Mower v. Nibley

• Decision Date: 18 August 2016
• Docket Number: No. 20150410–CA,20150410–CA
• Citation: 2016 UT App 174,382 P.3d 614
• Parties: Thomas Mower, Appellant, v. Richard Mcbride Nibley, Appellee.
• Court: Utah Court of Appeals

382 P.3d 614

2016 UT App 174

Thomas Mower, Appellant,

v.Richard Mcbride Nibley, Appellee.

No. 20150410–CA

Court of Appeals of Utah.

Filed August 18, 2016

Douglas B. Thayer and Jordan K. Cameron, Lehi, Attorneys for Appellant

Mark F. James and Mitchell A. Stephens, Salt Lake City, Attorneys for Appellee

Judge Kate A. Toomey authored this Memorandum Decision, in which Judge J. Frederic Voros Jr. and Senior Judge Pamela T. Greenwood concurred.¹

Memorandum Decision

TOOMEY, Judge:

¶1 Thomas Mower appeals the district court's dismissal of his suit against Richard McBride Nibley, a resident of Japan, for lack of general personal jurisdiction. Mower sought compensatory and punitive damages for the destruction of thousands of copies of a self-published book, titled “Straight Talk from an American Cowboy: How to Achieve Business Success in MLM,” committed to Nibley's possession. On appeal, we must determine whether Nibley waived his right to object to personal jurisdiction and whether Nibley is subject to general personal jurisdiction as a result of his contacts with the state. As to the first question, we conclude that he did not. And because he is not domiciled in Utah and lacks sufficient contacts with the state, we conclude Utah cannot exercise general personal jurisdiction over Nibley. We therefore affirm.

BACKGROUND

¶2 In 2006, Mower wrote and self-published his book.² He then paid for its translation into Japanese and entrusted Nibley with tens of thousands of copies to sell in Japan on Mower's behalf. At that time Nibley was employed by SISEL International, LLC, a Utah company Mower owned, but at some point before Mower began this action, Nibley's employment was terminated.

¶3 Shortly after Mower arranged for Nibley to sell his book, Mower was sentenced to serve a thirty-three-month sentence in federal prison for tax fraud. See United States v. Thompson , 518 F.3d 832, 838–49 (10th Cir. 2008). During his prison term, Mower did not communicate with Nibley regarding the books. Nibley continued selling the books, purportedly using the revenue to fund the operating costs of selling them. As a favor, one of Nibley's friends in Japan agreed to store the books free of charge. But by 2009, the proceeds from book sales were no longer enough to support operations, and the next year sales had slowed to a trickle, if not to a complete stop. Nibley's friend then informed Nibley that he could no longer store the books without charge, and Nibley allowed the warehouse owner to destroy the remaining books in March 2010.

¶4 Nibley has lived in Japan for more than thirty years, and has visited Utah only twice in the past ten years: once in 2008 for his father's funeral and again in 2011 for the birth of his granddaughter. He had no direct personal contact with Mower during either visit, but SISEL International served process on Nibley for an unrelated legal action while he was in Utah for his father's funeral.

¶5 As relevant to Mower's arguments, Nibley owned a partial interest in a rental property in Utah until it was sold at a sheriff's sale shortly after Mower filed his complaint in 2013. Nibley's wife retains her own partial interest in the property. According to Nibley's wife, “[T]here is no formal written agreement” regarding rent, and the renters pay a portion of the “rent money into [Nibley's] bank account on a monthly basis.”

¶6 In January 2013, Mower served Nibley in Japan, through a process server operating under the auspices of the United States Consulate, suing under theories of conversion, unjust enrichment, accounting, and constructive trust. Specifically, he alleged that Nibley profited and continues to profit from the sale of Mower's books and demanded that Nibley return any books still in his possession. Nibley did not respond or appear to defend himself, and the court clerk entered default. See Utah R. Civ. P. 55(a). Nearly twenty months later, Mower filed a motion to enter judgment for the amount of $629,200, with post-judgment interest.

¶7 In November 2014, Nibley responded with a pro se fill-in-the-blank opposition form, in which he laid out his inability to sell the books and the events leading up to their destruction. He denied any wrongdoing and any responsibility for the destruction of the books. He did not raise a personal jurisdiction objection, but did ask the court to deny Mower's motion to enter judgment and asked to dismiss the case.

¶8 Before a scheduled hearing on Mower's motion to enter judgment, Nibley filed two documents through counsel. In one, he moved the court to set aside entry of default and to dismiss Mower's action for lack of personal jurisdiction. In the other, he explained that his counsel's appearance was limited to challenging jurisdiction in order to void the entry of default, and was not a general appearance.

