Northern Propane Gas Co. v. Kipps, 15061-PR

• Citation: 622 P.2d 469,127 Ariz. 522
• Decision Date: 04 December 1980
• Docket Number: No. 15061-PR,15061-PR
• Parties: NORTHERN PROPANE GAS COMPANY, a Foreign Corporation, Petitioner, v. The Honorable Gordon S. KIPPS, Court Commissioner and Acting Judge of Pima County Superior Court, Respondent, and Neil P. Isaacson, a single man; Michael R. Strucel, a single man; Thomas Williams and Deborah Williams, husband and wife, Respondents-Real Parties in Interest.
• Court: Supreme Court of Arizona

Page 469

622 P.2d 469

127 Ariz. 522

NORTHERN PROPANE GAS COMPANY, a Foreign Corporation, Petitioner, v. The Honorable Gordon S. KIPPS, Court Commissioner and Acting Judge of Pima County Superior Court, Respondent, and Neil P. Isaacson, a single man; Michael R. Strucel, a single man; Thomas Williams and Deborah Williams, husband and wife, Respondents-Real Parties in Interest.

No. 15061-PR.

Supreme Court of Arizona, In Banc.

Dec. 4, 1980.

Rehearing Denied Jan. 13, 1981.

Lesher, Kimble & Rucker, P. C. by Darwin J. Nelson, Tucson, for petitioner

Molloy, Jones, Donahue, Trachta, Childers & Mallamo, P. C. by John F. Molloy, Tucson, for respondents-real parties in interest.

CAMERON, Justice.

This is a petition for review of a decision and opinion of the Court of Appeals, Division Two, 127 Ariz. ---, 622 P.2d 485, which reversed the judgment of the Pima County Superior Court and ordered the plaintiffs complaint dismissed for lack of personal jurisdiction over the defendant. We have jurisdiction pursuant to A.R.S. § 12-120.24 and Rule 23, Arizona Rules of Civil Appellate Procedure, 17A A.R.S.

The questions we must decide are:

1. Was the petition for special action timely filed in the Court of Appeals?

2. Did the defendant, Northern Propane Gas Company, have sufficient contacts, ties or relations with Arizona to justify the exercise of personal jurisdiction by an Arizona court, consistent with due process?

The pertinent facts are as follows. In January 1978, Neil Isaacson and Michael Strucel, residents of Michigan, planned a trip to Arizona in Isaacson's motor home to visit Thomas and Deborah Williams who lived in Tucson, Arizona.

The propane gas tanks in the motor home were filled at a Northern Propane Gas Company outlet in Michigan by a company employee. According to Strucel, the employee who filled the tank was told that the motor home would be traveling to Arizona. On 14 January 1978, while the vehicle was parked at a camp site in Pima County, Arizona, an explosion occurred in the motor home, resulting in injury to Isaacson, Strucel and Williams.

Northern Propane was incorporated in Delaware and has its principal place of business in Douglas County, Nebraska. The business of the company is the wholesale and retail selling of propane gas and the ownership and operation of gas distribution properties. Northern Propane is not authorized to do business in Arizona, and there are no offices, records, accounts, sales persons, or agents located in Arizona. The company does no selling or distributing in Arizona. No property or assets are owned in this state.

The injured parties filed suit in Pima County Superior Court against Northern Propane Gas Company, alleging that the cause of the explosion and their injuries was negligence in overfilling one of the propane tanks. The trial court denied Northern Propane's motion to dismiss for lack of personal jurisdiction over the defendants. Northern Propane subsequently filed a special action petition in the Arizona Court of Appeals, Division Two. On 1 May 1979, the Court of Appeals declined jurisdiction.

On 9 June 1980, following the decision of the United States Supreme Court in World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980) and the denial of another motion to dismiss in the Pima County Superior Court, Northern Propane filed a second petition for special action challenging the Superior Court's denial of the motion to dismiss in light of the World-Wide decision.

The Court of Appeals accepted the petition for special action and directed the trial court to dismiss the complaint.

TIMELINESS OF THE PETITION FOR SPECIAL ACTION

Initially, we address a procedural point raised by the plaintiffs. The plaintiffs argue that the Court of Appeals should not have accepted the second special action petition of Northern Propane due to the defendant's delay in filing it.

The motion to dismiss was denied by the Superior Court on 25 April 1980. Rule 9(a) of the Arizona Rules of Civil Appellate Procedure, 17A A.R.S., requires a notice of appeal to be filed within 30 days of judgment. Northern Propane filed the petition for special action on 9 June 1980, 45 days after judgment.

