C.J. Betters Corp. v. Mid South Aviation Services, Inc.

• Decision Date: 20 August 1991
• Citation: 407 Pa.Super. 511,595 A.2d 1264
• Parties: C.J. BETTERS CORPORATION, Appellant, v. MID SOUTH AVIATION SERVICES, INC., d/b/a Lakeland Air Center and R.E. Shackelford, Appellees. (Two Cases)
• Court: Pennsylvania Superior Court

Page 1264

595 A.2d 1264

407 Pa.Super. 511

C.J. BETTERS CORPORATION, Appellant, v. MID SOUTH AVIATION SERVICES, INC., d/b/a Lakeland Air Center and R.E. Shackelford, Appellees. (Two Cases)

Superior Court of Pennsylvania.

Argued Jan. 9, 1991.

Filed Aug. 20, 1991.

Joseph T. Moran, Pittsburgh, for appellant.

Mark F. Haak, Pittsburgh, for Mid South, appellee (at 818) and for Shackelford, appellee (at 1679).

Before TAMILIA, POPOVICH and JOHNSON, JJ.

POPOVICH, Judge:

These consolidated appeals are from the orders of the Court of Common Pleas of Beaver County which dismissed the assumpsit complaint against appellees, Mid-South Aviation Services and R.E. Shackelford, for want of in personam jurisdiction. We reverse and remand for trial.

The record reveals that appellant, C.J. Betters Corporation, is a Pennsylvania Corporation with its principal place of business in Aliquippa, Beaver County, Pennsylvania. Mid-South is a Florida corporation with its principal place of business in Lakeland, Florida. Mid-South is in the business of selling aviation fuel, performing maintenance on aircraft and brokering aircraft. R.E. Shackelford is a resident of North Carolina ¹ and original owner of the 1972 Cessna Citation airplane in question.

In 1988, Betters initially contacted Mid-South concerning a turbine driven propeller aircraft in response to one of Mid-South's advertisements. Mid-South places advertisements similar to newspaper "want-ads", in three separate national and international aviation trade journals to facilitate its brokerage business. After discussions with Mid-South, Betters determined a jet, rather than a propeller driven plane, would better suit its needs. Mid-South then located the Cessna Citation owned by R.E. Shackelford and informed Betters. The Cessna Citation was then flown to Mid-South's headquarters in Lakeland, Florida.

Representatives from Betters then travelled to Mid-South's headquarters to inspect the aircraft. The parties discussed various repairs and alterations which were to be performed prior to Betters' purchase of the aircraft. All of the "face-to-face" negotiations took place in Florida, and additional negotiations took place via letter and telephone correspondence between the parties' Florida and Pennsylvania headquarters.

On or about January 24, 1989, Mid-South's Chairman of the Board, Thomas S. Petcoff, executed the subject contract for the sale of the plane at Mid-South's Florida location. The contract was then sent to Aliquippa, Pennsylvania where it was executed by C.J. Betters, President of C.J. Betters Corporation. No Mid-South representatives travelled to Pennsylvania prior to delivery of the aircraft.

The sales contract provided Betters would pay Mid-South $440,000.00, for the aircraft, which included $55,000.00, for repairs and alterations to be made prior to delivery. The agreement specifically provided that Mid-South was to deliver the aircraft to the Beaver County, Pennsylvania, Airport, where final inspection was to be performed by Betters prior to acceptance. Over the next several months after execution of the sales agreement, Mid-South and Betters were in close contact via telephone and written communications, regarding completion of the repairs and alterations required by the contract. On or about April 5, 1989, Betters accepted delivery of the Cessna Citation at the Beaver County Airport. Simultaneously, Betters directed the escrow agent to release the balance of the funds due to R.E. Shackelford.

Subsequently, on April 13, 1989, the aircraft's right engine malfunctioned during flight necessitating an emergency landing in Lancaster, Pennsylvania. Mid-South was immediately notified of the problem. However, the parties were unable to negotiate an amicable settlement, and Betters filed suit against Mid-South and R.E. Shackelford in the Court of Common Pleas of Beaver County seeking damages for the cost of repairs and loss of use in the total amount of $181,740.50.

Mid-South and Shackelford filed preliminary objections alleging lack of in personam jurisdiction in Pennsylvania. The lower court relying on Dommel's Hotel, Inc. v. East-West Helicopter, Inc., 580 F.Supp. 15 (E.D.Pa.1984), agreed and dismissed the cases against Mid-South and Shackelford for want of jurisdiction. This appeal by Betters followed.

"[W]hen preliminary objections, if sustained, would result in the dismissal of an action, such objections should be sustained only in cases which are clear and free from doubt." Barber v. Pittsburgh Corning Corp., 317 Pa.Super. 285, 302-03, 464 A.2d 323, 332 (1983), cert. denied 467 U.S. 1205, 104 S.Ct. 2387, 81 L.Ed.2d 346 (1984), citing Botwinck v. Credit Exchange, Inc., 419 Pa. 65, 213 A.2d 349 (1965). "Moreover, when deciding a motion to dismiss for lack of personal jurisdiction the court must consider the evidence in the light most favorable to the non-moving party." Barber v. Pittsburgh Corning Corp., supra. ...

