival through a Snohomish County travel agency in March 1986.

The cruise ship, the M/V Tropicale, embarked from Los Angeles, California, on April 13, 1986, en route to Mexico. On April 15, 1986, during a guided tour of the ship's galley, Mrs. Eulala Shute slipped, fell, and was injured. The ship was in international waters off the coast of Mexico at the time. The Shutes filed this case as an action in Admiralty in the United States District Court for the Western District of Washington.

The trial court, the Honorable Carolyn R. Dimmick, by order dated June 25, 1987, granted summary judgment in favor of Carnival, dismissing the claim because the cause of action did not "arise out of" or "result from" the defendant's contacts with the state of Washington.

In its opinion, issued December 12, 1988, the United States Court of Appeals for the Ninth Circuit reversed the District Court. Shute v. Carnival Cruise Lines, 863 F.2d 1437 (9th Cir.1988), withdrawn, 872 F.2d 930 (1989). Carnival moved for reconsideration. While that motion was pending, on February 6, 1989, the Washington Court of Appeals, Division One, issued its opinion in Banton v. Opryland U.S.A., Inc., 53 Wash.App. 409, 767 P.2d 584 (1989), interpreting the Washington long-arm statute and finding no jurisdiction on facts comparable to those in the Shutes' case. The United States Court of Appeals then withdrew its opinion and, by order dated April 24, 1989, certified the following question to this court:

Would the Washington long-arm statute establish personal jurisdiction over Carnival Cruise Lines for the claim asserted by the Shutes?

Carnival's only contacts with the State of Washington consist of advertisements in Washington newspapers, promotional materials provided to Washington travel agencies, and seminars conducted by Carnival's personnel for travel agencies in promotion of its cruises. Carnival maintains no office, owns no real estate in the state of Washington, and has no Washington business license.

The tickets issued by Carnival contained contract clauses designating Florida as the forum for any litigation. They were issued in Florida and forwarded to Washington. Carnival provided neither transportation nor services to the Shutes before they boarded the M/V Tropicale in Los Angeles. There is no indication that the M/V Tropicale nor any of Carnival's other vessels has ever called at a Washington port.

The United States Court of Appeals for the Ninth Circuit concluded in this case that although due process does not permit general jurisdiction, it does permit specific jurisdiction. Shute v. Carnival Cruise Lines, 863 F.2d 1437 (9th Cir.1988), withdrawn, 872 F.2d 930 (1989). ¹ Thus, the only inquiry remaining for this court is whether Washington's long-arm statute precludes jurisdiction on the facts of this case. See Grange Ins. Ass'n v. State, 110 Wash.2d 752, 756, 757 P.2d 933 (1988).

The "long-arm" statute, RCW 4.28.185(1)(a) provides in relevant part:

(1) Any person, whether or not a citizen or resident of this state, who in person or through an agent does any of the acts in this section enumerated, thereby submits said person ... to the jurisdiction of the courts of this state as to any cause of action arising from the doing of any of said acts:

(a) The transaction of any business within this state;

It is well established in Washington "that under the long-arm statute, RCW 4.28.185, our courts may assert jurisdiction over nonresident individuals and foreign corporations to the extent permitted by the due process clause of the United States Constitution, except as limited by the terms of the statute." Deutsch v. West Coast Mach. Co., 80 Wash.2d 707, 711, 497 P.2d 1311, cert. denied, 409 U.S. 1009, 93 S.Ct. 443, 34 L.Ed.2d 302 (1972). We are thus asked to determine what limits are provided by the statute.

Our long-arm statute is patterned after the Illinois statute. Tyee Constr. Co. v. Dulien Steel Prods., Inc., 62 Wash.2d 106, 109, 381 P.2d 245 (1963). The Illinois statute "reflects on the part of the legislature 'a conscious purpose to assert jurisdiction over nonresident defendants to the extent permitted by the due-process clause.' " Tyee Constr. Co. v. Dulien Steel Prods., Inc., 62 Wash.2d 106, 109, 381 P.2d 245 (1963) (quoting Nelson v. Miller, 11 Ill.2d 378, 389, 143 N.E.2d 673 (1957)). See also E. Cleary & A. Seder, Extended Jurisdictional Bases for the Illinois Courts, 50 Nw.U.L.Rev. 599 (1956). The same has been said of RCW 4.28.185. See, e.g., Note, In Personam Jurisdiction Expanded--Force and Effect of Service of Process Outside of State, 34 Wash.L.Rev. 323, 326, 329 (1959). We interpret the statute relying upon this conceptual foundation.