¶9 At the hearing on the motions, Mower argued Nibley had waived his right to challenge personal jurisdiction by “participating in this case” and by failing to raise the defense in his initial response. The court determined that Nibley's filing of his pro se opposition and sending emails to Mower's counsel and court clerks did not amount to the degree and type of participation sufficient to waive Nibley's right to challenge personal jurisdiction. Mower conceded that Utah could not exercise specific personal jurisdiction over Nibley, and the court rejected Mower's claim that Nibley's contacts with Utah were sufficient to establish general personal jurisdiction. Accordingly, the court granted Nibley's motion to set aside entry of default and dismissed Mower's complaint for lack of personal jurisdiction. Mower appeals.

ISSUES AND STANDARDS OF REVIEW

¶10 On appeal, Mower argues the district court erred in dismissing his suit for lack of general personal jurisdiction. We first address his argument that Nibley waived the right to challenge personal jurisdiction. If Nibley did not, we must then decide whether Nibley's contacts with Utah are sufficient to establish general personal jurisdiction.

¶11 Waiver presents a mixed question of law and fact. Pledger v. Gillespie , 1999 UT 54, ¶ 16, 982 P.2d 572. “[W]hether the trial court employed the proper standard of waiver presents a legal question which is reviewed for correctness, but the actions or events allegedly supporting waiver are factual in nature and should be reviewed as factual determinations, to which we give a district court deference.” Id.

¶12 “ ‘[A]n appeal from a pretrial jurisdictional decision made only on documentary evidence presents legal questions which we review for correctness.’ ” Hunsaker v. American HealthCare Capital , 2014 UT App 275, ¶ 9, 340 P.3d 788 (quoting Fenn v. Mleads Enters., Inc. , 2006 UT 8, ¶ 7, 137 P.3d 706 ). Further, “if the trial court proceeds on documentary evidence alone to determine whether personal jurisdiction is proper, ‘the plaintiff is only required to make a prima facie showing of personal jurisdiction.’ ” Id. (quoting Neways, Inc. v. McCausland , 950 P.2d 420, 422 (Utah 1997) ).

ANALYSIS

I. Waiver

¶13 Mower contends Nibley's chance to challenge jurisdiction ended when Nibley began participating in the suit by filing the November 2014 opposition to Mower's motion to enter judgment without objecting to the court's jurisdiction.³

¶14 Parties can waive an objection to jurisdiction by expressly waiving or by participating in the litigation without timely raising an objection or defense in a responsive pleading, such as an answer or reply. See Utah R. Civ. P. 12(b)(2), (h). But the Utah Supreme Court has held that in some circumstances a defendant's pro se response does not equate to a responsive pleading. See, e.g. , Parry v. Ernst Home Center Corp. , 779 P.2d 659, 661 (Utah 1989) (determining that the defendant “did not waive its jurisdictional claim through its pro se response” because it had not asked for affirmative relief from the court); Fibreboard Paper Products Corp. v. Dietrich , 25 Utah 2d 65, 475 P.2d 1005, 1005–06 (1970) (concluding that the defendant's pro se letter denying responsibility for the bill sued upon did not constitute an answer or a general appearance). Indeed, even when the defendant captions his pro se response “answer,” if the defendant merely denies responsibility for the injury or fails to ask for affirmative relief, the court has ruled that such a response cannot be construed as an answer or general appearance. See Parry , 779 P.2d at 661 ; cf. Trembly v. Mrs. Fields Cookies , 884 P.2d 1306, 1310 n.2 (Utah Ct. App. 1994) (“[T]he substance, not caption, of a motion is dispositive in determining the character of the motion.”). Thus, if the defendant's only participation in the litigation before objecting to personal jurisdiction is a pro se response that does not amount to a pleading or answer, the defendant has not waived a jurisdiction objection. See id.

¶15 Here, for nearly two years after Mower filed this action, Nibley did not respond or communicate with the court. Between January and June of 2014, Nibley exchanged emails with Mower's counsel and corresponded with court clerks. But the only document he filed with the court was his pro se opposition—a typewritten boilerplate opposition form. In his opposition, Nibley denied responsibility for the destruction of the books and emphasized that all activities regarding the book occurred in Japan. He did not request a hearing. Rather, in one line, he merely asked the court to deny Mower's motion for entry of judgment. Furthermore, Nibley never made an appearance with the court. Thus, we conclude that the district court did not err when it found that Nibley's pro se opposition did not constitute a responsive pleading under rule 12 of the Utah Rules of Civil Procedure, and that Nibley did not waive his personal jurisdiction objection.

II. Personal Jurisdiction

¶16 Mower argues that “[w]hen taken together, [Nibley's] foregoing contact with Utah has been, and continues to be, systematic and continuous, even though he is...