Mulhern v. Holland America Cruises

• Decision Date: 02 May 1975
• Docket Number: Civ. A. No. 74-325.
• Citation: 393 F. Supp. 1298
• Parties: Pauline MULHERN and Thomas P. Mulhern v. HOLLAND AMERICA CRUISES.
• Court: U.S. District Court — District of New Hampshire

393 F. Supp. 1298

Pauline MULHERN and Thomas P. Mulhern v. HOLLAND AMERICA CRUISES.

Civ. A. No. 74-325.

United States District Court, D. New Hampshire.

April 30, 1975.

As Amended May 2, 1975.

COPYRIGHT MATERIAL OMITTED

John V. Dwyer, Jr., Hamblett, Kerrigan, LaTourette & Lopez, Nashua, N. H., for plaintiffs.

Claudia C. Damon, Sheehan, Phinney, Bass & Green, Manchester, N. H., for defendant.

MEMORANDUM OPINION ON MOTION TO DISMISS

BOWNES, District Judge.

Plaintiff is a New Hampshire resident. She brings suit against Holland America alleging that, while a passenger on board the S.S. Rotterdam, she received personal injuries when, as a consequence of defendant's negligence, she fell down a common stairway. In addition, plaintiff alleges that her injuries were compounded as a result of defendant's failure to provide her with proper medical treatment. Defendant, Holland America, is incorporated in the Netherland Antilles and has its principal place of business in New York. Diversity exists between the parties and the amount in controversy exceeds $10,000. 28 U.S. C. § 1332.

Defendant moves to dismiss the action on the ground that this court cannot, within the parameters of the due process clause of the Fourteenth Amendment, exercise in personam jurisdiction over it. Service was made upon the defendant pursuant to the provisions of the New Hampshire "long-arm" statute. The New Hampshire "long-arm" statute provides in pertinent part:

. . . Whenever any foreign corporation authorized to transact, or transacting business in this state shall fail to appoint or maintain in this state a registered agent upon whom service of legal process or service of any such notice or demand may be had, . . . the secretary of state shall be and hereby is irrevocably authorized as the agent and representative of such foreign corporation to accept service of any process or service of any notice or demand required or permitted by law to be served upon such corporation. NH RSA 300:11(c).

FACTS

Defendant is engaged in the organization and selling of vacation cruises. As part of its business, defendant sells cruises on the S.S. Rotterdam. In order to promote the Rotterdam Cruise, defendant distributed promotional brochures to thirty-four New Hampshire travel agencies. In addition, defendant provided five local travel agencies with blank copies of its cruise passage contract.

The facts, although scanty, indicate that plaintiff, desiring to go on a vacation, visited a travel agency in Milford, New Hampshire. As a result of this contact, she booked passage for a cruise on board the S.S. Rotterdam. In order to arrange her passage, the travel agent called the defendant in New York. The defendant then forwarded to the travel agency a copy of its cruise passage contract; plaintiff paid the travel agent and received her ticket.

With ticket in hand, plaintiff traveled to New York where she embarked on her cruise. While on board ship, in Hamilton Harbor, Bermuda, plaintiff fell down a stairway breaking her ankle. She alleges that defendant was negligent in its failure to provide a safe passageway, or, in the alternative, a failure to warn her of the stairway's hazardous condition. Plaintiff further alleges that her injuries were compounded as a result of defendant's negligent medical treatment.

At the hearing counsel for the defendant represented to the court that, on the cruise in question, defendant's sole function was to supply the Rotterdam with passengers and that it had no control over the ship's maintenance, crew, or the services provided. Defendant stated that the responsibility for the ship's maintenance and the crew's performance was borne by the N.V. Mailschip Antilles. If this proves to be true, then Mailschip is an indispensable party to this action. Mailschip has had no contacts with New Hampshire and is, therefore, not subject to its "long-arm" jurisdiction.

RULING AND ANALYSIS

The touchstone in any jurisdictional dispute is the standards enunciated in International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), and McGee v. International Life Insurance Co., 355 U.S. 220, 78 S. Ct. 199, 2 L.Ed.2d 223 (1957). These cases establish the principle that, in order to subject a foreign corporation which is not incorporated in the forum state to in personam jurisdiction, due process requires that the defendant have some "minimum contacts" with the forum state so that the institution of suit does not offend "traditional notions of fair play and substantial justice."

