BHP De Venezula, C.A. v. Casteig

• Decision Date: 27 May 1999
• Docket Number: No. 13-98-624-CV,13-98-624-CV
• Parties: (Tex.App.-Corpus Christi 1999) BHP DE VENEZULA, C.A., A/K/A BHP VENCA, Appellant, v. EUGENE PAUL CASTEIG, Appellee
• Court: Texas Court of Appeals

Page 321

994 S.W.2d 321 (Tex.App.-Corpus Christi 1999)

BHP DE VENEZULA, C.A., A/K/A BHP VENCA,Appellant, v. EUGENE PAUL CASTEIG,Appellee.

No. 13-98-624-CV

COURT OF APPEALS THIRTEENTH DISTRICT OF TEXAS CORPUS CHRISTI

May 27, 1999

On appeal from the 214th District Court of Nueces County, Texas. [Copyrighted Material Omitted]

[Copyrighted Material Omitted]

Before Justices Dorsey, Hinojosa, and Rodriguez

OPINION ON MOTION FOR REHEARING

Rodriguez, J

Opinion by Justice Rodriguez

We overrule appellee's motion for rehearing, withdraw our opinion dated May 6, 1999, and substitute the following opinion in its place.

Appellee Eugene Casteig brought suit in Nueces County against BHP Engineering and Consulting ("E&C")¹ and BHP de Venezuela ("Venca") claiming he was entitled to unemployment benefits under Venezuelan law for consulting services he performed in Venezuela. Venca filed a special appearance, which the trial court denied. This is an interlocutory appeal from that denial.² We reverse the trial court's order and dismiss for lack of personal jurisdiction.

Venca is a foreign corporation organized and established under Venezuelan law. Its corporate residence and principal place of business are in Venezuela. It was formed in January 1992 with E&C as a 19% shareholder. Venca was formed to provide engineering services to companies in Venezuela. Venca has conducted no business since 1994.

E&C is incorporated in the state of Texas and has offices in Nueces and Victoria Counties, Texas.

The day-to-day operations of Venca were coordinated by Alejandro Garcia and Joe Burch. Burch was the president of Venca and the secretary/treasurer of E&C. It is undisputed that Burch was a Texas resident. It is further undisputed that Burch assisted in the day-to-day operations of Venca while he was located in Venezuela.

E&C and Venca entered into a Technical Services Agreement ("Agreement") which provided, inter alia, that Venca may request that E&C send qualified professionals to Venezuela to assist Venca on various projects as needed. Venca could also send personnel to Texas for training. The Agreement further provided that E&C would assist Venca in acquiring equipment needed for its projects. The Agreement was entered into in Venezuela, was registered in Venezuela, and chose Maracaibo, Venezuela as its domicile for all matters arising under the contract.

Eugene Casteig was an employee of E&C. Pursuant to the Agreement, E&C sent Casteig to Venezuela to assist Venca on its engineering projects. Venca paid E&C for Casteig's services. When Venca closed its doors, there obviously was no longer a need to have Casteig in Venezuela and he was instructed to return to Texas.

Under the Agreement, E&C sold approximately $95,000 worth of equipment to Venca. This equipment was delivered to Venca in Venezuela with payment being made to E&C's account at a Venezuelan bank.

On July 29, 1996, Casteig filed suit for breach of an employment contract and wrongful termination against E&C and Venca. Venca filed a special appearance, which the trial court denied. Venca appeals the denial of its special appearance.

In issues one, thirteen, and fourteen, Venca argues the trial court erred in denying its special appearance.

In Texas, personal jurisdiction over a nonresident defendant is proper only if the requirements of both the Due Process Clause of the Fourteenth Amendment to the U.S. Constitution and the Texas long-arm statute are satisfied. See U.S. CONST. amend. XIV, 1; TEX. CIV. PRAC. & REM. CODE ANN. 17.042 (Vernon 1997); Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408, 413-14, 104 S.Ct. 1868 (1984); CSR Ltd. v. Link, 925 S.W.2d 591, 594 (Tex. 1996); J&J Marine, Inc. v. Le, 982 S.W.2d 918, 923 (Tex. App.--Corpus Christi 1998, no pet. h.). The Texas long-arm statute permits a court to exercise personal jurisdiction over a nonresident defendant doing business in Texas. TEX. CIV. PRAC. & REM. CODE ANN. 17.042 (Vernon 1997). The long-arm statute provides, inter alia, that a non-resident defendant is doing business in Texas within the meaning of the statute if it directly or through an intermediary "recruits" Texas residents for employment. Id. The Texas Supreme Court has consistently interpreted the statutory language "to reach as far as the federal constitutional requirements of due process will allow." CSR Ltd., 925 S.W.2d at 594 (quoting Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 226 (Tex. 1991)). Accordingly, the Texas long-arm statute requirements are satisfied if the exercise of personal jurisdiction comports with federal due process limitations. CSR Ltd., 925 S.W.2d at 594; see Guardian Royal, 815 S.W.2d at 226.