A court may exercise in personam jurisdiction over a nonresident if (1) jurisdiction is conferred by the state long-arm statute and (2) the exercise of jurisdiction under the statute meets constitutional standards of due process. Eastern Continuous Forms v. Island Business Forms, 355 Pa.Super. 352, 513 A.2d 466 (1986). Under Pennsylvania's long-arm statute, the Pennsylvania court may exercise jurisdiction over nonresident defendants "to the fullest extent allowed under the Constitution of the United States" and jurisdiction may be based "on the most minimum contact with this Commonwealth allowed under the Constitution of the United States." 42 Pa.C.S.A. § 5322(b). See Skinner v. Flymo, 351 Pa.Super. 234, 240, 505 A.2d 616, 619 (1986).

"The Due Process Clause of the Fourteenth Amendment to the United States Constitution permits personal jurisdiction over a defendant in any State with which the defendant has 'certain minimum contacts ... such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.' Milliken v. Meyer, 311 U.S. 457, 463, [61 S.Ct. 339, 342, 85 L.Ed. 278 (1940) ].' " Eastern Continuous Business Forms, supra, 355 Pa.Super. at 354-55, 513 A.2d at 467, quoting Calder v. Jones, 465 U.S. 783, 787, 104 S.Ct. 1482, 1486, 79 L.Ed.2d 804, 810 (1984). In minimum contacts analysis, "talismanic jurisdictional formulas" are rejected and the facts of a each case are weighed in determining whether personal jurisdiction will comport with fair play and substantial justice. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 485-86, 105 S.Ct. 2174, 2189, 85 L.Ed.2d 528, 549 (1985), quoting Kulko v. California Superior Court, 436 U.S. 84, 92, 98 S.Ct. 1690, 1696-97, 56 L.Ed.2d 132, 141 (1978), reh'g denied 438 U.S. 908, 98 S.Ct. 3127, 57 L.Ed.2d 1150 (1978)....

While an individual's contract with an out-of-state party cannot alone establish sufficient contacts with the forum state, negotiations prior to the contract, its contemplated future consequences, the terms of the contract and the parties' actual course of dealing must be evaluated in determining whether the defendant "purposely avail[ed] itself of the privilege of conducting activities within the forum State." Burger King Corp. v. Rudzewicz, supra, 471 U.S. at 474-75, 105 S.Ct. at 2183, 85 L.Ed.2d at 542 & 545, quoting Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1240, 2 L.Ed.2d 1283 (1958).... ²

Once it has been determined that the defendant has purposely established minimum contacts with the forum state, those contacts may be considered in light of other factors to determine whether the exercise of personal jurisdiction will comport with fair play and substantial justice. Burger King v. Rudzewicz, supra, 471 U.S. at 476-77, 105 S.Ct. at 2184, 85 L.Ed.2d at 612. Those factors include the burden on the defendant, the forum state's interest in adjudicating the dispute, the plaintiff's interest in obtaining convenient and effective relief, the interstate judicial system's interest in obtaining the most efficient resolution of controversies, and the shared interest of the "several States in furthering fundamental substantive social policies." Id.

Kenneth H. Oaks, Ltd. v. Josephson, 390 Pa.Super. 103, 104-08, 568 A.2d 215, 216-217 (1989). See also United Farm Bur. Mut. Ins. v. U.S. Fid. & Guar., 501 Pa. 646, 654-59, 462 A.2d 1300, 1304-1306 (1983); Skinner v. Flymo, Inc., 505 A.2d at 619-621. ³ Keeping the aforementioned principles in mind, we now address the question of whether, viewing the evidence in a light most favorable to Betters, the non-moving party, the lower court erred in dismissing Mid-South and Shackelford for lack of personal jurisdiction in Pennsylvania. We find that the lower court erred in dismissing the actions against Mid-South and R.E. Shackelford. Initially, we note that it is undisputed that jurisdiction is conferred by the Pennsylvania long-arm statute, 42 Pa.C.S.A. § 5322(a)(1) and (3). Consequently, we need only address the question of whether the exercise of jurisdiction comports with the standards of due process. Kenneth H. Oaks, Ltd., 568 A.2d at 216.

Undoubtedly, an out-of-state party's contract with a forum resident alone is insufficient to establish minimum contacts necessary to satisfy the mandates of due process. Burger King v. Rudzewicz, 471 U.S. at 478, 105 S.Ct. at 2185. ⁴ However, presently, the contract for the sale of the airplane itself was not the only "contact" with Pennsylvania. Moreover, even a single act can support jurisdiction, so long as it creates a "substantial connection" with the forum, provided the nature, quality and circumstances of the act's commission create more than a mere attenuated affiliation with the forum. Burger King v. Rudzewicz, 471 U.S. at 475 n. 18, 105 S.Ct. at 2184 n. 18, citing McGee v. International Life Ins Co.,355 U.S. 220 at 223, 78 S.Ct. 199 at 201, 2 L.Ed.2d 223 (1957), International Shoe Co. v. State of Washington, 326 U.S. 310 at 318, 66 S.Ct. 154 at...