Nutri-West v. Gibson, NUTRI-WEST

• Court: United States State Supreme Court of Wyoming
• Citation: 764 P.2d 693
• Docket Number: NUTRI-WEST,No. 87-266,87-266
• Parties: , also known as Nutri-West Manufacturing Company, and Nutrition Center, Incorporated, Appellant (Plaintiff), v. Betty G. GIBSON, James E. Gibson, Robert D. Davies and Kathleen N. Davies, individually and doing business as Nutri-West of California, Appellees (Defendants).
• Decision Date: 23 November 1988

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764 P.2d 693 NUTRI-WEST, also known as Nutri-West Manufacturing Company, and Nutrition Center, Incorporated, Appellant (Plaintiff),
v.
Betty G. GIBSON, James E. Gibson, Robert D. Davies and Kathleen N. Davies, individually and doing business as Nutri-West of California, Appellees (Defendants). No. 87-266. Supreme Court of Wyoming. Nov. 23, 1988.

Page 694

J. Patrick Hand of Hand, Hand & Hand, Douglas, for appellant.

Stuart R. Day (argued), of Williams, Porter, Day & Neville, Casper, and Lawrence M. Kahn of Perona, Langer, LaTorraca & Beck, Long Beach, Cal., for appellees.

Before CARDINE, C.J., and THOMAS, URBIGKIT, and MACY, JJ., and BROWN, J., Retired. ^*

CARDINE, Chief Justice.

This case concerns the validity of the so-called "transient jurisdiction" doctrine, which provides that personal service upon a nonresident individual who is temporarily present in a state is a sufficient basis for the exercise of personal jurisdiction over the individual. We conclude that the transient rule is still valid, and we reverse the district court's order dismissing appellant's complaint for lack of personal jurisdiction. Addressing a related issue, we hold that the district court acquired personal jurisdiction over appellees' partnership by personal service upon a partner while present in the state, but not over unserved nonresident partners in their individual capacities.

FACTS

In October or November of 1984, Paul White, manager of appellant Nutri-West, met appellee Betty Gibson at a chiropractor's meeting in Omaha, Nebraska. About a month later, Mr. White called Ms. Gibson in California and asked if she would be interested in an exclusive California distributorship for Nutri-West products. On two occasions, Mr. White flew to California and met with Ms. Gibson, and ultimately Ms. Gibson agreed to the distributorship. Mr. White mailed Ms. Gibson a written distributorship contract which was signed in California by Ms. Gibson, her husband James Gibson, Robert Davies and his wife Kathleen Davies.

The Gibsons and the Davies formed a partnership called Nutri-West of California. As a distributor of appellant's products, Nutri-West of California solicited sales of Nutri-West products in California, ordered the products by telephone or mail from appellant's Douglas, Wyoming office, and sold them in California. As the business relationship progressed, appellant became unhappy with appellees' performance and, in June 1987, filed an action for declaratory judgment and injunction terminating the distributorship agreement. Ms. Gibson came to Douglas, Wyoming to attend a convention sponsored by appellant, where, on June 27, 1987, she was personally served with four copies of the complaint and four summonses naming herself and the other three individual appellees as defendants.

Appellees entered a special appearance to quash service and contest jurisdiction, contending that the service was defective and that the court's exercise of personal jurisdiction over them violated their due process rights under the federal and Wyoming constitutions. After affidavits and briefs were filed, the district court dismissed appellant's complaint because "the defendants [did] not have sufficient contacts with this state to allow a Wyoming court to exercise jurisdiction over them." Appellant Nutri-West appeals from the order of dismissal, contending that the district court erred in applying the minimum contacts test to determine personal jurisdiction over Ms. Gibson, the other individual partners, and the partnership.

JURISDICTION OVER MS. GIBSON

In determining personal jurisdiction, we must first decide whether the service requirements of Rule 4, W.R.C.P., have been met. If Rule 4 is satisfied, we must then determine whether the court's exercise of jurisdiction is consistent with due process. See First Wyoming Bank, N.A., Rawlins v. Trans Mountain Sales & Leasing,

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Inc., Wyo., 602 P.2d 1219 (1979). With respect to Ms. Gibson, there appears to be no deficiency in service of process. Accordingly, we will focus on whether due process considerations precluded the district court from exercising personal jurisdiction over her.

W.S. 5-1-107(a), provides that a "Wyoming court may exercise jurisdiction on any basis not inconsistent with the Wyoming or United States Constitution." This statute extends state court jurisdiction in Wyoming to the constitutionally permissible limit. Shanks v. Westland Equipment and Parts Co., 668 F.2d 1165 (10th Cir.1982). The principal question in this appeal is whether it is constitutionally permissible to predicate personal jurisdiction on temporary physical presence and personal service within the forum state.

The continued vitality of jurisdiction based on physical presence, sometimes called "transient" jurisdiction, has been discussed by many commentators and several courts. While the commentators have been largely critical of the doctrine, ¹ most courts have concluded that it is still valid. ² In urging that transient jurisdiction is no longer constitutionally permissible, appellees rely heavily on the following statement contained in Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 2584, 53 L.Ed.2d 683 (1977):

"[A]ll assertions of state-court jurisdiction must be evaluated according to the standards set forth in International Shoe [326 U.S. 310,...