Compliance with the Texas long-arm statute and federal due process requires a plaintiff to show that the defendant has established "minimum contacts" with the forum state. International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154 (1945); Guardian Royal, 815 S.W.2d at 230; Schroeder v. Valdez, 941 S.W.2d 312, 314 (Tex. App.--Corpus Christi 1997, no writ). There must be a "substantial connection" between the nonresident defendant and Texas arising from action or conduct of the nonresident defendant purposefully directed toward Texas. Guardian Royal, 815 S.W.2d at 230; Schroeder, 941 S.W.2d at 314. A nonresident defendant who purposefully avails itself of the privileges and benefits of doing business in this state has sufficient contacts to confer personal jurisdiction. CSR Ltd., 925 S.W.2d at 594; see Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475-76, 105 S.Ct. 2174 (1985).

Minimum contacts may give rise to either specific or general jurisdiction. CSR Ltd., 925 S.W.2d at 594. General jurisdiction requires there to be continuous and systematic contacts between the nonresident defendant and Texas. CSR Ltd., 925 S.W.2d at 594; Guardian Royal, 815 S.W.2d at 228; Schroeder, 941 S.W.2d at 314. Such contacts permit Texas courts to exercise personal jurisdiction over a defendant even though the cause of action did not arise from or relate to activities conducted within the forum state. CSR Ltd., 925 S.W.2d at 594; see Schlobohm v. Schapiro, 784 S.W.2d 355, 357 (Tex. 1990). General jurisdiction requires a showing of "substantial" activities by the nonresident defendant in Texas, a more demanding minimum contacts analysis than for specific jurisdiction. CSR Ltd., 925 S.W.2d at 594; Guardian Royal, 815 S.W.2d at 228; Schroeder, 941 S.W.2d at 314.

Specific jurisdiction, on the other hand, is established where the defendant's alleged liability arises from or is related to an activity purposefully directed toward the forum state. Helicopteros, 466 U.S. at 417; CSR Ltd., 925 S.W.2d at 595; Schroeder, 941 S.W.2d at 314. When specific jurisdiction is asserted, the minimum contacts analysis focuses on the relationship between the defendant, the forum, and the litigation. Helicopteros, 466 U.S. at 414; Guardian Royal, 815 S.W.2d at 228.

Aside from "minimum contacts," due process also requires that the assertion of personal jurisdiction comport with traditional notions of fair play and substantial justice. Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102, 114, 107 S.Ct. 1026 (1987); Guardian Royal, 815 S.W.2d at 231; Juarez v. United Parcel Serv. de Mex. S.A. de C.V., 933 S.W.2d 281, 284 (Tex. App.--Corpus Christi 1996, no writ). The following factors, when appropriate, should be considered: (1) the burden on the defendant; (2) the interests of the forum state in adjudicating the dispute; (3) the plaintiff's interest in obtaining convenient and effective relief; (4) the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and (5) the shared interest of the several states in furthering fundamental substantive social policies. Asahi Metal, 480 U.S. at 115; Guardian Royal, 815 S.W.2d at 231; United Parcel Serv., 933 S.W.2d at 284.

Furthermore, when an international dispute is involved, this Court must also consider: (1) the unique burdens placed upon the defendant that must defend itself in a foreign legal system; and (2) the procedural and substantive policies of other nations whose interests are affected as well as the federal government's interest in its foreign relations policies. Asahi Metal, 480 U.S. at 115; Guardian Royal, 815 S.W.2d at 229; United Parcel Serv., 933 S.W.2d at 284.

On appeal from a special appearance, this Court reviews all the evidence in the record. J&J Marine, 982 S.W.2d at 924; Vosko v. Chase Manhattan Bank, N.A., 909 S.W.2d 95, 99 (Tex. App.--Houston [14th Dist.] 1995, writ denied); General Elec. Co. v. Brown & Ross Int'l, 804 S.W.2d 527, 529-30 (Tex. App.--Houston [1st Dist.] 1990, writ denied). To sustain a special appearance, the nonresident defendant must negate all bases of personal jurisdiction. CSR Ltd., 925 S.W.2d at 596.

Existence of personal jurisdiction is a question of law. However, the proper exercise of personal jurisdiction sometimes must be preceded by the resolution of underlying factual disputes. We review the appropriateness of the trial court's resolution of those facts under an ordinary sufficiency of the evidence standard. J&J Marine, 982 S.W.2d at 924; ContiCarriers, 944 S.W.2d at 411; Hotel Partners v. KPMG Peat Marwick, 847 S.W.2d 630, 632 (Tex. App.--Dallas 1993, writ denied). We will consider all the evidence that was before the trial court, including the pleadings, any stipulations, affidavits and exhibits, the results of discovery, and any oral testimony. J&J Marine, 982 S.W.2d at 924; ContiCarriers, 944 S.W.2d at 411; Vosko, 909 S.W.2d at 99.

While the trial court's findings of fact have the same force and dignity as a jury's verdict, see Taiwan Shrimp Farm Village Ass'n v. U.S.A. Shrimp Dev., Inc., 915 S.W.2d 61, 70 (Tex. App.--Corpus Christi 1996, writ denied), they are not conclusive when a complete reporter's record is presented on appeal. See Tucker v. Tucker,...