Droukas v. Divers Training Academy, Inc.

• Decision Date: 04 May 1978
• Citation: 375 Mass. 149,24 U.C.C. Rep Serv 118,376 N.E.2d 548
• Parties: , 24 UCC Rep.Serv. 118 Peter DROUKAS, Jr. v. DIVERS TRAINING ACADEMY, INC.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 548

376 N.E.2d 548

375 Mass. 149, 24 UCC Rep.Serv. 118

Peter DROUKAS, Jr. v. DIVERS TRAINING ACADEMY, INC.

Supreme Judicial Court of Massachusetts,Plymouth.

Argued Dec. 5, 1977.

Decided May 4, 1978.

John F. Finnerty, Jr., Boston, for plaintiff.

Thomas F. Quinn, Boston, for defendant.

Before HENNESSEY, C. J., and QUIRICO, BRAUCHER, WILKINS and LIACOS, JJ.

QUIRICO, Justice.

The plaintiff appeals from a judgment entered following the allowance of the defendant's motion, under Mass.R.Civ.P. 12(b)(2), 365 Mass. 754 (1974), to dismiss the action for lack of personal jurisdiction. The plaintiff challenges the order of a judge of the Superior Court allowing the motion, arguing that G.L. c. 223A, §§ 3(a ) and (b ) (the long arm statute), conferred personal jurisdiction over the defendant. ¹ We disagree with this contention and affirm the judgment.

The procedural background of the case is as follows. On March 19, 1976, the plaintiff, a resident of Massachusetts, commenced an action under G.L. c. 93A, inserted by St.1967, c. 813, § 1, against the defendant, a Florida corporation. The complaint sought recovery for an alleged breach of warranty by the defendant in the sale of two marine engines which the plaintiff contends were defective by reason of salt water damage. The plaintiff sought treble damages, attorneys' fees, and any other relief deemed appropriate by the court. Service of process was made on the defendant in Florida by certified mail, return receipt requested, in accordance with G.L. c. 223A, § 6(a )(3).

The defendant filed a motion to dismiss the action for lack of "personal jurisdiction" over it within the meaning of the statute. The motion was supported by an affidavit of the defendant's president alleging facts bearing on the issue of jurisdiction. The plaintiff submitted an affidavit controverting in certain respects the defendant's affidavit and alleging facts in support of jurisdiction. After a hearing the judge allowed the motion and judgment was entered dismissing the action. The plaintiff appealed therefrom to the Appeals Court, and we ordered direct appellate review.

Confronted with a motion under Mass.R.Civ.P. 12(b)(2), 365 Mass. 754 (1974), a plaintiff "has the burden of establishing the facts upon which the question of personal jurisdiction over a defendant is to be determined." Nichols Assocs. v. Starr, --- Mass.App.Ct. ---, ---, ^a 341 N.E.2d 909 (1976) and authorities cited. See J. W. Smith & H. B. Zobel, Rules Practice § 12.9 (1974). The facts alleged by the plaintiff in his affidavit in support of his claim of jurisdiction are essentially as follows. In September of 1971, the plaintiff saw the defendant's advertisement for the sale of two marine engines in a nautical publication entitled "Boats and Harbors," which was distributed in Massachusetts. The plaintiff, in Massachusetts, telephoned the defendant's place of business in Florida, spoke with its president, and ordered the engines. Thereafter, the plaintiff forwarded a check for the purchase price to the defendant. The defendant's president sent a letter to the plaintiff in Massachusetts confirming the sale. Several other letters sent by the defendant relative to the sale were received by the plaintiff in Massachusetts. Subsequently, the defendant shipped the engines from Florida to Massachusetts. On receipt of the engines the plaintiff discovered that, contrary to the defendant's prior representation of their perfect condition, the engines had sustained salt water damage before shipment. ²

The judge, in ruling on the motion to dismiss, filed a memorandum in which, for the purposes of the motion, he accepted the assertions contained in the plaintiff's affidavit as true. The judge recited the facts as detailed above, adding only that the bill of lading for the shipment of the engines to the plaintiff stated that the shipping "charges are to be collect." The judge ruled that the plaintiff did not "show sufficient contacts by Defendant with Massachusetts to enable its courts to exercise personal jurisdiction over the Defendant to the limits allowed by the Constitution of the United States," citing G.L. c. 223A, § 3(a ) and (b ).

