Ex parte British Steel Corp.

Decision Date20 September 1982
Citation426 So.2d 409
PartiesEx parte BRITISH STEEL CORP., etc. (re Jean S. STAGGS, etc. v. BRITISH STEEL CORP., et al. Mary Ellen DOROTHY v. BRITISH STEEL CORP., et al. Agnes SCOGIN, etc. v. BRITISH STEEL CORP., et al. Lynn BATES, etc. v. BRITISH STEEL CORP., et al.) 80-678 to 80-681.
CourtAlabama Supreme Court

James H. Miller, III and C. William Gladden, Jr. of Balch, Bingham, Baker, Hawthorne, Williams & Ward, Birmingham, for petitioners.

John W. Haley of Hare, Wynn, Newell & Newton, Birmingham, and James R. Knight of Knight & Griffith, Cullman, for respondents.

ADAMS, Justice.

In these petitions, British Steel Corporation seeks a writ of mandamus, or other appropriate writ, directing respondent, the Honorable John N. Bryan, circuit judge, to dismiss the action against it for lack of in personam jurisdiction. Plaintiffs are the administratrices of their respective decedents, all Alabama residents, who were killed in the collapse of a cofferdam in Pickens County, South Carolina, on October 6, 1978. Plaintiffs filed their actions for wrongful death on or before October 5, 1979, in the Circuit Court for Jefferson County. Following the denial of its motion to dismiss, British Steel Corporation (BSC) seeks an appropriate writ to compel dismissal.

The dispositive issue on this appeal is whether the trial court properly entertained in personam jurisdiction over BSC. Central to this issue is the question of whether in personam jurisdiction can be asserted against BSC in the courts of this state in compliance with the Due Process Clause of the 14th Amendment to the United States Constitution. After carefully reviewing the facts and analyzing the issue presented, we conclude that the trial court was correct in allowing in personam jurisdiction against BSC, and, therefore, we deny the writ.

The event which gave rise to plaintiffs' actions occurred when the Lake Keowee cofferdam collapsed, killing seven men. The cofferdam, located in South Carolina, was under construction at the time. Four actions are involved in this consolidated case and are the subjects of BSC's petitions. Three of plaintiffs' decedents were employees of Southern Construction and Engineering Company of Birmingham, Alabama. Southern Construction and Engineering Company was the general contractor for the project. The fourth decedent was a truck driver who also was employed by an Alabama employer. BSC, allegedly, manufactured and inspected the steel piling that formed the cofferdam's outer shell. Plaintiffs brought actions against several defendants, including BSC, alleging various theories of liability which we need not examine. BSC was served by certified mail pursuant to Rule 4.2, Alabama Rules of Civil Procedure, which provides the bases and methods of out-of-state service.

BSC's petitions, and the issue they raise, cause us to examine whether the facts in these cases allow in personam jurisdiction to be asserted against BSC in the courts of this state. The facts, as reflected in the record, overwhelmingly justify the assertion of in personam jurisdiction against BSC. No useful purpose, however, would be served in reviewing all of them. We, therefore, state and review the following facts which are sufficient for an understanding of these petitions.

BSC is a British corporation engaged in the manufacture and sale of steel products, which are sold internationally. Its principal place of business is London, England. BSC is not qualified to do business in Alabama. However, its wholly-owned subsidiary, 1 British Steel Corporation, Inc., is qualified to do business in this state. British Steel Corporation, Inc., (Houston) is a New York corporation with its principal place of business in Houston, Texas. It solicits orders from buyers in the United States for BSC steel products. The record discloses that thousands of tons of BSC steel were shipped into Alabama from 1977 through 1979. The sale of that steel was made through Houston.

Michael Webber was BSC's commercial manager for export sales from 1976-1980. He acknowledged, at deposition, that Houston was formed, and exists, to sell and distribute steel and steel products manufactured by BSC. Webber testified that BSC used Houston specifically for the purpose of selling its products in the United States. According to Webber, the final decision as to whether an order would be filled rested with BSC. Additionally, he testified that the entire administration of Houston reports regularly to British Steel Corporation International. Webber then explained that British Steel Corporation International, Ltd., 2 reported to BSC.

