Fields v. INA Filtration Corp.

• Decision Date: 20 May 1987
• Docket Number: No. 0971,0971
• Citation: 358 S.E.2d 160,292 S.C. 614
• Court: South Carolina Court of Appeals
• Parties: Earl FIELDS, Respondent, v. INA FILTRATION CORPORATION and Jochen Schoeller, of whom Jochen Schoeller is Appellant. Appeal of Jochen SCHOELLER. . Heard

Page 160

358 S.E.2d 160

292 S.C. 614

Earl FIELDS, Respondent, v. INA FILTRATION CORPORATION and Jochen Schoeller, of whom Jochen Schoeller is Appellant Appeal of Jochen SCHOELLER.

No. 0971.

Court of Appeals of South Carolina.

Heard May 20, 1987.

Decided June 8, 1987.

H. Carlisle Bean, of Bean and Bean, Spartanburg, for appellant.

Jack W. Lawrence, of Lawrence, Shaw and Boggs, Spartanburg, for respondent.

CURETON, Judge:

Jochen Schoeller appeals an order of the trial court finding him subject to personal jurisdiction in South Carolina in a suit brought by Earl Fields for breach of contract, payment on a promissory note, and damages for fraud. We affirm.

Jochen Schoeller, a German national residing in Duren, Germany, is a 75 percent shareholder and Chairman of the Board of Directors of INA Filtration Corporation, a South Carolina corporation with its principal place of business in Spartanburg County. INA was incorporated in 1974 to import woven wire cloth for sale in this country. At the time of its incorporation, Schoeller and his father were both shareholders in the corporation. In 1981 Schoeller became sole shareholder. Fields became an employee of INA in February 1979 and was made president of the corporation on January 1, 1980. Both appointments were made subject to employment and salary agreements.

On June 18, 1981, Schoeller executed a stock option agreement by which Fields could purchase twenty-five percent of INA's stock from Schoeller. The option provides that Field's death or termination of employment with INA shall constitute an irrevocable offer to sell all shares to Schoeller calculated at the book value on the preceeding December 31st. If Schoeller is unable or unwilling to purchase the shares, INA corporation "will have the right and duty to purchase said shares on the same terms and conditions as Jochen Schoeller might have purchased same." In 1983 and 1984, 250 shares of stock were transferred from Schoeller to Fields. On November 26, 1984, Schoeller wrote a letter confirming an agreement with Fields to transfer to Fields the remaining shares under the option, equalling 1000 shares of INA stock. This transaction was apparently carried out.

On January 1, 1985, INA issued a promissory note to Fields in the amount of $66,500.00 at nine percent interest calculated annually. This note was issued to Fields as a result of his ownership of 25% of the corporation's stock. Apparently, between 1974 and 1979 the shareholders had loaned the corporation $546,000.00. Tax Consultants recommended converting $266,000.00 of that sum to a stockholder's loan. The $66,500.00 note represented 25 percent of that sum, or Field's interest in the corporation.

Fields gave verbal notice of his resignation as president to Schoeller on October 29, 1985, and written notice to the Board of Directors on October 30, 1985. Fields later commenced this action against INA and Schoeller for bonuses and salary allegedly due him under the employment agreements, to enforce the sale of INA stock pursuant to the stock purchase agreement, for principal and interest payments due on the promissory note, and for actual and punitive damages for fraud.

Schoeller moved to dismiss the action for lack of personal jurisdiction under S.C.R.Civ.P. 12(b)(2), claiming he was not a South Carolina resident, was not doing business in this State, and had no minimum contacts with this State. Schoeller filed three affidavits. Fields entered an opposing affidavit and a deposition of the attorney for INA and Schoeller. The trial judge denied the motion to dismiss for lack of personal jurisdiction. Based on the stock option agreement and its performance, the judge found jurisdiction proper under Section 36-2-803(1)(g), which provides personal jurisdiction over parties to a contract to be performed in whole or in part in this State. The judge further found Schoeller had not addressed the allegations of fraudulent acts in Field's complaint and affidavit, which make a prima facie showing of a tortious act committed here sufficient to grant jurisdiction under Section 36-2-803(1)(c). The judge also found Schoeller was transacting business in this State sufficient to render jurisdiction under Sections 36-2-802 and 36-2-803(1)(a).

As a general rule, appellate courts will be bound by factual findings of a lower court made in response to motions preliminary to trial where there is conflicting evidence. Berkeley PG Corp. v. Candler and Lundeen, 291 S.C. 315, 353 S.E.2d 305 (Ct.App.1987); City of Chester v. Addison, 277 S.C. 179, 284 S.E.2d 579 (1981), appeal dismissed, Addison v. City of Chester, South Carolina, 456 U.S. 967, 102 S.Ct. 2227, 72 L.Ed.2d 840 (1982). We need determine, therefore, merely whether there is any evidence in the record to support the trial court's finding of personal jurisdiction.

Under Code Section 36-2-802, our courts have personal jurisdiction over a person doing business in this State. The trial judge found personal jurisdiction over Schoeller under this statute. Schoeller did not except to this finding and has not argued the finding of jurisdiction under this Code Section in his brief. Where no exception is taken to findings of fact or conclusions of law, they become the law of the case. Ashy v. WeCare Distributors, Inc., 289 S.C. 526, 347 S.E.2d 123 (Ct.App.1986).

Despite this, however, we find the trial court properly found personal jurisdiction over Schoeller pursuant to ...