Michiana Easy Livin' Country Inc. v. Holten

• Decision Date: 09 October 2003
• Docket Number: No. 01-02-00439-CV.,01-02-00439-CV.
• Citation: 127 S.W.3d 89
• Parties: MICHIANA EASY LIVIN' COUNTRY INC. d/b/a Michiana R.V., Appellant, v. James G. HOLTEN, Appellee.
• Court: Texas Court of Appeals

127 S.W.3d 89

MICHIANA EASY LIVIN' COUNTRY INC. d/b/a Michiana R.V., Appellant, v. James G. HOLTEN, Appellee.

No. 01-02-00439-CV.

Court of Appeals of Texas, Houston (1st Dist.).

October 9, 2003.

Rehearing Overruled November 21, 2003.

William G. Rossick, Watson & Rossickr, Austin, for appellant.

Neal David Kieval, Thomas M. Gregor, Brock C. Akers, Phillips & Akers, P.C., Houston, for appellee.

Panel consists of Chief Justice RADACK and Justices NUCHIA and HANKS.

OPINION ON REHEARING

SHERRY RADACK, Chief Justice.

We withdraw our opinion of March 13, 2003 and issue the following in its stead. Appellant's motion for rehearing is granted.

This is an interlocutory, accelerated appeal from the trial court's denial of a special appearance filed by appellant, Michiana Easy Livin' Country, Inc. d/b/a Michiana R.V. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(7) (Vernon Supp. 2003). Michiana argues that the trial court erred by denying its special appearance for the following reasons (1) the trial court did not have personal jurisdiction over Michiana because the Texas long-arm statute does not reach Michiana and (2) Michiana had not established the minimum contacts required by federal due process in order for Texas courts to assert jurisdiction over it. We affirm.

Background

On July 14, 2001, appellee, James G. Holten, brought suit against Ford Motor Company, Coachmen Industries, Inc., Michiana, and Coachmen Recreational Vehicle Company. Holten alleged that he was a resident of Harris County, Texas and that the subject matter of his suit, a motor home, was also located in Harris County, Texas. Holten alleged that he had entered into a contract with Michiana to purchase a Class A Coachmen Catalina motor home manufactured by Coachmen and equipped with a Ford Engine and that he had taken delivery of the motor home in July 1998.

Holten alleged that, at the time he purchased the motor home, Michiana represented to him that (1) the motor home would be constructed with all solid wood material connected with screws, (2) the motor home's coach would not contain nails or staples, (3) the motor home would contain a bathtub and a shower, (4) the motor home would contain a double-pedal, foot-flush toilet, (5) the motor home could be serviced by any authorized Ford dealer, and (6) the motor home would comply with other specifications listed by Holten. Holten further alleged that these conditions were not met and that the breach of these conditions constituted a violation of the Texas Deceptive Trade Practices Consumer Protection Act, as well as common law fraud, breach of warranty, and breach of contract.

Ford Motor Company, Coachmen Recreational Vehicle Company, and Coachmen Industries, Inc. filed answers, but Michiana filed a special appearance and answered subject to its special appearance.

Michiana's special appearance asserted that the trial court did not have jurisdiction over it for the following reasons: (1) Michiana is an Indiana corporation that is not a resident of Texas, has no agent for service in Texas, has no property or employees in Texas, and is not authorized to do business in Texas; (2) Michiana does not advertise or have an Internet presence; (3) Holten contacted Michiana on his own initiative to arrange for Michiana to sell him a Coachmen motor home; (4) Michiana delivered the Coachmen motor home in Indiana to an independent third-party carrier who brought the motor home to Texas; (5) all communications between Michiana and Holten were conducted over the telephone; (6) all payments were made to Michiana in Indiana; (7) Holten was originally scheduled to accept delivery of the motor home in Indiana; and (8) the sales contract signed by Holten contained a forum selection clause designating Indiana as the forum state of all disputes arising from the sale of the motor home.

The trial court denied Michiana's special appearance.

Special Appearance

Standard of Review

The plaintiff bears the initial burden of pleading sufficient allegations to bring a non-resident defendant within the personal jurisdiction of a Texas court. BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 793 (Tex.2002). A defendant bears the evidentiary burden of challenging the court's assertion of personal jurisdiction by negating all jurisdictional bases. Id. Existence of personal jurisdiction is a question of law, reviewed de novo, but that determination must sometimes be preceded by the resolution of underlying factual disputes. Preussag Aktiengesellschaft v. Coleman, 16 S.W.3d 110, 113 (Tex.App.Houston [1st Dist.] 2000, pet. dism'd w.o.j.). Although findings of fact are not required, see Tex.R.App. P. 28.1, if the trial court does not file findings of fact in a special appearance, all questions of fact are presumed to support the judgment. Ace Ins. Co. v. Zurich Am. Ins. Co., 59 S.W.3d 424, 427 (Tex.App.Houston [1st Dist.] 2001, pet. denied).

