Precision Erecting, Inc. v. M & I Marshall & Ilsley Bank, K-9

Citation224 Wis.2d 288,592 N.W.2d 5
Decision Date16 December 1998
Docket NumberNo. 97-3029,K-9,97-3029
PartiesPRECISION ERECTING, INC., Plaintiff, v. M & I MARSHALL & ILSLEY BANK, G.A.P., Inc., Central Acoustical Supply House and Verhalen, Inc., Defendants. AFW Foundry, Inc., Defendant-Third-Party Plaintiff-Respondent, v. Nambe Mills, Inc., Third-Party Defendant-Appellant, d Circle Electric, Inc., Schmitz Ready Mix, Inc., Lippert Tile Company, Inc., RBA, Inc., Cedarburg Lumber Company, August H. Wulf Company, Inc., Waste Management, Inc., A & R Door Service, Inc., AATFAB Corporation, d/b/a Carpenter Technology Communications & Security, AmericanServices, Inc., Bonafide Doors & Hardware, Inc., JBD Enterprises, Labor Ready, Inc., Antonic & Associates, Ltd., and AGT Corporation, Third-Party Defendants.
CourtCourt of Appeals of Wisconsin

On behalf of the third-party defendant-appellant, the cause was submitted on the briefs of Joseph J. Ferris and Larry M. Gille of Kasdorf, Lewis & Swietlik, S.C. of Green Bay.

On behalf of the defendant-third-party plaintiff-respondent, the cause was submitted on the brief of Thad W. Jelinske, and Donald A. Allen, of Domnitz, Mawicke, Goisman & Rosenberg, S.C. of Milwaukee.

Before SNYDER, P.J., BROWN and NETTESHEIM, JJ.

BROWN, J.

At its core, this case examines the responsibilities of a litigant in a multiparty suit to closely examine any exposure it might have whenever one of the other parties files a motion for summary judgment against another party but not against the litigant. We observe it to be self-evident that a summary judgment motion by its very nature alleges certain facts to be undisputed. If a litigant who is not the subject of the motion for summary judgment nonetheless has reason to dispute the facts supporting the motion, it is that litigant's duty to appear and object to the motion. If not, and summary judgment is granted, the facts underlying that judgment are binding on all other parties to the suit as a matter of issue preclusion. That is what the trial court held and we agree.

AFW Foundry, Inc. (AFW), undertook a project to improve its business property in Waukesha, Wisconsin. It hired Jeffrey Antonic, of Antonic & Associates, Ltd. (Antonic), to coordinate the improvement project. AFW and Antonic signed a Finalized Project Agreement listing the projects which Antonic was to supervise. Among them was a "sand system upgrade," including a mixer/muller used for mixing sand. 1 Antonic went to Nambe Mills, Inc. (Nambe), in New Mexico and bought the muller. He paid Nambe $7000 down on the purchase price of $70,000. The muller was delivered to AFW in Waukesha.

When Nambe did not receive the balance due, it filed suit in New Mexico against AFW and Antonic for breach of the contract to purchase the muller. Nambe's position was that Antonic had acted as AFW's agent when he purchased the muller, making AFW responsible for the $63,000 balance due. Meanwhile, in Waukesha county, Precision Erecting, Inc., a subcontractor on the AFW improvement project, filed suit against AFW for its unpaid bills. In response, AFW filed a third-party complaint against Nambe and twenty-two other third-party defendants, including Antonic. It is this third-party suit that is the subject of the present appeal.

AFW's complaint claimed that Antonic was not its agent, but rather the general contractor for the project. Therefore, AFW alleged that its liability was limited to the balance due to Antonic under the contract. The balance allegedly remaining to be paid under the contract was $135,237.25. Further, AFW claimed that since some of the subcontractors and suppliers had already agreed to a pro rata payment, the resulting amount actually due to Antonic on the contract was $86,317.76. AFW denied that it owed the $365,000 claimed by the various subcontractors and suppliers. Nambe filed an answer, alleging, inter alia, that Antonic was an agent of AFW, not a general contractor. Antonic also filed an answer denying that the agreement was a "general contractor's agreement" and affirmatively alleging that he acted exclusively as project manager, not as general contractor.

AFW eventually moved for summary judgment against Antonic and others and requested that the court enter judgment establishing its liability to the various third-party defendants. The motion requested that the court "grant entry of summary judgment in this action in accordance with the demand of the complaint filed herein " and for a finding that the balance due under the agreement was $85,957.35. Antonic submitted a letter to the court indicating that he did not oppose the motion. While Nambe was noticed about the motion, it did not appear or in any way participate in the motion for summary judgment.

