Circus Circus Hotels, Inc. v. Superior Court of Orange County

• Decision Date: 14 April 1981
• Citation: 173 Cal.Rptr. 115,118 Cal.App.3d 53
• Court: California Court of Appeals Court of Appeals
• Parties: CIRCUS CIRCUS HOTELS, INC., Petitioner, v. The SUPERIOR COURT OF ORANGE COUNTY, Respondent. James B. HAYNIE, Jr. et al., Real Parties in Interest. Civ. 25386.

Page 115

173 Cal.Rptr. 115

118 Cal.App.3d 53

CIRCUS CIRCUS HOTELS, INC., Petitioner, v. The SUPERIOR COURT OF ORANGE COUNTY, Respondent James B. HAYNIE, Jr. et al., Real Parties in Interest.

Civ. 25386.

Court of Appeal, Fourth District, Division 2, California.

April 14, 1981.

Roper & Folino and Michael J. Irwin, Los Angeles, for petitioner.

No appearance for respondent.

R. M. Cantillon, Newport Beach, for Real Parties in Interest.

OPINION

McDANIEL, Associate Justice.

The plaintiffs, a husband and wife and their 21-year old son, all residents of Orange County, California, along with two other sons, minors, took a recreational trip to Nevada in the early winter of 1980. After visiting the Mt. Charleston ski area, the family "by majority vote" decided to spend a night in Las Vegas. The parents in turn decided that the Circus Circus Hotel would be a good place to stay because "two of our three sons were underage and (that hotel) offered attractions and games for minors..."

The family did stay at the Circus Circus Hotel and during the first night there their room was burglarized. As a result, the plaintiffs claimed to have lost cash and personal property, including jewelry and a mink coat, of an aggregate value of $7,100.

After returning to Orange County, the plaintiffs filed suit there against the hotel, alleging negligence of the hotel as the reason for the theft or mysterious disappearance of their property. The complaint sought recovery of the $7,100 noted plus $10,000 in exemplary damages. Yet otherwise plaintiffs alleged "because of the matter complained of herein, and the anguish visited the plaintiffs and because of the losses they sustained, plaintiffs cut short their excursion at a cost to plaintiffs Jas. B. and Henrietta Haynie of at least $1,500, all to these plaintiffs' additional damages in this sum ($1,500 total)."

After the complaint was filed, the defendant Circus Circus Hotels, Inc., appeared specially for the purpose of moving to quash service of summons upon it. Such motion was based both upon a lack of in personam jurisdiction and an inconvenient forum. The trial court denied the motion, and defendant petitioned us for a writ of mandate to redress the claimed error of the trial court in denying the motion. We issued the alternative writ, and the case is now before us for disposition.

SUMMARY OF FILINGS IN SUPPORT OF THE MOTION

In support of its motion, the defendant filed the affidavit of Carl E. Lovell, Jr., ¹ the secretary-treasurer of the defendant corporation. According to Lovell's affidavit, defendant Circus Circus Hotels, Inc., is a Nevada corporation with its principal place of business in Las Vegas. Its business is the operation of hotels and casinos in Las Vegas and Reno, Nevada, and it does not own or operate any hotels or casinos in California or in any other state besides Nevada.

Further, according to the Lovell affidavit, the defendant has never filed its articles of incorporation with the Secretary of State of the State of California; neither has it designated any person residing in California upon whom process may be served. Likewise, it never has filed with the Secretary of State of the State of California its irrevocable consent to such service or to service of process upon it by the Secretary of State.

The Lovell affidavit further shows that the alleged tortious conduct complained of by the plaintiffs occurred at 2880 Las Vegas Boulevard South, Las Vegas, Nevada. It also shows that defendant, at the time of the incidents referred to in the complaint, did not own any real or personal property in California, nor did it lease or maintain any office, residence or place of business in California. It likewise has no agents in California.

From the Lovell affidavit it also appears that the defendant at no time ever had any bank accounts in California; neither did it ever own stock of any kind in California. He also stated that it has never paid any income taxes or any real property taxes in the State of California. The affidavit concluded with the statement that defendant has never conducted any business in California.

SUMMARY OF FILINGS IN OPPOSITION TO THE MOTION

In opposition to the motion, the plaintiffs filed the declaration of plaintiff Jas. B. Haynie, Jr., a Californian by birth and by his own assertion a "natural US citizen."

