Murphy v. Keenan

• Decision Date: 20 November 1995
• Docket Number: No. 7458,Docket No. Y,7458
• Citation: 667 A.2d 591
• Parties: Alden H. MURPHY v. J. Kevin KEENAN and Reginald Monroe d/b/a Captain's Choice. DecisionLawor-94-893.
• Court: Maine Supreme Court

Page 591

667 A.2d 591

Alden H. MURPHY v. J. Kevin KEENAN and Reginald Monroe d/b/a Captain's Choice.

Decision No. 7458.

Law Docket No. Yor-94-893.

Supreme Judicial Court of Maine.

Submitted on Briefs Sept. 7, 1995.

Decided Nov. 20, 1995.

F. Jay Meyer, Thompson, McNaboe, Ashley & Bull, Portland, for plaintiff.

J. Kevin Keenan, Captain's Choice, Meridith, NH, pro se.

Before WATHEN, C.J., and ROBERTS, GLASSMAN, CLIFFORD, RUDMAN, DANA and LIPEZ, JJ.

CLIFFORD, Justice.

Alden Murphy appeals from the judgment entered in the Superior Court (York County, Perkins, A.R.J.) dismissing his complaint against J. Kevin Keenan and Reginald Monroe, doing business as Captain's Choice, on the ground that the court lacked personal jurisdiction over the defendants. Unpersuaded by Murphy's contentions that there is jurisdiction over the defendants pursuant to 14 M.R.S.A. § 704-A (1980), we affirm the judgment.

In 1992, Murphy, a resident of Hollis Center, purchased a 1990 motorboat at Captain's Choice, a New Hampshire boat dealership. The boat was shown to Murphy by the defendants' representative, Brian Bushman, at their place of business in Meredith, New Hampshire. Meredith is approximately twenty-five miles from the Maine border. Bushman conducted all the negotiations with Murphy regarding the purchase of the boat. A bill of sale was prepared by the defendants and signed by Murphy, Bushman, and Rose M. Pike. It includes Murphy's address in Hollis, and identifies Pike, of Meredith, as the seller. The bill of sale provides that the seller warrants good title to the boat, that the boat is free of liens, and that the seller will defend and hold the buyer harmless from any adverse claims. Murphy paid for the boat with a York County Teacher's Credit Union check listing his Maine address and made payable to Captain's Choice. All activities relating to the sale of the boat, including payment and delivery, took place in New Hampshire.

When Murphy purchased the boat, he was unaware that it was subject to a security interest granted by Pike to New Dartmouth Bank. In late 1993, a representative of a repossession company unsuccessfully sought to repossess the boat from Murphy's yard. In order to remove the lien and clear the title to the boat, Murphy paid $2,394.55 to New Dartmouth Bank. ¹

On May 31, 1994, Murphy filed a complaint against the defendants in the Superior Court seeking to recover damages arising from the lien on the boat. The defendants filed a motion to dismiss based on lack of personal jurisdiction. Following a hearing, the court dismissed the complaint pursuant to M.R.Civ.P. 12(b)(2). Murphy contends that the Superior Court has personal jurisdiction over the defendants and therefore erred in dismissing his complaint.

Maine's jurisdiction over nonresident defendants is controlled by its long-arm statute, 14 M.R.S.A. § 704-A, ² as well as the due process clause of Maine's Constitution, Me. Const. art I, § 6-A. Maine's jurisdictional reach is coextensive with the due process clause of the United States Constitution, U.S. Const. amend. XIV, § 1. Interstate Food Processing Corp. v. Pellerito Foods, Inc., 622 A.2d 1189, 1191 (Me.1993); Frazier v. Bankamerica Int'l, 593 A.2d 661, 662 (Me.1991); Caluri v. Rypkema, 570 A.2d 830, 831 (Me), cert. denied, 498 U.S. 818, 111 S.Ct. 62, 112 L.Ed.2d 37 (1990); Tyson v. Whitaker & Son, Inc., 407 A.2d 1, 2-3 (Me.1979). In order for Maine to exercise personal jurisdiction over a nonresident defendant, due process requires that (1) Maine have a legitimate interest in the subject matter of this litigation; (2) the defendant, by his conduct, reasonably could have anticipated litigation in Maine; and (3) the exercise of jurisdiction by Maine's courts comports with traditional notions of fair play and substantial justice. Interstate Food Processing Corp., 622 A.2d at 1191; Frazier, 593 A.2d at 662); Harriman v. Demoulas Supermarkets, Inc., 518 A.2d 1035, 1036 (Me.1986), cert. denied, 481 U.S. 1048, 107 S.Ct. 2178, 95 L.Ed.2d 835 (1987); Foreside Common Dev. Corp. v Bleisch, 463 A.2d 767, 769 (Me.1983). It is the plaintiff's burden to satisfy the first two prongs of this test. Once the plaintiff does so, the burden then shifts to the defendant to establish that asserting jurisdiction does not comport with traditional notions of fair play and substantial justice. Interstate Food Processing Corp., 622 A.2d at 1191; Caluri, 570 A.2d at 831; Frazier, 593 A.2d at 662. The plaintiff's evidence "must be based on specific facts set forth in the record and the record is to be construed in a light most favorable to the plaintiff." Frazier, 593 A.2d at 662 (citing Caluri, 570 A.2d at 831-32).

