Hales v. First Appalachian Corp.

• Decision Date: 30 July 1980
• Docket Number: No. C.A. 77-M-581.,C.A. 77-M-581.
• Citation: 494 F. Supp. 330
• Parties: Philip HALES, Plaintiff, v. FIRST APPALACHIAN CORPORATION, South African Iron & Steel Industrial Corporation, Ltd., Defendants.
• Court: U.S. District Court — Northern District of Alabama

494 F. Supp. 330

Philip HALES, Plaintiff, v. FIRST APPALACHIAN CORPORATION, South African Iron & Steel Industrial Corporation, Ltd., Defendants.

No. C.A. 77-M-581.

United States District Court, N. D. Alabama, S. D.

July 30, 1980.

R. Ben Hogan, Hogan, Smith & Alspaugh, Birmingham, Ala., Roger Killian, Fort Payne, Ala., Robert H. King, Gadsden, Ala., for plaintiff.

Charles A. McGee, Traylor, Baker & McGee, Fort Payne, Ala., T. Thomas Cottingham, Thomas, Taliaferro, Forman, Burr & Murray, Birmingham, Ala., Kenneth L. Everett, Rogers, Hoge & Hills, New York City, for defendants.

MEMORANDUM OPINION

McFADDEN, Chief Judge.

This diversity suit was originally commenced by plaintiff, a citizen of Alabama, against First Appalachian Corporation (FAC) to recover money for the sale of coal pursuant to written contract.

Two years after the complaint was filed, plaintiff amended to add ISCOR as a party defendant, alleging a direct contractual arrangement with this defendant. Plaintiff claims that ISCOR, acting through FAC, agreed to buy coal from plaintiff. Plaintiff also alleges claims for conversion, for goods had and received, and on open account.

This cause is before the court on the alternative motion of defendant ISCOR to dismiss, for judgment on the pleadings or for summary judgment. ISCOR claims that plaintiff has failed to state a claim upon which relief can be granted and that this court lacks jurisdiction over the person of this defendant.

The facts as revealed in the pleadings and affidavits are not in dispute.

In April 1976, ISCOR published its intent to purchase a quantity of coal and invited tenders. In May 1976, counsel for the plaintiff sent a response to ISCOR's notice. ISCOR sent four representatives to the United States to visit eight sources selected from the responses received. These representatives came to Birmingham, Alabama, on June 24, flew to Ft. Payne, inspected a coal tipple and two mines, took a sample of coal from one mine, flew to Mobile to inspect the State docks, and returned to Birmingham, all on the same day. These representatives remained in Birmingham on June 25, 1976 inspecting laboratories, visiting a coal operation and visiting a barge operation.

On June 26, 1976, the group left Alabama, returning on June 28 to Ft. Payne, Alabama, where they visited a laboratory and washery and took additional samples of coal, returning to Birmingham that evening. On June 29, 1976, barge loading facilities on the Warrior River were visited; on June 30, coal facilities in the Jasper area were visited. The group left Alabama on July 1.

After visiting several other United States cities, the group traveled to Washington, D. C. on July 8, 1976. On July 14, 1976, a contract was signed in Pittsburgh, Pennsylvania by A. R. Black, President of FAC, and A. D. Schoeman, Materials Manager of ISCOR. Under this contract and pursuant to subsequent correspondence FAC agreed to have certain coal delivered to the Mobile dock in August, 1976. ISCOR nominated a vessel which picked up coal delivered to Mobile by FAC.

After the coal was in route to South Africa it was determined that it did not meet contract standards. Subsequently, ISCOR and FAC negotiated an agreeable price for the inferior quality coal. Payment was made in accordance with this agreement.

After ISCOR had entered into a contract with FAC, the plaintiff's attorney continued to correspond with ISCOR indicating a continued desire to sell coal to ISCOR. On July 27, the plaintiff was notified by letter that he would not be awarded a contract by ISCOR.

On August 6, 1976, FAC entered into a separate contract with plaintiff for the sale of 48,000 metric tons of coal at $46 per ton. This contract incorporated by reference the contract, dated July 14, 1976, between FAC and South African Iron and Steel Industrial Corporation (ISCOR) for the sale of 45,000 metric tons of coal at $49 per ton. The Hales-FAC contract was for the same coal FAC had sold to ISCOR. Hales in the contract with FAC undertook to perform all of FAC's obligations to ISCOR in the earlier contract with certain exceptions. This was not known to ISCOR.

The initial question is whether this activity is sufficient to give the court in personam jurisdiction over defendant ISCOR. Normally, the question of jurisdiction is determined first before there is any treatment of the merits of a claim, although a court may receive evidence limited to jurisdictional matters. Bickham v. Miller, 584 F.2d 736 (5th Cir. 1978). Here, however, the two issues are intertwined. Defendant ISCOR contends that on the undisputed evidence there was no contract and therefore no jurisdiction. ISCOR also claims that since there was no contract, it is entitled to summary judgment even if the court has jurisdiction. This requires an examination of the merits of the claims put at issue by the motion for summary judgment.

