Cincinnati Art Galleries v. Fatzie, C-890726

• Decision Date: 19 December 1990
• Docket Number: No. C-890726,C-890726
• Citation: 591 N.E.2d 1336,70 Ohio App.3d 696
• Parties: CINCINNATI ART GALLERIES, Appellee, v. FATZIE et al., Appellants.
• Court: Ohio Court of Appeals

Page 696

70 Ohio App.3d 696

591 N.E.2d 1336

CINCINNATI ART GALLERIES, Appellee, v. FATZIE et al., Appellants.

No. C-890726.

Court of Appeals of Ohio, First District, Hamilton County.

Decided Dec. 19, 1990.

Bruce A. Hunter, Cincinnati, for appellee.

Katz, Teller, Brant & Hild and Jeffrey A. Tessel, Cincinnati, for appellants.

PER CURIAM.

The defendants-appellants, Donald F. Fatzie ("Fatzie") and Donzico Antiques and Imports ("Donzico"), appeal the trial court's judgment in favor of the plaintiff-appellee, Cincinnati Art Galleries. The decision of the trial court is affirmed as modified.

In May 1988, Fatzie noticed in a trade magazine an advertisement in which the plaintiff, an art gallery, sought to purchase the work of various artists. Fatzie telephoned the plaintiff and offered to sell it an original watercolor painting by F.S. Cozzens, one of the artists specified in the advertisement. The plaintiff was interested in the proposition and requested that Fatzie send photographs and photostatic copies of the painting. The plaintiff received the desired materials, and when it was unable to determine if the work at issue was a watercolor painting, Fatzie offered his personal assurance that the painting was indeed a watercolor.

The parties thereafter entered into an agreement, the terms of which required the plaintiff to pay $7,500 for the artwork. The parties also agreed that the plaintiff was to be afforded a one-day right of refusal so that it could inspect the artwork upon receipt and rescind the transaction if it was dissatisfied for any reason. Two weeks after the plaintiff forwarded the purchase price to Fatzie, it received the artwork. Upon examination, the plaintiff determined that the piece was not a watercolor but rather was an inexpensive print or copy. When the plaintiff's immediate attempts to contact Fatzie were unsuccessful, the plaintiff exercised its right of refusal and returned the print by overnight delivery to Fatzie's place of business. The receptionist, Barbara Davis, refused, however, to accept the delivery. Apparently, Fatzie had left town on vacation and had instructed Davis not to sign for any packages that were sent by the plaintiff. After a few days, the plaintiff was able to establish contact with Fatzie, who instructed the plaintiff to return the artwork. The delivery, however, was again refused and the parties were unable to resolve the dispute.

The plaintiff subsequently filed a complaint against the defendants in the Hamilton County Court of Common Pleas, asserting claims for breach of contract and fraud. The defendants' motion to dismiss for lack of personal jurisdiction was denied by the trial court. At the ensuing bench trial, the court found merit in the plaintiff's two claims and entered judgment in its favor. The defendants then filed this timely appeal.

In their first assignment of error, the defendants allege the trial court erred in overruling their motion to dismiss for lack of personal jurisdiction. Relaying on their status as residents of Maryland, they argue that their actions in dealing with the plaintiff did not constitute the "minimum contacts" necessary for an Ohio court to obtain in personam jurisdiction over them. This claim is without merit.

Personal jurisdiction over a nonresident defendant is governed by R.C. 2307.382, which states in pertinent part:

"(A) A court may exercise personal jurisdiction over a person who acts directly or by an agent, as to a cause of action arising from the person's:

"(1) Transacting any business in this state."

Similarly, Civ.R. 4.3(A)(1) authorizes out-of-state service of process on a defendant who is " * * * [t]ransacting any business in this state[.]"

The first task of this court is to determine whether R.C. 2307.382(A)(1) authorized the state of Ohio to assume jurisdiction over the instant defendants. In the case sub judice, Fatzie, by means of the mail and the telephone, engaged in preliminary negotiations with the plaintiff, an Ohio resident, concerning the artwork. The parties eventually entered into an agreement which allowed the plaintiff to purchase the artwork for $7,500. Fatzie cashed the plaintiff's check for that amount and then shipped the artwork to the agreed destination in Ohio. When problems arose concerning the authenticity of the artwork, the parties engaged in more discussions.

Based on the facts of this case and the settled proposition of Ohio law that R.C. 2307.382(A)(1) was intended to extend jurisdiction to the constitutional limits, Creech v. Oral Roberts (C.A. 6, 1990), 908 F.2d 75, we hold that the defendants transacted business in this state so as to render them subject to the jurisdiction of the Ohio courts. In arriving at this decision, we are mindful that the defendants maintained no physical presence in Ohio, but this fact alone does not preclude a determination that they transacted business in this state. Kentucky Oaks Mall Co. v. Mitchell's Formal Wear, Inc. (1990), 53 Ohio St.3d 73, 559 N.E.2d 477.

Having determined that Fatzie's conduct falls within the purview of R.C. 2307.382(A)(1) and Civ.R. 4.3(A)(1), we must next decide whether the assertion of personal jurisdiction by an Ohio court over the defendants comports with the Due Process Clause of the Fourteenth Amendment. "[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that maintenance of the suit does not offend 'traditional notions of fair-play and substantial justice.' " International Shoe Co. v. Washington (1945), 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95, 102.

In deciding whether a single act or transaction of a defendant is within the due process limits of a "long-arm" statute, the court in Southern Machine Co. v. Mohasco Industries, Inc. (C.A. 6, 1968), 401 F.2d 374, 381, set forth a three-part analysis. In accordance with this approach, the following criteria are to be considered:

"First, the defendant must purposefully avail himself of the privilege of acting in the forum state or causing a consequence in the forum state. Second, the cause of action must arise from the defendant's activities there. Finally, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant reasonable."

With regard to the first criterion, the record indicates that Fatzie telephoned the plaintiff and offered to sell it a watercolor painting; that the parties contracted for the sale of the artwork; that the artwork was not a "watercolor" painting but was...