Murphy argues that the trial court erred because he has met his burden and that the defendants have failed to establish that Maine's asserting jurisdiction does not comport with traditional notions of fair play and substantial justice. We disagree. The only state interest that Murphy asserts is providing a Maine resident with a forum for redress against a nonresident. Although Maine has an interest in providing its citizens with a means of redress against nonresidents, Interstate Food Processing Corp., 622 A.2d at 1192; Harriman, 518 A.2d at 1036 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 473, 105 S.Ct. 2174, 2182, 85 L.Ed.2d 528 (1985)), an interest beyond mere citizenry is necessary, such as the protection of its industries, the safety of its workers, or the location of witnesses and creditors within its border. See, e.g., Interstate Food Processing Corp., 622 A.2d at 1192; Frazier, 593 A.2d at 663; Harriman, 518 A.2d at 1036-37.

The second prong of the analysis requires an assessment of the contacts between the defendants and Maine. Due process demands that the defendant have sufficient contact with Maine to "make it reasonable ... to require the [defendant] to defend the particular suit which is brought [here]." Interstate Food Processing Corp., 622 A.2d at 1192 (quoting International Shoe Co. v. Washington, 326 U.S. 310, 317, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945)). Contacts that result solely from "the unilateral activity of another party" do not satisfy the minimum contacts requirement. Id. (quoting Heliocopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 417, 104 S.Ct. 1868, 1873, 80 L.Ed.2d 404 (1984)). Rather, the defendant must "purposefully avail itself of 'the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Id. (quoting Burger King Corp., 471 U.S. at 474-75, 105 S.Ct. at 2183). This is achieved when a defendant "purposefully directs his activities" at Maine residents or creates "continuing obligations between himself and the residents [of Maine]." Id. Murphy contends that the minimum contacts requirement is met because the warranty included in the bill of sale establishes a continuing contractual obligation to him.

In Burger King Corp., the United States Supreme Court clarified the extent to which a contract can constitute a contact for due process analysis:

If the question is whether an individual's contract with an out-of-state party alone can automatically establish sufficient minimum contacts in the other party's home forum, we believe the answer clearly is that it cannot.... [W]e have emphasized the need for a "highly realistic" approach that recognizes that a "contract" is "ordinarily but an intermediate step serving to tie up prior business negotiations with future consequences which themselves are the real object of the business transaction." It is these factors--prior negotiations and contemplated future consequences, along with the terms of the contract and the parties' actual course of dealing--that must be evaluated in determining whether the defendant purposefully established minimum contacts with the forum.

471 U.S. at 478-79, 105 S.Ct. at 2185 (emphasis in original) (citations omitted).

It is not disputed that in the present case, all business transactions concerning the sale of the boat were conducted in New Hampshire, and that the sale was a single, isolated event between the parties. Murphy's contact with the defendants was not initiated by the defendants. There was no communication between the parties after the sale until the attempted repossession occurred. Nor was the bill of sale a contract to do business in the future.

The only provision of the bill of sale that contemplated a future relationship between the parties is the warranty provision. ³ Murphy argues that this provision created a continuing contractual obligation that establishes Maine's jurisdiction over the defendants. We disagree. A continuing contractual obligation necessary to support the exercise of jurisdiction requires ongoing contact between the parties with the expectation of conducting future business. See Interstate Food Processing Corp., 622 A.2d at 1192; Christiansen v. Smith, 598 A.2d 176, 178 (Me.1991); Electronic Media Int'l v. Pioneer Communications of Am., Inc., 586 A.2d 1256, 1259-60 (Me.1991); Caluri, 570 A.2d at 832; Harriman, 518 A.2d at 1037. A warranty is not of the same nature as continuing contacts for business purposes and does not establish a continuing contractual obligation. Indeed, pursuant to the Uniform Commercial Code,...