A denial of a motion to dismiss is a non-appealable order. Engle Brothers, Inc. v. Superior Court, 23 Ariz.App. 406, 533 P.2d 714 (1975). Therefore, the time limits governing the filing of appeals are not applicable. Rather, the proper procedure for appellate review of a motion to dismiss is through a petition for special action. Deere & Company v. Superior Court for Pima County, 18 Ariz.App. 491, 503 P.2d 967 (1972). There is no specific time limit as to when a petition for special action must be brought, and acceptance of a petition for special action is discretionary with the court. Bilagody v. Thorneycroft, 125 Ariz. 88, 607 P.2d 965 (App.1979). We find no abuse of discretion.

PERSONAL JURISDICTION

Arizona courts are authorized to exercise personal jurisdiction over non-resident defendants under Rule 4(e)(2), Rules of Civil Procedure, 16 A.R.S. The rule states:

"4(e)(2) Summons; personal service out of state. When the defendant is a resident of this state, or is a corporation doing business in this state, or is a person, partnership, corporation or unincorporated association subject to suit in a common name which has caused an event to occur in this state out of which the claim which is the subject of the complaint arose, service may be made as herein provided, and when so made shall be of the same effect as personal service within the state. * * * "

The due process clause of the United States Constitution, however, limits the power of a state to achieve personal jurisdiction over a defendant. Kulko v. Superior Court, 436 U.S. 84, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978); Pennoyer v. Neff, 95 U.S. 714, 24 L.Ed. 565 (1878), overruled on other grounds by Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977). Personal jurisdiction can be exercised only if the defendant has reasonable notice that an action has been brought and if the defendant has sufficient connection with the forum so that it is fair to require the defendant to defend the action in the forum. Kulko v. Superior Court, supra, 436 U.S. at 91, 98 S.Ct. at 1696-1697, 56 L.Ed.2d at 141. One measure of connection with the forum is the contacts which the defendant has maintained with the state in which suit is brought. International Shoe Co. v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945).

In Phillips v. Anchor Hocking Glass Corporation, 100 Ariz. 251, 413 P.2d 732 (1966), we held that at least minimum contacts must be established before we could fairly exercise jurisdiction over a non-resident defendant. See International Shoe Co. v. State of Washington, supra.

What constitutes minimum contacts has recently been discussed by the United States Supreme Court in World-Wide Volkswagen, supra. World-Wide involved a suit in an Oklahoma court by New York plaintiffs against New York defendants for injuries sustained in Oklahoma. The defendants sold an Audi automobile to the plaintiffs; it burned in Oklahoma and caused injury to the plaintiffs. The defendants, who were the local distributor and seller of the Audi in New York, had no contacts with Oklahoma, conducted no business there, made no sales or solicitations within the state, and did not regularly sell to Oklahoma buyers. The only contact relied upon by plaintiffs was "the fortuitous circumstance that a single Audi automobile, sold in New York to New York residents, happened to suffer an accident while passing through Oklahoma." 444 U.S. at 295, 100 S.Ct. at 566, 62 L.Ed.2d at 500.

The plaintiffs in World-Wide, supra, as the plaintiffs herein, argued that the defendant had sufficient contact with Oklahoma because defendant could foresee injury in Oklahoma due to the inherent mobility of the automobile. Noting that under Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958) "foreseeability" alone is not a sufficient "benchmark" for personal jurisdiction, the United States Supreme Court stated:

" * * * (T)he foreseeability that is critical to due process analysis is not the mere likelihood that a product will find its way into the forum State. Rather, it is that the defendant's conduct and connection with the forum State are such that he should reasonably anticipate being haled into court there." 444 U.S. at 297, 100 S.Ct. at 567, 62 L.Ed.2d at 501.

Applying the test to the defendants, the United States Supreme Court found that although it was foreseeable that a purchaser of an automobile might take it into another state, the mere unilateral activity of those who claim some relationship with a non-resident defendant could not satisfy the requirement of contact with the forum state. World-Wide, supra. Relying upon the reasoning in World-Wide, supra, we do not find in the instant case that Northern Propane's "conduct and connection" with the State of Arizona was such that it could reasonably anticipate it would be subject to suit in Arizona.

Plaintiffs also contend that the facts show that Northern Propane engaged in purposeful conduct in Arizona because Northern Propane was informed that the vehicle would be used in Arizona. A defendant's purposeful activity with the forum state can result in personal jurisdiction being obtained against him. Kulko v. Superior Court of California, supra, 436 U.S. at 94, 98 S.Ct. at 1698, 56 L.Ed.2d at 142; Shaffer v. Heitner, supra, 433 U.S. at 216, 97 S.Ct. at 2586, 53 L.Ed.2d at 705; Hanson v....