The circuit court granted summary judgment. The conclusions of law by the court established that: the agreement between Antonic and AFW was for general contracting services, AFW was only liable for the remaining balance under the general contract and the court's conclusions were binding on all parties to the litigation. Pursuant to the judgment, the amount of $85,957.35 was placed in trust to be distributed to all the subcontractors and suppliers who had not already settled. The court later ordered judgment against AFW, in favor of Nambe, for $11,340. This represented eighteen percent of Nambe's claim. Nambe appeals from this judgment, claiming it did not have adequate notice to oppose AFW's summary judgment motion, that the court lacked personal jurisdiction over Nambe and that the court should have stayed proceedings in Wisconsin due to the ongoing proceedings in New Mexico. 2

As a threshold question, we address whether the trial court had personal jurisdiction over Nambe. Nambe is a New Mexico corporation. The trial court found jurisdiction pursuant to Wisconsin's long-arm statute, § 801.05, STATS. Furthermore, it found that Nambe had sufficient minimum contacts with the state of Wisconsin to satisfy jurisdictional due process requirements. Nambe claims that this was error--that Nambe's "contacts with Wisconsin are too small and too strained to require Nambe to defend a claim in Wisconsin."

Whether a Wisconsin court has personal jurisdiction over a nonresident defendant is a question of law we review de novo. See Marsh v. Farm Bureau Mut. Ins. Co., 179 Wis.2d 42, 52, 505 N.W.2d 162, 165 (Ct.App.1993). The determination involves a two-step inquiry. See id. First, do the defendant's contacts with Wisconsin subject him or her to jurisdiction under Wisconsin's long-arm statute, § 801.05, STATS.? See Marsh, 179 Wis.2d at 52, 505 N.W.2d at 165. Second, does the exercise of jurisdiction conform with due process requirements? See id.

We construe Wisconsin's long-arm statute liberally in favor of finding jurisdiction. See id. Here, the trial court found personal jurisdiction based on § 801.05(5)(c), STATS., which grants a Wisconsin court jurisdiction over any action which "[a]rises out of a promise, made anywhere to the plaintiff or to some 3rd party for the plaintiff's benefit, by the defendant to deliver ... within this state ... goods ... or other things of value." We agree with the trial court that this paragraph gives the Waukesha County Circuit Court jurisdiction over Nambe. It promised to and did deliver the muller to AFW in Waukesha, Wisconsin.

A state's exercise of jurisdiction under its long-arm statute must comport with due process requirements. See Brown v. LaChance, 165 Wis.2d 52, 67, 477 N.W.2d 296, 303 (Ct.App.1991). The due process clause permits a state to exercise jurisdiction over a nonresident defendant as long as the defendant has minimum contacts with the forum state such that "the exercise of jurisdiction does not violate traditional notions of fair play and substantial justice." Marsh, 179 Wis.2d at 53, 505 N.W.2d at 166 (citing International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945)). A defendant corporation establishes minimum contacts by purposely availing itself of the privilege of conducting business in the forum state. See id. The defendant's activities must be such that it could reasonably anticipate being subject to suit in the forum state. See id. at 54, 505 N.W.2d at 166. Finally, the cause of action may be unrelated to the foreign corporation's activities in the state. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984). The state may exercise general jurisdiction over a nonresident defendant based on contacts with the forum state unassociated with the claim, provided those contacts are sufficient to justify jurisdiction. See id. at 414 & n. 9, 104 S.Ct. 1868.

Once the court has decided that minimum contacts exist with the forum state, other factors may be considered in determining whether the assertion of personal jurisdiction over the nonresident defendant comports with "fair play and substantial justice." See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). The emphasis in this inquiry is on reasonableness. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). Factors to be considered include: (1) "the burden on the defendant" in having to defend in a distant forum, (2) "the forum State's interest in adjudicating the dispute," (3) "the plaintiff's interest in obtaining convenient and effective relief," (4) "the interstate judicial system's interest in obtaining the most efficient resolution of controversies" and (5) "the shared interest of the several States in furthering fundamental substantive social policies." Id. This analysis must be made with a flexible, rather than quantitative, approach. See International Shoe, 326 U.S. at 319, 66 S.Ct. 154.

We hold that Nambe has minimum contacts with Wisconsin and that the exercise of jurisdiction over Nambe does not offend...

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