Chrysler Corp. v. Traveleze Industries, Inc.

• Decision Date: 01 December 1981
• Docket Number: Civ. A. No. 81-72537.
• Citation: 527 F. Supp. 246
• Parties: CHRYSLER CORPORATION, a Delaware Corporation, Plaintiff, v. TRAVELEZE INDUSTRIES, INC., a California Corporation, Defendant.
• Court: U.S. District Court — Western District of Michigan

527 F. Supp. 246

CHRYSLER CORPORATION, a Delaware Corporation, Plaintiff, v. TRAVELEZE INDUSTRIES, INC., a California Corporation, Defendant.

Civ. A. No. 81-72537.

United States District Court, E. D. Michigan, S. D.

December 1, 1981.

Steven B. Hantler, Paul R. Eichbauer, Detroit, Mich., for plaintiff.

Gregory M. Kopacz, Laurence D. Connor, Detroit, Mich., for defendant.

OPINION DENYING DEFENDANT'S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION

FEIKENS, Chief Judge.

Plaintiff Chrysler Corporation ("Chrysler"), an automobile manufacturing company, has brought suit against Traveleze Industries, Inc. ("Traveleze"), a recreational vehicle manufacturer. In its complaint, Chrysler alleges that Traveleze breached its contract with Chrysler for the supply of chassis for the recreational vehicles by failing to pay for certain chassis that were supplied to it pursuant to a deferred payment plan as provided for in the contract. Defendant moves to dismiss the case for lack of personal jurisdiction over it.

In diversity cases, Michigan law governs the in personam jurisdiction of the United States District Court sitting in Michigan. Erie R.R. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Plaintiff does not seriously contend that there is general personal jurisdiction over defendant pursuant to M.C.L.A. 600.711. However, to exercise limited personal jurisdiction in Michigan over defendant, one of the following relationships must exist between Traveleze and the State: the transaction of any business within Michigan; the doing or causing any act to be done, or consequence to occur in Michigan resulting in an action for tort; the ownership, use, or possession of any real or tangible personal property situated within Michigan; contracting for insurance of any person, property, or risk located in Michigan at the time of contracting; or entering into a contract for services to be performed or for materials to be furnished in Michigan by defendant. M.C.L.A. 600.715. It is clear from the allegations in the complaint that there are no tortious actions brought against defendant, nor does the complaint concern any insurance agreement. Hence the facts must be analyzed in view of the remaining three grounds for asserting personal jurisdiction.

It is uncontroverted that Traveleze has its principal place of business in California, that it has never maintained any office or facility in Michigan, nor has it ever been registered to do business in Michigan. Neither is it disputed that it has never sent an agent to solicit business in Michigan. It is settled that Traveleze contracted to purchase chassis from Chrysler through the contract that is the subject of this lawsuit.

According to the affidavits that are presented in regard to this motion, the president of Traveleze, Kenneth Dixon, Jr., attended a promotional meeting for the Chrysler chassis sales program. Thereafter, Dixon was contacted by a Chrysler representative from the Fullerton, California office, who requested that Dixon sign the contract in question if he desired to purchase recreational vehicle chassis from Chrysler. Dixon signed the agreement but the Chrysler agent did not execute it for the corporation at the same time. Instead, the contract was sent to Michigan, where Frank W. Knope, manager of Dealer Credit at Chrysler, signed on behalf of plaintiff and the completed contract was forwarded to Traveleze through the California office of Chrysler. Orders for the chassis were placed to the Fullerton office by Traveleze, from which they were forwarded to Chrysler headquarters in Michigan. There is a dispute as to whether these orders were forwarded at Traveleze's request or on Chrysler's own initiative, but the distinction for the purpose of determining jurisdiction is, in this case, insignificant. However, it is useful to note that the contract provides that purchase orders are subject to acceptance by Chrysler. Upon acceptance, the chassis may be paid for in one of three ways: by cash, by deferred payment, or by demonstrator chassis payment. Under the deferred payment plan, selected by Traveleze in this instance, payment was due to Chrysler on the date that Traveleze shipped the completed recreational vehicle to its distributor. Thereafter, Chrysler would draw a cash draft on Traveleze's bank in California unless Traveleze was given an extension by Chrysler with provisions also made for late payments. Title passed to Traveleze upon delivery of the chassis to the carrier or Traveleze, whichever occurred first, although Chrysler retained a lien on the chassis until full payment had been made. Other paragraphs provided for inspection and pre-delivery service, repurchase of the chassis by Chrysler under limited circumstances, warranty, and the termination of the agreement. Although several paragraphs specified that it was necessary to notify Chrysler in certain instances, no address apart from the Highland Park, Michigan address was given except the office to which financial statements were to be mailed.

It is admitted by both parties to this lawsuit that no negotiations took place in Michigan prior to the execution of the contract. Thereafter, several payments were made to a Michigan office of Chrysler, several telephone calls were placed between Chrysler offices in Michigan and Traveleze, and financial statements were furnished to a Michigan office as provided for by the terms of the contract. It is disputed that the payments that were made directly to Chrysler were made voluntarily or at Chrysler's request, but again I find that this issue need not be resolved for the purposes of this motion. Chrysler contends that the following acts constitute sufficient contacts to confer jurisdiction: execution of the contract by Chrysler in Michigan; performance of the contract by manufacturing the chassis in Michigan; mailing of payments and balance sheets by Traveleze to Chrysler in Michigan; and the ownership of personal property in Michigan since title passed on delivery of the chassis to the carrier.

Traveleze denies that any of these actions are sufficient for jurisdictional purposes. It states that although it signed an unexecuted copy of the contract, it did not know where it would be signed by Chrysler. Similarly, it argues that although it did not specifically contract for the chassis to be manufactured at a given locale, they could have been made at any Chrysler plant and thus subjected Traveleze to the risk of suit in any jurisdiction where Chrysler would manufacture them. The balance sheets were mailed according to the contract provisions and, although Traveleze does not specifically so state, it presumed that this was a matter of convenience, and differed from the remaining provisions that it allegedly presumed were administered through the Fullerton office. Finally, it contends that the title provisions merely transferred the risk of loss of the chassis and were never intended to convey ownership. It analyzes the jurisdiction requirement of ownership by arguing that mere ownership of chattel in a state would subject Traveleze to suit in every state through which the carrier passed between Michigan and California.

Viewed individually, Traveleze's claims could raise sufficient question about my jurisdiction in this case. However, in personam jurisdiction is not to be determined by any rigid guidelines but should be evaluated on a case...