It is essential in each case that there be some act by which the defendant purposely avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws. Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1240, 2 L.Ed. 2d 1283 (1958).

The amenability of a foreign corporation to local process in a diversity suit "is determined in accordance with the law of the forum state." Seymour v. Parke, Davis & Company, 294 F.Supp. 1257, 1259 (D.N.H.1969), aff'd, 423 F.2d 584 (1st Cir. 1970).

In Roy v. North American Newspaper Alliance, 106 N.H. 92, 205 A.2d 844 (1964), the New Hampshire Supreme Court held that the purpose of the New Hampshire "long-arm" statute was to extend jurisdiction over a nonresident to the fullest extent permitted under the due process clause of the Fourteenth Amendment. This court has recognized this intent and has applied the "long-arm" statute accordingly. Look v. Hughes Tool Co., 367 F.Supp. 1003 (D. N.H.1973); In Re Tech Consolidated, Inc., 329 F.Supp. 27 (D.N.H.1971); Gill v. Fairchild Hiller Corp., 312 F.Supp. 916 (D.N.H.1970).

Roy v. North American Alliance, supra, holds that there are no mechanical or quantitative rules by which contacts are assessed and jurisdiction determined. Note, Nonresident Jurisdiction and The New England Experience, 48 B.U.Law Rev. 372, 395-402 (1968). The court must judge each case on its own particular facts guided by two important considerations:

First, the exercise of jurisdiction has to be reasonable from the standpoint of New Hampshire's interest in the litigation. Second, it has to be consistent with principles of fair play and substantial justice. Leeper v. Leeper, 114 N.H. 294, 296, 319 A.2d 626, 628 (1974).

Defendant's contacts with New Hampshire are sparse. It has provided thirty-four local travel agencies with promotional brochures and has distributed blank cruise passage contracts to five travel agencies. In addition, defendant has advertised in the Manchester Union Leader, New Hampshire's only statewide newspaper. The amount of revenue which defendant has derived from soliciting in New Hampshire is unascertainable.

Defendant does not have a bank account, telephone number or listing, office, place of business, or any real, tangible, or intangible property located in New Hampshire. Its sole contact with this State arises from its relationship with various local travel agencies.

The first question is whether a travel agency, in obtaining a cruise passage contract for the plaintiff, becomes the agent of the one selling the cruise. If Milford Travel Agency was defendant's agent, then it is constitutionally proper to subject defendant to New Hampshire process. The general rule is that

the sending of agents into the state on a regular basis to solicit business also constitutes doing business (thereby casting doubt on the old rule that mere solicitation was not enough), but if the corporation's business in the state is conducted by independent contractors with only limited power to act on behalf of the corporation, then the corporation probably will not be held to be doing business in the state. Wright and Miller, Federal Practice and Procedure: Civil § 1069 at 252 (1969).

In Stanga v. McCormick Shipping Corporation, 268 F.2d 544 (5th Cir. 1959), the Court held that a nonresident steamship company was not transacting business in Louisiana as a result of a local travel agency booking passenger space and issuing a ticket for the voyage. See also Holt v. Klosters Rederi A/S, 355 F.Supp. 354, n. 5 (W.D.Mich. 1973); Anderson v. Matson Navigation Co., 336 F.Supp. 1388 (D.Minn.1971). The Stanga Court recognized that the travel agency's function was a limited one. "It was more like a broker soliciting patronage from all prospective travelers going anywhere on the globe using transportation facilities of all kinds and of all ownerships." Id. at 551.¹

The record does not disclose, nor could counsel inform the court at the hearing, whether the Rotterdam Cruise was promoted by the travel agency, or whether plaintiff informed the agency that she desired to sail on the S.S. Rotterdam and they were to purchase for her a ticket. In the absence of any evidence that the Milford Travel Agency solicited the plaintiff for the defendant or that it had legal power to bind the defendant, it cannot be found that an agency relationship existed between the defendant and the travel agency.

I must note, however, that with the liberalization of due process criteria, the jurisdictional distinction between agents and independent contractors has begun to fade. Courts treat persons who derive commission revenue, not in terms of agents or independent...