The declaration contains much interesting detail about the Haynies' trip to Las Vegas, ² about its unfortunate consequences and about why they concluded that it was the defendant's fault that their room was burglarized. It also explains that his "present atty. has been my attorney and my family's atty. for about 15 years and we definitely do not want to go to the trouble of locating and hiring a Las Vegas attorney and paying more attorney's fees, court costs and sheriff expenses. In fact, neither I nor Mrs. Haynie know a Las Vegas or Nevada attorney and our own lawyer tells me that the only one he knew died about 2 or 3 years ago (John McNamee)." The declaration concludes in righteous indignation by stating that "(d)uring my stay at this hotel or upon checking out I paid $103.05 (three nights) for the room but under protest, also with money I had earned in California."

With reference to factual circumstances arguably relevant to the constitutional question of the trial court's in personam jurisdiction, the declaration points to the extensive advertising done by the defendant in the Los Angeles Times. Copies of a representative sampling of such advertisements are attached as exhibits to the declaration. Mr. Haynie also declares, "my lawyer tells me that defendant has admitted advertising in California and maintaining an 800 telephone $ available at no charge to California residents."

After referring to particular kinds of ads which appeared in the Los Angeles Times on specific dates, the declaration states, "On 11/24/80 ³ I placed a telephone call to Phyllis Shannon of (the) L.A. Times, Orange County office, 957-2000. I was informed that a like ad printed in the funnies would cost $2,332 per Sunday and the square ad, $816.20. The ads appearing in the funnies are in color (black, white, blue, yellow and red.)" ⁴

DISCUSSION

The law to be applied in resolving the issue of jurisdiction over defendant is governed by statute in California. Section 410.10 of the Code of Civil Procedure states: "A court of this state may exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of the United States." As a consequence, any effort by a California court to exercise in personam jurisdiction over a non-resident, as here, is a matter controlled by the due process clause of the Fourteenth Amendment to the United States Constitution.

A recent California Supreme Court pronouncement which interprets the scope of this statutory authority is found in Sibley v. Superior Court, 16 Cal.3d 442, 128 Cal.Rptr. 34, 546 P.2d 322. There Justice Richardson said, "Under Code of Civil Procedure section 410.10, a California court may exercise jurisdiction over nonresidents on any basis not inconsistent with the United States or California Constitutions. This section manifests an intent to exercise the broadest possible jurisdiction, limited only by constitutional considerations. (Citations.) As a general constitutional principle, a court may exercise personal jurisdiction over a nonresident individual so long as he has such minimal contacts with the state that ' the maintenance of the suit does not offend "traditional notions of fair play and substantial justice. " ' (Citations.) (P) One of the recognized bases for jurisdiction in California arises when the defendant has caused an 'effect' in the state by an act or omission which occurs elsewhere. (Citations.) This ground for assertion of jurisdiction is discussed by the Judicial Council in its comment to section 410.10 of the Code of Civil Procedure reprinted in West's Annotated California Codes, page 472, in the following language: 'A state has power to exercise judicial jurisdiction over an individual who causes effects in the state by an omission or act done elsewhere with respect to causes of action arising from these effects, unless the nature of the effects and of the individual's relationship to the state make the exercise of such jurisdiction unreasonable. (Citations.) When jurisdiction over an individual is based solely upon such act or omission, only a claim for relief arising from such act or omission may be asserted against the individual. (Citation.)' (Italics added.)" (Id. at pp. 445-446, 128 Cal.Rptr. 34, 546 P.2d 322.)

Sibley followed by one month the California Supreme Court case of Cornelison v. Chaney, 16 Cal.3d 143, 127 Cal.Rptr. 352, 545 P.2d 264, on the same subject. The recent case of Lundgren v. Superior Court, 111 Cal.App.3d 477, 168 Cal.Rptr. 717, relied upon Cornelison in issuing a peremptory writ of mandate directing the trial court to vacate its order denying a motion to quash service of summons. In Lundgren, Justice Files quotes Cornelison as the law to be applied in such cases as follows, " ' The general rule is that the forum state may not exercise jurisdiction over a nonresident unless his relationship to the state is such as to make the exercise of such jurisdiction reasonable. (Citations.)

" 'If a nonresident defendant's activities may be described as " extensive or wide-ranging" (citation) or "substantial continuous and systematic" (citation), there is a constitutionally sufficient relationship to warrant jurisdiction for all causes of action asserted against him. In such circumstances, it is not necessary that the specific cause of action alleged be connected with the defendant's business relationship to the forum.

" 'If, however, the defendant's activities in the forum are not so pervasive as to justify the exercise of general jurisdiction over him, then jurisdiction depends upon the quality and nature of his activity in the forum...