The Texas Long-Arm Statute

A Texas court may assert personal jurisdiction over a non-resident defendant only if the requirements of both the Texas long-arm statute and the United States Constitution are satisfied. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414, 104 S.Ct. 1868, 1872, 80 L.Ed.2d 404 (1984); CSR, Ltd. v. Link, 925 S.W.2d 591, 594 (Tex.1996). The Texas long-arm statute allows a Texas court to exercise personal jurisdiction over a non-resident defendant who does business in Texas. Tex. Civ. Prac. & Rem.Code Ann. § 17.042 (Vernon 1997). A non-resident does business in Texas if it:

(1) contracts by mail or otherwise with a Texas resident and either party is to perform the contract in whole or in part in this state;

(2) commits a tort in whole or in part in this state; or

(3) recruits Texas residents, directly or through an intermediary located in this state, for employment inside or outside this state.

Id. In addition, the statute provides that "other acts" by the non-resident can satisfy the requirement of "doing business" in Texas. Id.; Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 226 (Tex.1991). The Texas Supreme Court has interpreted this broad statutory language to reach "as far as the federal constitutional requirements of due process will permit." BMC, 83 S.W.3d at 795. Therefore, the requirements of the Texas long-arm statute are satisfied if the exercise of personal jurisdiction comports with federal due process limitations. CSR, 925 S.W.2d at 594.

Federal Due Process Limitations on Personal Jurisdiction

Under the limits of federal due process, a state may exert personal jurisdiction over a non-resident defendant only if the defendant has some minimum, purposeful contacts with the state, and the exercise of jurisdiction will not offend traditional notions of fair play and substantial justice. Dawson-Austin v. Austin, 968 S.W.2d 319, 326 (Tex.1998). A non-resident who has purposely availed himself of the privileges and benefits of conducting business in Texas has sufficient contacts with the forum to confer personal jurisdiction. CSR, 925 S.W.2d at 594. However, a defendant should not be subject to the jurisdiction of a Texas court based upon random, fortuitous, or attenuated contacts. Id. at 595. The purposeful availment requirement ensures that the non-resident defendant's contact must result from its purposeful contact, not the unilateral activity of the plaintiff or a third party. See Guardian Royal, 815 S.W.2d at 227; AmQuip Corp. v. Cloud, 73 S.W.3d 380, 385 (Tex.App.-Houston [1st Dist.] 2002, no pet.). It is the quality and nature of the contacts, rather than their number, that is important. Guardian Royal, 815 S.W.2d at 230 n. 11. The exercise of personal jurisdiction is proper when the contacts proximately result from actions of the non-resident defendant which create a substantial connection with the forum state. Id. at 226.

Foreseeability

Foreseeability is an important, although not determinative, consideration in deciding whether the non-resident has purposefully established minimum contacts with the forum state. CSR, 925 S.W.2d at 595; Guardian Royal, 815 S.W.2d at 227. The concept of foreseeability is implicit in the requirement that there be a substantial connection between the non-resident defendant and Texas arising from actions or conduct of the non-resident defendant purposefully directed toward Texas. Guardian Royal, 815 S.W.2d at 227. If a tortfeasor knows that the brunt of the injury will be felt by a particular resident in the forum state, he must reasonably anticipate being haled into court there to answer for his actions. Memorial Hosp. Sys. v. Fisher Ins. Agency, Inc., 835 S.W.2d 645, 650 (Tex.App.-Houston [14th Dist.] 1992, no writ).

General Jurisdiction

A defendant's contacts with a forum can give rise to either general or specific jurisdiction. CSR, 925 S.W.2d at 595. General jurisdiction is present when a defendant's contacts are continuous and systematic, allowing the forum to exercise personal jurisdiction over the defendant even if the cause of action did not arise from or relate to activities conducted within the forum state. Guardian Royal, 815 S.W.2d at 228. General jurisdiction requires a showing that the defendant conducted substantial activities within the forum, a more demanding minimum contacts analysis than for specific jurisdiction. Id.

Specific Jurisdiction

Specific jurisdiction, however, is established if the defendant's alleged liability arises from or is related to an activity conducted within the forum. Id. at 227. When specific jurisdiction is asserted, the minimum contacts analysis focuses on the relationship between the defendant, the forum, and the litigation. Blair Communications, Inc. v. SES Survey Equip. Services, Inc., 80 S.W.3d 723, 727 (Tex.App.-Houston [1st Dist.] 2002, no pet.); Memorial Hosp. Sys., 835 S.W.2d at 650. The contacts must be purposely directed at or take place within the forum, and must have a "substantial...