Amquip Corp. v. Cloud

• Decision Date: 07 February 2002
• Docket Number: No. 01-00-01246-CV.,01-00-01246-CV.
• Citation: 73 S.W.3d 380
• Parties: AMQUIP CORPORATION, Appellant, v. Paris CLOUD, Appellee.
• Court: Texas Court of Appeals

73 S.W.3d 380

AMQUIP CORPORATION, Appellant, v. Paris CLOUD, Appellee.

No. 01-00-01246-CV.

Court of Appeals of Texas, Houston (1st Dist.).

February 7, 2002.

Debra E. Ibarra, Nathan Montgomery Rymer, Marvin C. Moos, Chastiti Nycole Horne, Smith, Rymer, Moore, Moos, P.C., Houston, for Appellant.

Garland Keith Grady, Houston, for Appellee.

Panel consists of Chief Justice SCHNEIDER and Justices WILSON and JENNINGS.

OPINION

JENNINGS, Justice.

This is an accelerated appeal from the trial court's denial of a special appearance filed by the appellant, AmQuip Corporation. AmQuip presents two issues on appeal: (1) the trial court erred in denying AmQuip's special appearance, and (2) the trial court erred in overruling AmQuip's objections to evidence offered by the appellee, Paris Cloud, in response to the special appearance.

We reverse and render.

Factual and Procedural Background

Paris Cloud brought a personal injury lawsuit against Parsons Energy & Chemicals Group, Inc. a/k/a Parsons Project Group, Inc. ("Parsons") and AmQuip Corporation ("AmQuip") seeking recovery for damages arising from a job site accident which occurred on February 24, 1999, in Delaware City, Delaware. Parsons, the general contractor on the job site, subcontracted with AmQuip to rent, assemble, and disassemble an 800-ton crane at the job site. Cloud alleges he was injured during the disassembly of the crane's back-mast when an employee of AmQuip improperly operated a forklift, causing a pennant line to strike Cloud in the leg and injure him. Cloud was an employee of Davenport-Mammoet, another subcontractor, who is not a party to this case.

Cloud is a Texas resident. Parsons is a Texas corporation. AmQuip is a Pennsylvania corporation, and filed a general denial, subject to a special appearance. In its special appearance, AmQuip asserted the trial court lacked jurisdiction over it because AmQuip is a nonresident and does not have sufficient minimum contacts to Texas.

As evidence in support of its special appearance, AmQuip produced affidavits of its chief financial officer, Robert Daubert. In his affidavits, Daubert stated AmQuip (1) is a Pennsylvania corporation, (2) does not maintain a place of business in Texas, (3) does not have any employees or agents in Texas, (4) does not conduct or transact business in Texas, (5) does not have any bank accounts in Texas, (6) does not maintain any salesmen or representatives in Texas, (7) does not have a registered agent for process in Texas, (8) does not own real property in Texas, (9) did not commit a tort in Texas, (10) did not execute any contract for the rental of cranes in Texas, and (11) did not recruit Texas residents, directly or through an intermediary, for employment.

The parties engaged in discovery, solely on the issue of jurisdiction, and deposed Daubert. Cloud then filed a response to the special appearance. After a hearing, the trial court denied AmQuip's special appearance. AmQuip requested, but the trial court did not prepare, findings of fact and conclusions of law.

Standard of Review

The burden of proof is on a nonresident to negate all possible grounds for personal jurisdiction. Kawasaki Steel Corp. v. Middleton, 699 S.W.2d 199, 203 (Tex.1985); Garner v. Furmanite Australia Pty., Ltd., 966 S.W.2d 798, 802 (Tex App.-Houston [1st Dist.] 1998, pet. denied). Existence of personal jurisdiction is a question of law, but that determination must sometimes be preceded by the resolution of underlying factual disputes. Preussag Aktiengesellschaft v. Coleman, 16 S.W.3d 110, 113 (Tex.App.-Houston [1st Dist.] 2000, pet. dism'd w.o.j.); James v. Illinois Cent. R.R. Co., 965 S.W.2d 594, 596 (Tex.App.-Houston [1st Dist.] 1998, no pet.). We review the trial court's decision de novo when, as here, the underlying facts are undisputed or otherwise established. Preussag, 16 S.W.3d at 113; C-Loc Retention Sys., Inc. v. Hendrix, 993 S.W.2d 473, 476 (Tex.App.-Houston [14th Dist.] 1999, no pet.). The facts in the case before us are largely undisputed, although the parties urge us to interpret them differently.

