Arnold v. Long
| Decision Date | 16 September 2016 |
| Docket Number | No. 09A02–1511–PL–2101.,09A02–1511–PL–2101. |
| Citation | 59 N.E.3d 1075 |
| Parties | Jerry ARNOLD d/b/a Arnold's Jewelry and Gifts, Inc., Appellant–Plaintiff, v. Marcellus LONG, Jr., Marcellus Long, Jr., P.C. a/k/a Law Office of Marcellus Long, P.L.L.C., and Hatchett Dewalt & Hatchett, P.L.L.C. a/k/a Hatchett DeWalt & Hatchett, P.C., Appellees–Defendants. |
| Court | Indiana Appellate Court |
Matthew D. Barrett, Logansport, IN, Attorney for Appellant.
Patrick E. Chavis, III, Indianapolis, IN, Attorneys for Appellee.
[1] Appellant–Plaintiff, Jerry Arnold d/b/a Arnold's Jewelry and Gifts, Inc. (Arnold), appeals the grant of a motion to dismiss made by Appellees–Defendants, Marcellus Long Jr.; Marcellus Long Jr. P.C. a/k/a law office of Marcellus Long PLLC (Long); and Hatchett DeWalt & Hatchett PLLC (Hatchett DeWalt) (collectively, Appellees).
[2] We affirm.
[3] Arnold raises three issues on appeal, one of which we find dispositive and restate as: Whether the trial court properly dismissed Arnold's Complaint for lack of personal jurisdiction.
[4] Arnold is engaged in the business of selling jewelry and specialty gifts in Logansport, Indiana. Long is a licensed attorney in the State of Michigan, and his law office is located at 485 Orchard Lake Road, Pontiac, Michigan. Hatchett DeWalt is a Michigan law firm engaged in the practice of law with an office located at 485 Orchard Lake Road, Pontiac, Michigan. “Long was an employee, agent, member, and/or servant acting within the scope of his employment, partnership, joint venture, and/or association with [ ] Hatchett DeWalt with respect to the subject matter” of Arnold's Complaint. (Appellant's App. p. 11).
[5] Michigan Commercial Resource Locator, Inc. (Michigan Commercial) is a Michigan corporation with an office in Detroit, Michigan, and is engaged in the business of facilitating commercial mortgage loans and other commercial real estate debt. When Arnold wanted to expand his business, a mortgage broker referred him to Sabastian Restum a/k/a Sam Ajami (Restum)—an agent of Michigan Commercial. Through Restum, Michigan Commercial agreed to obtain lenders to loan Arnold $850,000.00 through a secured line of credit. In accordance with that arrangement, Michigan Commercial lawyer's, the Appellees, actively negotiated and drafted several loan documents which included a Term Sheet Agreement, Facilitation Agreement, and Non–Compete Agreement. Pursuant to the Facilitation Agreement, Arnold agreed to pay Michigan Commercial a loan processing fee of $20,700 upon signing the loan documents. Clause 3D of the Facilitation Agreement stated that the fee was “to be used for all costs associated with obtaining the loan including but not limited to appraisal cost, survey costs, environmental costs, and title insurance fees.” (Appellant's App. p. 29). That clause further stated that if Michigan Commercial “does not close the loan for any reason, all fees will be refunded.” (Appellant's App. p. 29).
[6] On September 23, 2013, Jim Jarvis (Jarvis), Michigan Commercial's agent, travelled from Michigan to Arnold's jewelry shop in Indiana to obtain Arnold's signature on the loan agreements. Two days after he signed the loan documents, on September 25, 2013, Arnold sent a cashier's check for $20,700 to the Appellees, and it was subsequently deposited by the Appellees into an Interest on Lawyer Trust Account (IOLTA) at a PNC Bank in Pontiac, Michigan. Sometime thereafter, Restum communicated to Arnold that Michigan Commercial had successively found possible lenders and the loan was bound to close on April 25, 2014.