General Laws c. 223A, § 3, as amended by St.1969, c. 623, ³ provides in part that "(a) court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a cause of action in law or equity arising from the person's (a ) transacting any business in this commonwealth; (or) (b ) contracting to supply services or things in this commonwealth." ⁴ In "Automatic" Sprinkler Corp. of America v. Seneca Foods Corp., 361 Mass. 441, 443, 280 N.E.2d 423, 424 (1972), we viewed the function of the long arm statute as "an assertion of jurisdiction over the person to the limits allowed by the Constitution of the United States." See Ross v. Ross, --- Mass. ---, ---, ^b 358 N.E.2d 437 (1976); Nichols Assocs. v. Starr, supra at ---, ^c 341 N.E.2d 909. In construing such limits, the United States Supreme Court has held that personal jurisdiction over a nonresident defendant requires "certain minimum contacts with (the State) such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.' " International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945) (quoting in part from Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 85 L.Ed. 278 (1940)). See Saporita v. Litner, --- Mass. ---, ---, ^d 358 N.E.2d 809 (1976); Ross v. Ross, supra; "Automatic" Sprinkler, supra, 361 Mass. at 444, 280 N.E.2d 423; Shaffer v. Heitner, 433 U.S. 186, 201-212, 97 S.Ct. 2569, 2579-2585, 53 L.Ed.2d 683 (1977); Hanson v. Denckla, 357 U.S. 235, 250-251, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958); McGee v. International Life Ins. Co., 355 U.S. 220, 222, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957). Amplifying on this, the Court has stated that in order for a nonresident defendant to be subject to jurisdiction, there must be "some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Hanson v. Denckla, supra, 357 U.S. at 253, 78 S.Ct. at 1240. See Ross v. Ross, supra; "Automatic" Sprinkler, supra. With these constitutional limitations in mind, we address below each of the defendant's jurisdictional claims under G.L. c. 223A.

1. Transacting Any Business.

General Laws c. 223A, § 3(a ), gives rise to jurisdiction if the defendant either directly or through an agent transacted any business in Massachusetts, and if the alleged breach of warranty arose from such transaction of business. From the scant and almost inadequate record before us, it appears that the defendant's only contacts with Massachusetts were the placement of an advertisement in a publication distributed in the Commonwealth, the receipt in Florida of a telephone call from the plaintiff in Massachusetts in regard to the purchase of the two engines, the sending of correspondence to the plaintiff confirming the sale, and the shipment of the engines "collect" to the plaintiff in Massachusetts. It is undisputed that the defendant's principal place of business is in Florida. It maintains no office in Massachusetts, nor does it own any property within the Commonwealth. It appears that neither the defendant, its corporate president, nor any of its agents has previously done business within the Commonwealth or had any contact here other than that detailed above. On these facts, and in light of the constitutional limitations previously discussed, we think the defendant's contacts with Massachusetts were insufficient to constitute the transaction of business in the Commonwealth so as to come within the reach of § 3(a ).

In "Automatic" Sprinkler, supra, we held that there were insufficient contacts to assert jurisdiction under G.L. c. 223A, § 3(a ), where the defendant's only contacts with the Commonwealth consisted of the affirmance of a contract and the making of partial payments pursuant to the contract through the mails. In that case, the defendant's agent signed a purchase order in New York and mailed it to the plaintiff's division in Massachusetts. In response, the defendant in New York received the plaintiff's invoice mailed from Massachusetts, as well as another letter acknowledging and accepting the defendant's purchase order. Subsequently, the defendant sent a partial payment of the purchase price to the plaintiff's division in Massachusetts. In holding that these contacts were insufficient to afford jurisdiction under § 3(a ), we characterized the defendant's activity as having little impact on commerce in Massachusetts, and concluded that the defendant did not "purposefully (avail) itself of the privilege of conducting activities within the forum State." "Automatic" Sprinkler, supra, quoting from Hanson v. Denckla, supra. Likewise here, where the defendant's contacts with the Commonwealth are not significantly greater than those of the defendant in "Automatic" Sprinkler, we view the sale of the engines to the defendant as an isolated transaction, with slight effect on the commerce of the Commonwealth ⁵ and as void of any purposeful intent on the part of the defendant to avail itself of the privilege of conducting activities within the forum State.

Cases in other jurisdictions, based on long arm statutes comparable to our own, have reached similar results. In the case of Morgan v. Heckle, 171 F.Supp. 482 (E.D.Ill.1959), the judge held that where the defendant's only contacts with Illinois were (a) the receipt in Tennessee of a telephone call from the plaintiff's agent in Illinois placing an order for goods and (b) the shipment of the ordered goods by a motor freight carrier to Illinois C.O.D., there were insufficient contacts to warrant the assertion of personal jurisdiction over the defendant in Illinois under the "transaction of any business" clause of...