Deuser v. Spain
| Decision Date | 05 April 2023 |
| Docket Number | 05-22-01206-CV |
| Parties | BLAKE DEUSER AND OLD OAKS OUTFITTER, LLC, Appellants v. ROSS SPAIN, Appellee |
| Court | Texas Court of Appeals |
On Appeal from the 192nd Judicial District Court Dallas County Texas Trial Court Cause No. DC-22-03417
Before Justices Carlyle, Goldstein, and Kennedy
In this accelerated appeal, Blake Deuser and Old Oaks Outfitter, LLC ("Old Oaks") appeal the trial court's order denying their special appearance. In two issues, appellants argue the trial court erred by concluding they are subject to personal jurisdiction in Texas. We reverse the trial court's order and render judgment granting the special appearance and dismissing appellee Ross Spain's claims against Deuser and Old Oaks. Because all issues are settled in law, we issue this memorandum opinion. Tex.R.App.P. 47.4.
Deuser is an individual resident of the State of Indiana and the sole member of Old Oaks a limited liability company formed in Indiana, which contracts with individuals to hunt animals in Indiana. Appellants and Spain entered into a contract whereby Spain agreed to provide marketing services and social media assistance to Old Oaks in exchange for a monthly fee, as well as a percentage of commissions from hunts sold through Spain's services.
On March 29, 2022, Spain filed suit against Deuser and Old Oaks asserting they had breached the contract by failing to fully compensate him for the services he provided.[1] With respect to personal jurisdiction, Spain alleged that Old Oaks was doing business in Texas and that the contract at issue was with him, a Texas resident, and was to be performed in whole or in part in Texas. In July, appellants filed their special appearance, asserting they were nonresidents who had not performed any business in Texas and other arguments to contest the trial court's exercise of jurisdiction over them. Soon thereafter, Spain filed an amended petition and a response to appellants' special appearance, still asserting that because appellants entered into a contract with him, a Texas resident, to perform services in Texas, the trial court has personal jurisdiction over them. Spain attached to the response his declaration and a copy of the contract at issue. Appellants filed an amended special appearance to which they attached Deuser's declaration. After conducting a hearing, the trial court denied the special appearance.[2] This accelerated appeal followed.
Whether a trial court has personal jurisdiction over a nonresident defendant is a question of law that appellate courts review de novo. See Steward Health Care Sys. LLC v. Saidara, 633 S.W.3d 120, 125 (Tex. App.-Dallas 2021, no pet.) (en banc) (citing Old Republic Nat'l Title Ins. Co. v. Bell, 549 S.W.3d 550, 558 (Tex. 2018)). When a trial court does not issue findings of fact and conclusions of law with its special appearance ruling, all facts necessary to support the judgment and supported by the evidence are implied. Id. When the appellate record includes the reporter's and clerk's records, these implied findings are not conclusive and may be challenged for legal and factual sufficiency in the appropriate appellate court. Id. at 125-26. (citing BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 795 (Tex. 2002)). When the relevant facts in a case are undisputed, an appellate court need not consider any implied findings of fact and considers only the legal question of whether the undisputed facts establish Texas jurisdiction. See id. at 126 (citing Old Republic, 549 S.W.3d at 558).
Courts have recognized two types of personal jurisdiction: "general" jurisdiction and "specific" jurisdiction. See Bristol-Myers Squibb Co. v. Superior Ct. of Cal., 582 U.S. 255, 262 (2017). For an individual, the paradigm forum for the exercise of general jurisdiction is the individual's domicile; for a corporation, it is an equivalent place, one in which the corporation is fairly regarded as at home. See id. A court with general jurisdiction may hear any claim against that defendant, even if all the incidents underlying the claim occurred in a different State. See id. But "only a limited set of affiliations with a forum will render a defendant amenable to" general jurisdiction in that State. See id.
Here, the court did not specify which type of jurisdiction it found. In neither his first amended petition, his response to the special appearance, nor his brief on appeal does Spain contest that the appellants are nonresidents. And, appellants provided evidence to support that assertion. Accordingly, we will limit our examination to whether the trial court erred by impliedly finding it had specific jurisdiction over appellants.