(Appellant's App. p. 39). Sometime after the Appellees' letter, a Federal Bureau of Investigation (FBI) agent contacted Arnold and advised him that he had been a victim of fraud by Appellees. The FBI agent advised Arnold that Restum and several others had been taken into custody for federal criminal charges involving mail and wire fraud and conspiracy to commit wire fraud. On May 28, 2014, Restum was charged with wire fraud in violation of 18 U.S.C. §§ 1343 and 1349. The complaint focused on an illegal advance fee scheme operated by Restum and several others. Specifically, the complaint alleged that in executing the scheme to defraud, Restum and several others represented that Michigan Commercial acted as a “facilitator” in procuring large commercial loans from non-conventional lenders having an 80% success rate in closing such loans. Once a party agreed to apply for a commercial loan, they were required to pay a loan processing fee to Michigan Commercial before being funded. Arnold was informed that he had to pay $50,000 as an upfront fee, but when he indicated that he could not afford that, the fee was reduced by half. Thereafter, on September 25, 2013, Arnold purchased a cashier's check and addressed it to Long's firm. On April 9, 2014, Restum represented to Arnold that the loan would close on April 25, 2014.
[8] Based on the fact that the loan had not closed on its proposed date, on June 30, 2014, Arnold, through his lawyer, sent a demand letter to the Appellees demanding a refund of the entire $20,700.00. The letter stated, in part:
[9] Not having heard from the Appellees, on January 22, 2015, Arnold filed a Complaint, alleging breach of contract, fraud, conversion, negligence, and unjust enrichment. On March 26, 2015, Arnold filed an Amended Complaint. On April 13, 2015, the Appellees responded by filing a Motion to Dismiss for Want of Personal Jurisdiction. On May 5, 2015, Arnold filed his response in opposition to the Appellees' motion. On July 9, 2015, a hearing was held on the Appellees' motion. At the start of the hearing, Arnold's counsel requested to present evidence in the form of oral testimony from Arnold. The trial court agreed, but the Appellees' counsel objected on the basis that Indiana Trial Rule 4.4 “does not contemplate an evidentiary hearing.” (Transcript p. 8). The trial court sustained the objection, but allowed Arnold's counsel to proffer Arnold's anticipated testimony had he been allowed to testify. After counsels presented their oral arguments, the trial court took matter under advisement. Thereafter, the parties filed their proposed findings of facts and conclusions of law, and on November 13, 2015, the trial court entered an Order granting the Appellees' motion to dismiss, and it issued findings of fact and conclusions thereon.
[10] Arnold now appeals. Additional facts will be provided as necessary.
[11] Arnold contends that the trial court erred in granting the Appellees' motion to dismiss for lack of jurisdiction. A motion to dismiss pursuant to T.R. 12(B)(2) is a proper method of challenging the personal jurisdiction of a trial court. Lee v. Goshen Rubber Co., Inc., 635 N.E.2d 214, 215 (Ind.Ct.App.1994), trans. denied. Personal jurisdiction is a question of law. LinkAmerica Corp. v. Albert, 857 N.E.2d 961, 965 (Ind.2006). Therefore, our review is de novo, and we do not defer to the trial court's legal conclusion as to whether personal jurisdiction exists. Id. However, to the extent that the issue of personal jurisdiction turns on disputed facts, the trial court's findings of fact are reviewed for clear error. Id.
[12] Personal jurisdiction refers to a court's power to impose judgment on a particular defendant. Boyer v. Smith, 42 N.E.3d 505, 509 (Ind.2015). Indiana Trial Rule 4.4(A) serves as Indiana's long-arm statute governing the extent of personal jurisdiction. It provides in part that “a court of this state may exercise jurisdiction on any basis not inconsistent with the Constitutions of this state or the United States.” Ind. Trial Rule 4.4(A). This provision “was intended to, and does, reduce analysis of personal jurisdiction to the issue of whether the exercise of personal jurisdiction is consistent with the Federal Due Process Clause.” LinkAmerica Corp., 857 N.E.2d at 967.
[13] Before an Indiana court can properly assert personal jurisdiction over a defendant, the Due Process Clause of the Fourteenth Amendment requires that the defendant have certain “minimum contacts” with the state “such that the maintenance of the suit does not offend traditional notions of fair...
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