Federal Nat. Bank & Trust Co. of Shawnee v. Moon, Civ. No. 75-0760-D.

• Decision Date: 24 February 1976
• Docket Number: Civ. No. 75-0760-D.
• Citation: 412 F. Supp. 644
• Parties: The FEDERAL NATIONAL BANK & TRUST CO. OF SHAWNEE, a National Banking Association, Plaintiff, v. Winfield MOON and Theolene Moon, husband and wife, Defendants.
• Court: U.S. District Court — Western District of Oklahoma

412 F. Supp. 644

The FEDERAL NATIONAL BANK & TRUST CO. OF SHAWNEE, a National Banking Association, Plaintiff, v. Winfield MOON and Theolene Moon, husband and wife, Defendants.

Civ. No. 75-0760-D.

United States District Court, W. D. Oklahoma, Civil Division.

February 24, 1976.

Richard L. Bohanon, Oklahoma City, Okl., for plaintiff.

Dewayne N. Morris, Birmingham, Ala., for defendants.

ORDER

DAUGHERTY, Chief Judge.

Plaintiff is a National Bank with its principal place of business in Shawnee, Oklahoma. Defendants are citizens and residents of the State of Alabama. The instant action arises from Defendants having guaranteed a loan obtained by a corporation from an Oklahoma lending company. The note and guarantee in question have been assigned to Plaintiff which brings this action against the guarantors for the balance due on said debt after the corporate borrower has defaulted and in fact has been adjudicated a bankrupt. In its Complaint, Plaintiff asserts Defendants have transacted business in Oklahoma, have contracted to pay debts in this State and further have committed acts within the State of Oklahoma in relation to the claim herein so as to subject Defendants to the jurisdiction of the Oklahoma Courts pursuant to 12 Oklahoma Statutes §§ 187 and 1701.03 commonly known as the "long-arm" statutes.

Defendants have filed separate Motions to Quash in which they assert they are not subject to the in personam jurisdiction of this Court. Motions to Quash are improper in Federal practice and same will be considered Motions to Dismiss for lack of in personam jurisdiction pursuant to Rule 12(b)(2), Federal Rules of Civil Procedure. Product Promotions, Inc. v. Cousteau, 495 F.2d 483 (Fifth Cir. 1974). Both Movants by their verified Motions¹ state the entire transaction was negotiated in Alabama and the documents were delivered to Oklahoma by an agent of the lending company. Defendant Theolene Moon also asserts she was never in Oklahoma in connection with the transaction. Defendants recognize the applicability of the Oklahoma long-arm statutes but assert they have not transacted business in Oklahoma in connection with the loan and guaranty agreement which gives rise to the instant action.

Plaintiff in its Response contends the loan was closed in Oklahoma and Defendant Winfield Moon delivered the closing papers to Oklahoma and received the loan proceeds in Oklahoma. It asserts this Defendant was acting as agent for his Co-Defendant in the transaction. It attaches an affidavit by the officer or agent of the lending company in support of such factual contention. Plaintiff argues that the totality of contacts involved with the State of Oklahoma subject Defendants to the jurisdiction of the Oklahoma courts.

For the purposes of considering the instant Motion, the Court finds that it will accept all facts alleged by the Defendants as true.² These include: (1) That negotiations for the loan guaranteed by Defendants were conducted in Alabama; (2) That Defendant Theolene Moon never came to the State of Oklahoma in connection with the loan in question; and (3) The documents were executed in the State of Alabama. The parties are correct that in diversity cases this Court looks to the Oklahoma long-arm statutes in determining whether it has in personam jurisdiction over non-residents. Wilshire Oil Company of Texas v. Riffe, 409 F.2d 1277 (Tenth Cir. 1969).

Plaintiff in its Response states it specifically relies on the provisions of 12 Oklahoma Statutes § 1701.03 which provide:³

"(a) A court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a cause of action or claim for relief arising from the person's:

(7) maintaining any other relation to this state or to persons or property . . which affords a basis for the exercise of personal jurisdiction by this state consistently with the Constitution of the United States."

Said statute has been interpreted by the Oklahoma Supreme Court in Vemco Plating, Inc. v. Denver Fire Clay Company, 496 P.2d 117 (Okl.1972) as follows:

"As this statute was intended `to extend the jurisdiction of Oklahoma courts over nonresidents to the outer limits permitted by the' United States Constitution's due process requirements and is to be construed `to widen the constitutional bases upon which the courts of the states may exercise in personam jurisdiction consistent' with these requirements." Citations omitted

The "constitutional limits" in question are delineated in the landmark cases of International Shoe Company v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945); Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958); and McGee v. International Life Insurance Company, 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957). The basic tests derived from said landmark cases include determining whether a nonresident's activities meet the "minimum contacts" rule established therein and the standards of "fair play and substantial justice." Carmack v. Chemical Bank New York Trust Co., 536 P.2d 897 (Okl.1975).

In Crescent Corporation v. Martin, 443 P.2d 111 (Okl.1968) the Court stated:

"The question of application of the long-arm statute of necessity (if the same is to be accorded its full effect) depends on the totality of the contacts with Oklahoma."

The "totality of contacts within the state" doctrine was applied in Carmack v. Chemical Bank New York Trust Co., supra. What are Defendant's contacts with the State of Oklahoma in regard to the events giving rise to the instant litigation? One very dominant contact that appears to be present is that the Defendants guaranteed the payment of a loan made by an Oklahoma lending institution which has been assigned to another such institution also located in Oklahoma. Even if the negotiations for said loan were made in another state as contended by Defendants, the "source" of the money for the loan in question comes from the State of Oklahoma. It is the consummation of the loan process and not the negotiations for same which give rise to the instant action against the guarantors of said loan.

Although Defendant Winfield Moon in his Brief states he does not deny coming to Oklahoma in connection with the loan in question, Defendant Theolene Moon denies being present in Oklahoma for such purposes. In Colorado-Florida Living, Inc. v. Deltona Corporation, 338 F.Supp. 880 (D.Colo.1972) the Court stated in construing a long-arm statute very similar to the Oklahoma long-arm statutes as...