Kramer v. Vogl

• Citation: 267 N.Y.S.2d 900,17 N.Y.2d 27,215 N.E.2d 159
• Parties: , 215 N.E.2d 159 Walter KRAMER, doing business as Walter Kramer Leather Co., Appellant, v. Ludwig VOGL et al., Individually and as Copartners doing business as Lederfabrik Fr. Vogl, et al., Respondents, et al., Defendants.
• Decision Date: 17 February 1966
• Court: New York Court of Appeals Court of Appeals

Page 900

267 N.Y.S.2d 900

17 N.Y.2d 27, 215 N.E.2d 159

Walter KRAMER, doing business as Walter Kramer Leather Co., Appellant, v. Ludwig VOGL et al., Individually and as Copartners doing

business as Lederfabrik Fr. Vogl, et al.,

Respondents, et al., Defendants.

Court of Appeals of New York.

Feb 17, 1966.

Rachel B. Backer, New York City, for appellant.

Solomon S. Goldsmith and Nathaniel M. Gallin, New York City, for respondents.

DESMOND, Chief Judge.

This is another case where the New York courts under CPLR 302 (subd. (a)) are asked to exercise personal jurisdiction over a nondomiciliary on the theory that the cause of action sued upon has arisen from transaction of 'any business within the state' or has arisen from the commission of a 'tortious act within the state'. In this instance both courts below held against jurisdiction and so dismissed the first cause of action (Kramer against Vogl). We granted leave to appeal.

Plaintiff is a resident of this State and does business in New York City as a dealer in imported leather. The action is for fraud. The summons and complaint were served personally on defendants-respondents in Austria where they live and carry on the business of producing and marketing 'Vogl' leathers. Generally it is theory of the complaint that plaintiff suffered damage because of the willful fraud and deceit of defendants Vogl in that the latter, when appointing plaintiff as defendants' exclusive United States agent to import and distribute defendants' leather products, made intentionally false representations to plaintiff that Vogl leather would not be supplied to anyone else in this country in competition with plaintiff. Plaintiff charges that to induce him to purchase Vogl leathers and to promote their sale in the United States to plaintiff's customers the Vogl defendants falsely promised not to sell these products to anyone else in the United States (except one named customer) and that relying on these promises plaintiff purchased from defendants and imported to the United States large quantities of Vogl leathers and spent such time and effort in advertising and promoting the sale of these wares. From August, 1960 to March, 1962, plaintiff avers, this arrangement continued and in the latter month the arrangement was renewed with a repetition by defendants of the same warranties as to sole representation. However, so plaintiff alleges, defendants never intended to keep these promises and in fact at the time of the renewal in March, 1962 had already arranged to sell and had sold and continued to sell their wares to the defendants Chilewich and their associated companies, all of this causing great damage to plaintiff. On this appeal we are not concerned with the complaint's second cause of action which runs against the chilewich defendants only.

All shipments from Vogl to plaintiff were, as agreed, f. o. b. European ports. It is the position of the Vogls that not only did they never do any business in New York but that plaintiff was never given the sole United States agency, that even if plaintiff was appointed sole American agent the one-year contract was never renewed, and, also, that the 'tortious acts' of defendants Vogl, if any, were committed not in New York State but in Austria. It is undisputed that the original contract between plaintiff and defendants Vogl was arranged at a meeting in Paris in 1959 and that when plaintiff returned to New York defendants from Austria wrote to plaintiff in New York a letter confirming the conversation in which plaintiff had been granted the sold American agency for one year. Plaintiff was not paid by the Vogls on a salary or commission basis but bought the leather and paid for it.

Defendants moved to dismiss the complaint on the ground that the Vogl defendants had never transacted any business in the State of New York and that the court has not acquired personal jurisdiction as to them.

Both courts below wrote brief opinions to the effect that defendants Vogl did not have the 'minimum contacts' in New York State necessary for acquisition of personal jurisdiction over them and that any cause of action arising out of the transaction between the parties did not arise from a tortious act within the meaning of subdivision (a) of CPLR 302. One of the Justices at the Appellate Division, concurring, took the position that, while the complaint may to construed to show a tortious act within this State in the sense of damage done here, that nonetheless any activity of the Vogl defendants within this State was not sufficient to satisfy the constitutional requirements of due process.

We first look to see whether there is a sufficient showing here under paragraph 2 of subdivision (a) of 302 that is, whether the papers show the commission by defendants Vogl of a tortious act within this State. The argument on behalf of plaintiff is that the last act of the fraud was committed in New York when Vogl sent merchandise to Chilewich, also that the damage to plaintiff was done in New York. A difficulty is, however, that in Feathers v. McLucas and Singer v. Walker, 15 N.Y.2d 443, 261 N.Y.S.2d 8, 209 N.E.2d 68, we have given restrictive meaning to the requirement that there be a showing of a tortious act committed in this State and have made it clear that the statutory phrase is not synonymous with 'commits a tortious act without the state...