Ahadi v. Ahadi

• Decision Date: 08 November 2001
• Docket Number: No. 13-01-222-CV,13-01-222-CV
• Citation: 61 S.W.3d 714
• Parties: (Tex.App.-Corpus Christi 2001) ABOLHASSAN AHADI , Appellant, v. SOUDABEH AHADI , Appellee
• Court: Texas Court of Appeals

Page 714

61 S.W.3d 714 (Tex.App.-Corpus Christi 2001)

ABOLHASSAN AHADI , Appellant, v. SOUDABEH AHADI , Appellee.

No. 13-01-222-CV

Court of Appeals of Texas, Corpus Christi

November 8, 2001

Rehearing Overruled December 13, 2001

On appeal from the 404th District Court of Cameron County, Texas. [Copyrighted Material Omitted]

[Copyrighted Material Omitted]

Before Justices Dorsey, Yanez, and Rodriguez

OPINION

Opinion by Justice Dorsey

Appellant, Abolhassan Ahadi, sued Alma Investments, Inc. d/b/a Texas Alma Investments, Inc., Soudabeh Ahadi, and Khalil Pakideh in the 404th District Court of Cameron County, Texas for breach of a contract to transfer fifteen percent of Alma Investments's stock to appellant. Only Soudabeh, a Michigan resident, contested personal jurisdiction through special appearance. After a hearing the trial court sustained the special appearance, and appellant brought this accelerated interlocutory appeal pursuant to Texas Civil Practices and Remedies Code section 51.014(a)(7) (Vernon Supp. 2001). The question raised on appeal is whether the district court has jurisdiction over Soudabeh Ahadi. We reverse.

I. Appellant's Evidence

Appellant, to whom we refer by his nickname, Eddie, testified at the special-appearance hearing and filed his affidavit in support of jurisdiction. Eddie has lived in Texas since 1983. His sister, Soudabeh, is a physician and resides in Michigan where she has a lucrative practice. Soudabeh and her husband, Khalil Pakideh, invested in distressed real estate, and in December, 1991, Khalil successfully bid $530,000 for the Bahia Mar Resort Hotel located on South Padre Island. He offered Eddie a fifteen-percent ownership interest in the hotel and $50,000 per year to manage the property. Eddie accepted the offer, but when Khalil refused to timely put the agreement in writing, Eddie refused to move to South Padre to manage the property. Afterwards Soudabeh called Eddie at his home in Dallas to recruit him to manage the Bahia Mar property and to convince him to accept the oral contract. She understood that he was to have a fifteen-percent ownership interest in the project and that the purchase price for his ownership interest was fifteen percent of the price paid for the property. Eddie stated:

[Soudabeh] gave me her personal word, as my sister, that, if I move[d] to South Padre and perform[ed] as agreed, our contract including my compensation and ownership interest would be reduced to writing within three or four months. Based solely upon her promise and the trust I had in her, I accepted her renewed offer. . . .

In January, 1992, Alma Investments was incorporated in Michigan and owned the Bahia Mar as its sole asset. On April 7, 1992, Khalil was at the Bahia Mar and signed a statement indicating that he had received $15,000 from Eddie as a down payment for fifteen percent of Alma Investments's stock. Eddie moved to South Padre Island and for the next eight years managed the Bahia Mar until Khalil fired him. Eddie has never received any stock in Alma Investments.

II. Soudabeh's Evidence

In support of her special appearance Soudabeh filed the affidavits of herself, Khalil, and Marianne Mitchell, who had worked at the Bahia Mar for approximately sixteen years. The gist of these affidavits is that Soudabeh (1) did not own any assets or property in Texas, (2) was never a Texas resident, (3) had never visited Texas for business purposes, (4) had no involvement in the ownership or management of Alma Investments at any time, (5) was never a shareholder, officer, director, employee, or agent of Alma Investments, (6) had no involvement in the resort's operations, and (7) had not participated in any decisions concerning the hiring or firing of employees or any financial or operational issues.

III. Standard of Review

The existence of personal jurisdiction is a question of law, but proper exercise of that jurisdiction must sometimes be preceded by the resolution of underlying factual disputes. Happy Industrial Corp. v. American Specialties, Inc., 983 S.W.2d 844, 847 (Tex. App.-Corpus Christi 1998, pet. dism'd w.o.j.). We determine the appropriateness of the trial court's resolution of those disputes by an ordinary sufficiency of the evidence review based on the entire record. Conner v. ContiCarriers & Terminals, Inc., 944 S.W.2d 405, 411 (Tex. App.-Houston [14th Dist.] 1997, no writ). If the trial court's order is based on undisputed or otherwise established facts we conduct a de novo review of the order. Id. A defendant who challenges a court's exercise of personal jurisdiction through a special appearance carries the burden of negating all bases of personal jurisdiction. Kawasaki Steel Corp. v. Middleton, 699 S.W.2d 199, 203 (Tex. 1985).