The plaintiff bears the initial burden of pleading sufficient allegations to bring a nonresident defendant within the provisions of the Texas long-arm statute. Saidara, 633 S.W.3d at 126 (citing Old Republic, 549 S.W.3d at 559; Moncrief Oil Int'l, Inc. v. OAO Gazprom, 414 S.W.3d 142, 149 (Tex. 2013)). In order to meet its burden, a plaintiff must show the act on which jurisdiction is predicated, not a prima facie demonstration of the existence of a cause of action. Bruno's Inc. v. Arty Imports, Inc., 119 S.W.3d 893, 896-97 (Tex. App.-Dallas 2003, no pet.); Clark v. Noyes, 871 S.W.2d 508, 511 (Tex. App.-Dallas 1994, no pet.)). This minimal pleading requirement is satisfied by an allegation that the nonresident defendant is doing business in Texas or committed tortious acts in Texas. See id. (). If the plaintiff does not meet this burden, the defendant need only prove that it does not reside in Texas to negate jurisdiction. See Siskind v. Villa Found. for Educ., Inc., 642 S.W.2d 434, 438 (Tex. 1982); Jani-King Franchising, Inc. v. Falco Franchising, S.A., No. 05-15-00335-CV, 2016 WL 2609314, at *4, (Tex. App.-Dallas May 5, 2016, no pet.) (mem. op.)).
Specific jurisdiction exists when (1) the defendant has "made minimum contacts with Texas by purposefully availing itself of the privilege of conducting activities [in the state]," and (2) the defendant's potential liability arose from or is related to those contacts. In re Christianson Air Conditioning & Plumbing, LLC, 639 S.W.3d 671, 679 (Tex. 2022) (orig. proceeding) (quoting Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 576 (Tex. 2007)). To show purposeful availment, a plaintiff must prove that a nonresident defendant seeks a benefit, advantage, or profit from the forum market. Michiana Easy Livin' Country, Inc. v. Holten, 168 S.W.3d 777, 785 (Tex. 2005)). Only the defendant's contacts are relevant, not the unilateral activity of another party or third person. See id. And those contacts "must be purposeful rather than random, fortuitous, or attenuated." Moncrief Oil, 414 S.W.3d at 151, and quoting Retamco Operating, Inc. v. Republic Drilling Co., 278 S.W.3d 333, 338-39 (Tex. 2009)).
In two issues, appellants argue the trial court erred by denying their special appearance. They urge that the facts alleged by Spain are insufficient to establish they are subject to personal jurisdiction and that the exercise of jurisdiction over them offends traditional notions of fair play and substantial justice.
A plaintiff's petition satisfies the long-arm statute when it alleges the defendant did business, which includes "contracts by mail or otherwise with a Texas resident and either party is to perform the contract in whole or in part" in Texas. See Tex. Civ. Prac. & Rem. Code § 17.042(1); see also Saidara, 633 S.W.3d at 129. In this case, in his petition, Spain alleged Old Oaks is a limited liability company doing business in Texas and that both appellants contracted with Spain, a Texas resident, ". . . to perform the contract in whole or in part in Texas." These allegations are sufficient to meet Spain's initial pleading burden. See Moki Mac, 221 S.W.3d at 574. Thus, to the extent appellants' first issue challenges the sufficiency of Spain's pleading, we overrule it.
The burden shifted to appellants to negate all bases of personal jurisdiction alleged by Spain. See Old Republic, 549 S.W.3d at 559. One way appellants could meet this burden is by showing that "even if the plaintiff's alleged facts are true, the evidence is legally insufficient to establish jurisdiction" or that "[appellants'] contacts with Texas fall short of purposeful availment." See id. (quoting Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653, 659 (Tex. 2010)).
In his declaration, Deuser offered statements regarding his and Old Oaks' respective contacts with Texas. Because their respective contacts differ, we will address each appellant's contacts in turn.
A. Deuser
In his declaration, Deuser stated that, relative to the contract at issue, he acted "solely as an authorized agent of Old Oaks and not in any individual capacity." Additionally the contract Spain included as an exhibit to his declaration includes his and Deuser's signatures, with Deuser identified as "Blake Deuser, Owner/Partner" of Old Oaks. If a person signs a contract in his corporate capacity, he is not individually a party to the contract. See Wolf v. Summers-Wood, L.P., 214 S.W.3d 783, 792 (Tex. App.-Dallas 2007, no pet.) ; ...
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