Jurisdiction

Rule 120a allows a party to appear specially, without making a general appearance, to object to the court's exercise of jurisdiction over it, "on the ground that such party or property is not amenable to process issued by the courts of this State." TEX.R. CIV. P. 120a; Abacan Technical Servs. Ltd. v. Global Marine Int'l Servs. Corp., 994 S.W.2d 839, 843 (Tex.App.-Houston [1st Dist.] 1999, no pet.). The words "not amenable to process" mean that the special appearance is available solely to establish that the Texas court cannot, under the federal and state constitutions and the applicable state statutes, validly obtain jurisdiction over the person or property of the defendant with regard to the cause of action pled. GFTA Trendanalysen B.G.A. Herrdum GMBH & Co., K.G. v. Varme, 991 S.W.2d 785, 786 (Tex.1999).

A court may assert personal jurisdiction over a nonresident defendant only if the requirements of both the Fourteenth Amendment's due process clause¹ and the Texas long-arm statute² are satisfied. CSR, Ltd. v. Link, 925 S.W.2d 591, 594 (Tex.1996) (orig. proceeding); Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 413, 104 S.Ct. 1868, 1871, 80 L.Ed.2d 404 (1984). The Texas long-arm statute reaches as far as the federal and state constitutional guarantees of due process allow. Garner, 966 S.W.2d at 802.

The Texas long-arm statute allows a court to exercise personal jurisdiction over a nonresident defendant who does business in Texas. Tex. Civ. Prac. & Rem.Code Ann. § 17.042 (Vernon 1997).

A nonresident does business in Texas if it:

(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;

(2) commits a tort in whole or in part in this state; or

(3) 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). In addition to the items on this list, the statute provides that "other acts" by the nonresident can satisfy the requirement of "doing business" in Texas. Id.; Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 226 (Tex.1991). The Texas Supreme Court has repeatedly interpreted this broad statutory language "to reach as far as the federal constitutional requirements of due process will allow." CSR, 925 S.W.2d at 594. Therefore, the requirements of the Texas long-arm statute are satisfied if the exercise of personal jurisdiction comports with federal due process limitations. Id.

The United States Constitution permits a state to exert personal jurisdiction over a nonresident defendant only if the defendant has some minimum, purposeful contacts with the state, and the exercise of jurisdiction will not offend traditional notions of fair play and substantial justice. Dawson-Austin v. Austin, 968 S.W.2d 319, 326 (Tex.1998). A nonresident who has purposefully availed himself of the privileges and benefits of conducting business in the foreign jurisdiction has sufficient contacts with the forum to confer personal jurisdiction. CSR, 925 S.W.2d at 594; Garner, 966 S.W.2d at 803. A defendant, however, should not be subject to the jurisdiction of a foreign court based upon random, fortuitous, or attenuated contacts. CSR, 925 S.W.2d at 595.

A nonresident defendant must have purposefully established such minimum contacts with the forum that it could reasonably anticipate being sued there. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 2183, 85 L.Ed.2d 528 (1985). If the nonresident defendant has purposefully availed itself of the privileges and benefits of conducting business in a state, it has sufficient contacts to confer personal jurisdiction. Id. Random, fortuitous, or attenuated contacts do not suffice. Id. Neither do unilateral actions by third parties claiming some relationship with the nonresident defendant. Id. It is the quality and nature of the contacts, rather than their number, that is important. Guardian Royal, 815 S.W.2d at 230 n. 11.

A defendant's contacts with a forum can give rise to either general or specific jurisdiction. Id. at 227. General jurisdiction is present when a defendant's contacts are continuous and systematic, allowing the forum to exercise personal jurisdiction over the defendant even if the cause of action did not arise from or relate to activities conducted within the forum state. Id. at 228. General jurisdiction requires a showing that the defendant conducted substantial activities within the forum, a more demanding minimum contacts analysis than for specific jurisdiction. Id. Specific jurisdiction, however, is established if the defendant's alleged liability arises from or is related to an activity conducted within the forum. Id. at 227. When specific jurisdiction is asserted, the minimum contacts analysis focuses on the relationship between the defendant, the forum, and the litigation. Memorial Hosp. Sys. v. Fisher Ins. Agency, Inc., 835 S.W.2d 645, 650 (Tex.App.-Houston [14th Dist.] 1992, no writ).

The exercise of personal jurisdiction is proper when the contacts proximately result from actions of the nonresident defendant which create a substantial connection with the forum state. Guardian Royal, 815 S.W.2d at 226. The substantial connection between the nonresident defendant and the forum state necessary for a finding of minimum contacts must come about by action or conduct of the nonresident purposefully directed toward the forum state. Id. This requirement that a defendant purposefully avail himself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws, ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts, or of the...