IV. Personal Jurisdiction

By six issues Eddie argues that the evidence shows that the district court had both general and specific jurisdiction over Soudabeh. Texas courts may assert jurisdiction over a nonresident defendant only (1) when the Texas long-arm statute authorizes the exercise of jurisdiction and (2) when the exercise is consistent with the due process guarantees embodied in both the United States and Texas Constitutions. CSR Ltd. v. Link, 925 S.W.2d 591, 594 (Tex. 1996) (orig. proceeding); Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 226 (Tex. 1991). The long-arm statute authorizes jurisdiction over a nonresident defendant "doing business" in Texas. Tex. Civ. Prac. & Rem. Code Ann. § 17.042 (Vernon 1997 & Supp. 2001); Guardian Royal, 815 S.W.2d at 226. Relevant to this case the Texas Civil Practices and Remedies Code characterizes nonresident activity as "doing business" in Texas when the nonresident: (1) contracts by mail or otherwise with a Texas resident and either party is to perform the contract in whole or in part in this state; and (2) recruits Texas residents, directly or through an intermediary located in this state, for employment inside or outside this state. Tex. Civ. Prac. & Rem. Code Ann. § 17.042 (Vernon 1997 & Supp. 2001).

Here the record reflects that Soudabeh called Eddie in Texas in order to recruit him to manage the Bahia Mar. She told him that if he moved to South Padre Island and performed as agreed, the contract including his compensation and ownership interest would be reduced to writing within three or four months. Based solely upon her promise and the trust Eddie had in her, he accepted her offer. Thus Soudabeh was "doing business" in Texas because she (1) contracted with Eddie, a Texas resident, and he was to perform the contract in this state, and (2) she recruited him for employment inside Texas. We hold that Eddie has satisfied the requirement for jurisdiction under the Texas long-arm statute. See Tex. Civ. Prac. & Rem. Code Ann. § 17.042 (Vernon 1997 & Supp. 2001).

Our next inquiry is whether an extension of jurisdiction would overstep the bounds of due process. The language of the long-arm statute allows an expansive reach, limited only by the federal constitutional requirements of due process. Schlobohm v. Schapiro, 784 S.W.2d 355, 357 (Tex. 1990). Therefore when the exercise of personal jurisdiction comports with federal due process limitations, requirements of the Texas long-arm statute are satisfied. Guardian Royal, 815 S.W.2d at 226.

The federal due process clause protects a person's liberty interest in not being subject to binding judgments of a forum with which that person has established no meaningful contacts, ties, or relations. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72 (1985). Under the federal constitutional test of due process a state may assert personal jurisdiction over a nonresident defendant only if (1) the defendant has purposefully established minimum contacts with the forum state, and (2) the exercise of jurisdiction comports with traditional notions of fair play and substantial justice. Id. at 476; CSR, 925 S.W.2d at 594.

A nonresident establishes minimum contacts in Texas by purposefully availing itself of the privileges and benefits inherent in conducting business within the state. CSR, 925 S.W.2d at 594; Schlobohm, 784 S.W.2d at 357-58. This requirement ensures that a nonresident defendant will be haled into court only as a result of its intentional activities, so that it is reasonable for the nonresident defendant to expect the call of a Texas court. Guardian Royal, 815 S.W.2d at 226; Schlobohm, 784 S.W.2d at 357-58.

Personal jurisdiction, therefore, does not emerge from the nonresident's random, fortuitous, or attenuated contacts with the forum, or from another's acts. Guardian Royal, 815 S.W.2d at 226. Rather the nonresident must take some action or engage in some conduct creating its own "substantial connection" with the forum state. Id.

A. Specific Jurisdiction

A defendant's minimum contacts with a forum state can produce either general or specific jurisdiction. CSR, 925 S.W.2d at 595. Specific jurisdiction is established if the defendant's alleged liability arises from or is related to an activity conducted within the forum. CSR, 925 S.W.2d at 595. See Guardian Royal, 815 S.W.2d at 227. The defendant must have purposefully directed his activities toward the forum state. Id. at 228. The number of the defendant's contacts with the forum is not controlling; rather, the importance lies with the quality and nature of these contacts. Texas Commerce Bank v. Interpol '80 Ltd. Partnership, 703 S.W.2d 765, 772 (Tex. App.-Corpus Christi 1985, no writ). The minimum-contacts analysis focuses on the relationship among the defendant, the forum, and the litigation. Guardian Royal, 815 S.W.2d at 226.

Even when a nonresident has a single contact with Texas our courts can exercise specific jurisdiction if the suit arises out of that sole contact. Memorial Hosp. Sys. v. Fisher Ins. Agency, Inc., 835 S.W.2d 645, 650 (Tex. App.-Houston [14th Dist.] 1992, no writ). A substantial connection must exist between the contact and...