In order to subject nonresident defendants and foreign corporations to the in personam jurisdiction of this state under RCW 4.28.185(1)(a), the following factors must coincide:

(1) The nonresident defendant or foreign corporation must purposefully do some act or consummate some transaction in the forum state;

(2) the cause of action must arise from, or be connected with, such act or transaction; and

(3) the assumption of jurisdiction by the forum state must not offend traditional notions of fair play and substantial justice, consideration being given to the quality, nature, and extent of the activity in the forum state, the relative convenience of the parties, the benefits and protection of the laws of the forum state afforded the respective parties, and the basic equities of the situation.

Deutsch v. West Coast Mach. Co., 80 Wash.2d 707, 711, 497 P.2d 1311, (citing Oliver v. American Motors Corp., 70 Wash.2d 875, 425 P.2d 647 (1967) and Tyee Constr. Co. v Dulien Steel Prods., Inc., 62 Wash.2d 106, 381 P.2d 245 (1963)), cert. denied, 409 U.S. 1009, 93 S.Ct. 443, 34 L.Ed.2d 302 (1972). In Werner v. Werner, 84 Wash.2d 360, 365, 526 P.2d 370 (1974), the court noted that:

These factors are, in part, a distillation of the due process standards announced in International Shoe Co. v. Washington, [326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95, 161 A.L.R. 1057 (1945) ], and refined in Hanson v. Denckla, [357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958) ]; Travelers Health Ass'n v. Virginia, 339 U.S. 643, 70 S.Ct. 927, 94 L.Ed. 1154, (1950); Perkins v. Benguet Consol. Mining Co., 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed. 485 (1952); McGee v. International Life Ins. Co., 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957).

Thus, when the federal courts regard the due process standard and the statutory standard under RCW 4.28.185 as a single inquiry, ² it is based upon a concept firmly rooted in our case law.

The United States Court of Appeals for the Ninth Circuit concluded that Carnival's actions were more than sufficient to satisfy the requirements of due process. Shute v. Carnival Cruise Lines, 863 F.2d 1437, 1442 (9th Cir.1988), withdrawn, 872 F.2d 930 (1989). Carnival's solicitation of business in this state was purposefully directed at Washington residents. We find this sufficient to constitute a "purposeful act" under the first prong of our statutory test.

The federal appellate court also concluded that "jurisdiction over Carnival is reasonable in this case." Shute v. Carnival Cruise Lines, 863 F.2d 1437, 1446 (9th Cir.1988), withdrawn, 872 F.2d 930 (1989). We agree. Given Carnival's efforts to exploit the Washington market, we cannot say that it would offend "traditional notions of fair play and justice" for Washington to assert jurisdiction. Thus, the third prong of our statutory test is satisfied.

As a result of the holdings by the trial and appellate courts in Shute and by our Court of Appeals in Banton this case turns on the second prong of our statutory test--whether the Shutes' claim "arises from" Carnival's promotional efforts in Washington within the meaning of RCW 4.28.185.

Our statutory test, first announced in Tyee Constr. Co. v. Dulien Steel Prods., Inc., 62 Wash.2d 106, 381 P.2d 245 (1963), was adapted from a law review case note. See Tyee Constr. Co. v. Dulien Steel Prods., Inc., 62 Wash.2d 106, 115 n. 1, 381 P.2d 245 (1963). In considering whether a cause of action "arises from" a party's contacts with a forum state, the article anticipated that a "cause of action might come to fruition in another state, but because of activities of defendant in the forum state there would still be a 'substantial minimum...