Webber's deposition also evidences the following facts showing the relationship between BSC and Houston. Webber, an employee of BSC, was "asked to join" the board of directors of Houston, which he did. Eric Walker is the man who asked him. Walker is chairman of the board of Houston. Like Webber, Walker is employed by BSC and is a native of England, where he resides. David Bonham holds the position of sales director with BSC. As in the cases of Walker and Webber, he is on the board of directors of Houston, and is a citizen and resident of England.

Richard Bledsoe is the general manager for distribution with L.B. Foster Company. He testified, at deposition, that L.B. Foster Company is located in Atlanta, Georgia, with a district sales office in Birmingham, Alabama. According to Bledsoe, the BSC steel piling used in the Lake Keowee project was purchased by Southern Construction and Engineering Company through L.B. Foster Company's Birmingham office. Bledsoe explained that the steel was supplied from the company's inventory throughout the United States, with the exception of a small amount contained in a customer's inventory. He testified that the company placed its orders for BSC steel with Houston.

Kenneth Fontaine was an employee of BSC when the Lake Keowee cofferdam collapsed. At deposition he testified that, then, he held the position of "sections metallurgist." Fontaine, who at the time of deposition was retired, testified that during the last few years of his employment with BSC, he was "more involved with investigating customer complaints than with [testing] the quality of steel," which was his previous job. Fontaine made an on-site inspection of the piling at Lake Keowee for BSC after a complaint was received. Apparently, that complaint was made by Southern Construction and Engineering Company and L.B. Foster Company. Fontaine explained that he understood Houston was the American selling agent for BSC.

We note several documents contained in the record which have bearing on the issue presented by these writs. BSC published two pieces of literature entitled "Steel Piling Products" and "Piling Handbook." Both indicated that BSC would provide technical assistance and advice concerning its piling products to customers. Webber's deposition reflects the fact that BSC prepares sales literature for Houston. The minutes of a special meeting of the board of directors of Houston, held on September 21, 1971, reveal that Houston was the collection agent for BSC. By resolution passed at a special meeting of the board of directors on October 10, 1975, T.B. Stone, the president of Houston, was authorized to request additional remuneration from BSC for Houston's services during that fiscal year.

Pursuant to plaintiffs' requests for admissions of fact, the following facts were established. BSC has sent agents into this state to transact business for it. BSC has availed itself of the opportunity of transacting business in Alabama. BSC "systematically and continuously ships goods manufactured by [it] into the State of Alabama and has done so since 1975."

Against the factual background described above, we apply the law pertaining to in personam jurisdiction. Rule 4.2, A.R.C.P., under which BSC was served, "has been found to extend to the permissible limits of due process." Bryant v. CEAT S.p.A., 406 So.2d 376 at 377 (Ala.1981), cert. denied, 456 U.S. 944, 102 S.Ct. 2008, 72 L.Ed.2d 466 (1982) (CEAT ); Semo Aviation, Inc. v. Southeastern Airways Corp., 360 So.2d 936 (Ala.1978); Sells v. International Harvester Co., 513 F.2d 762 (5th Cir.1975). The United States Supreme Court has observed that where a defendant conducted business that was "sufficiently substantial" in a forum state, a cause of action unrelated to its activities in the forum could be asserted against it there. Perkins v. Benguet Consolidated Mining Co., 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed. 485 (1952). Similarly, in International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), the court remarked that "continuous corporate operations" within a forum could subject a corporate defendant to in personam jurisdiction on a cause of action arising outside the forum. In the case of a corporate defendant which maintains a parent-subsidiary relationship with another corporation, it is the rule that the parent's use of the subsidiary in the forum "does not necessarily subject the parent to the jurisdiction [of the forum] ...." Cannon Manufacturing Company v. Cudahy Packing Company, 267 U.S. 333, 45 S.Ct. 250, 69 L.Ed. 634 (1925).

This court recently recognized that

a forum state may exercise in personam jurisdiction over a nonresident defendant so long as there are such minimum contacts that the suit does not offend "traditional notions of fair play and substantial justice." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292, 100 S.Ct. 559, 564, 62 L.Ed.2d 490 (1980) (quoting International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945)).

CEAT, at 377. Our review of the facts given above leads us to conclude that BSC's activities are substantial and continuous so as to allow in personam jurisdiction to be asserted against it in causes of action which may have arisen outside of Alabama. BSC argues that it is not physically...

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