On a motion for summary judgment, the burden is initially upon the moving party to establish that there is no genuine issue as to any material fact. The movant's evidence may be in the form of affidavits and is strengthened by the use of documents. In fact, where the movant supports his motion with affidavits and documents evidencing a high degree of credibility, the opponent must produce convincing proof attacking the documents in order to defeat the motion. 10 Wright & Miller, Federal Practice and Procedure, § 2727. If the movant makes out a prima facie case that would entitle him to a directed verdict if uncontroverted at trial, summary judgment must be granted unless the opposing party offers some competent evidence that could be presented at trial showing that there is a genuine issue as to some material fact. First National Bank of Arizona v. Cities Service Company, 391 U.S. 253, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968).

Where the moving party has made out a prima facie case showing that there are no genuine factual issues and that he is entitled to summary judgment as a matter of law, the burden of producing evidence shifts to the opposing party which must meet this burden with affidavits setting forth specific facts to show why there is an issue for trial. Gossett v. Du-Ra-Kel Corporation, 569 F.2d 869 (5th Cir. 1978). The opposing party does not meet his burden merely by asserting in the pleadings or even by affidavit that a genuine issue exists for trial. United States v. Hodnett, 347 F.Supp. 1018 (M.D.Ala.1972). He cannot meet his burden by stating general assertions or legal conclusions, Liberty Leasing Co., Inc. v. Hillsum Sales Corp., 380 F.2d 1013 (5th Cir. 1967), nor is he entitled to a trial on the basis of a hope that he can produce some evidence at that time. DeBardeleben v. Cummings, 453 F.2d 320 (5th Cir. 1972). Neither frivolous assertions nor unsupported statements nor illusory issues nor mere suspicions will suffice to justify a denial of summary judgment. The court may disregard evidence that is too incredible to be believed. The evidence offered by the opposing party must be admissible at trial and must have the force needed to allow a jury to rely on it.

In DeBardeleben v. Cummings, supra, the Fifth Circuit affirmed the granting of summary judgment by the trial court and said:

Summary judgment, often thought to be unavailable, is once again proved to be a valuable tool in the law's effort to stem the tide of flooding litigation. The parties are not to be trapped into waiving a plenary trial on issues that really exist. But neither is the Judge, the opposition nor the jurisprudence to be trapped by feigning an issue, so non-existent as to be unrealized by combatting adversaries, in order to require a trial not on substantial issues but on ones that at most were merely not expressly negated and at best involved only `the optimistic hope that something might turn up.' Bruce Construction Corp. v. United States, 5 Cir. supra, 242 F.2d 873 at 878. Such an approach is a distortion of the whole spirit of F.R.Civ.P. 56.

453 F.2d at 326-327 (emphasis added).

Mr. Schoeman's uncontroverted affidavit and the documents attached thereto establish conclusively that there was no contract between ISCOR and plaintiff; that ISCOR does not owe plaintiff any money by reason of an open account; that ISCOR does not owe plaintiff money for goods had and received; and that ISCOR has not converted to its own use any coal belonging to plaintiff. Hales has not produced any evidence raising any material issue of fact. The material facts stated in Mr. Schoeman's affidavit are not disputed and are due to be taken as true.

Plaintiff has offered general assertions which, without more, cannot be held to show genuine issues of material facts. The motion for summary judgment is therefore due to be granted. The court is further of the opinion that because there was no contract there is no jurisdiction over this defendant.

The issue of in personam jurisdiction logically must be determined according to a two step analysis. In Walker v. Newgent, 583 F.2d 163 (5th Cir. 1978), the court stated:

In deciding whether the state jurisdictional statute confers jurisdiction over a nonresident defendant in a diversity suit, it must be determined that (1) the defendant is in fact amenable to service under the statute (state law of the forum controls this question), and (2) if the state statute has been complied with, then federal law must be applied to determine whether assertion of jurisdiction over the defendant comports with due process. Jetco Electronic Industries, Inc. v. Gardiner, 473 F.2d 1228 (5th Cir. 1973); Product Promotions, Inc. v. Cousteau, 495 F.2d 483 (5th Cir. 1974); Wilkerson v. Fortuna Corp., 554 F.2d 745 (5th Cir. 1977).

583 F.2d at 166.

However, under Alabama Rule of Civil Procedure 4.2(a)(2)(I) as presently interpreted by the Alabama Supreme Court, the personal jurisdictional issue seems to be a single question, i. e., whether federal due process standards have been met. This, in my judgment,...