Puget Sound Bulb Exchange v. Metal Buildings Insulation Inc.

• Decision Date: 12 July 1973
• Docket Number: No. 774--II,774--II
• Citation: 513 P.2d 102,9 Wn.App. 284
• Parties: PUGET SOUND BULB EXCHANGE, a marketing corporation, Plaintiff, v. METAL BUILDINGS INSULATION INC., a corporation, Appellant, Perrot Kaufman Steel Building Company, Inc., a corporation, et al., Defendants, and Hamilton Manufacturing Company, Respondent and Cross-appellant.
• Court: Washington Court of Appeals

Page 284

9 Wn.App. 284

513 P.2d 102

PUGET SOUND BULB EXCHANGE, a marketing corporation, Plaintiff, v. METAL BUILDINGS INSULATION INC., a corporation, Appellant Perrot Kaufman Steel Building Company, Inc., a corporation et al., Defendants and Hamilton Manufacturing Company, Respondent and Cross-appellant.

No. 774--II.

Court of Appeals of Washington, Division 2.

July 12, 1973.

Review Denied Oct. 9, 1973.

William R. Hickman and Roy J. Moceri of Reed, McClure, Moceri & Thonn, Seattle, for appellant.

Harold E. Winther of Combs & Small, Tacoma, for respondent.

ARMSTRONG, Judge.

Metal Buildings Insulation, Inc., has appealed from a judgment entered against it in a suit alleging defective installation of insulation. The appeal attacks an order dismissing Hamilton Manufacturing Company, a third party defendant and the manufacturer of the allegedly defective insulation.

One of the defendants, not a party to this appeal, constructed a building for the plaintiff, Pudget Sound Bulb Exchange. Metal Buildings supplied the insulation. The roof leaked almost immediately and plaintiff brought suit contending that the insulation was defective, resulting in water damage to its inventory.

The suit was tried to the court and it found that the insulation supplied by Metal Buildings was defective, that the plaintiff-owner of the building had not anticipated the use of a defective product and that the defective insulation should not have been recommended or supplied by any of the defendants. Accordingly, the court granted the plaintiff judgment for $96,062.30 damages caused by the defective insulation plus costs against all four defendants. The judgment also required Metal Buildings to indemnify the other three defendants. Metal Buildings has satisfied that judgment and is the sole appellant.

Before trial, Metal Buildings filed a third party complaint against Hamilton Manufacturing Company, the manufacturer of the allegedly defective insulation. Hamilton is a Virginia corporation not authorized to transact business in this state. Hamilton moved to dismiss the third party complaint for lack of personal jurisdiction over it. The court held a hearing on the motion and dismissed the third party complaint without prejudice. Metal Buildings did not appeal within 30 days from this order. It has appealed from the final judgment in the suit and specifically complains, in its notice of appeal, of the order dismissing Hamilton.

The issues we must decide are: (1) does an appeal from the final judgment in the suit bring up for review the order dismissing the third party complaint, and, if so, (2) did the trial court properly dismiss the third party complaint for lack of in personam jurisdiction over Hamilton? We hold that the order of dismissal is properly before us and that the trial court erred in granting the dismissal.

Hamilton raises the first issue pursuant to CAROA 51 which allows a respondent to move to dismiss an appeal on any of several grounds. Hamilton contends that the failure of Metal Buildings to appeal within 30 days from the order of dismissal deprives this court of jurisdiction to consider the propriety of that order. We disagree.

The order dismissing Hamilton was entered on March 2, 1972. The final judgment in the suit was entered on April 7, 1972. Within 30 days of the final judgment, on May 3, 1972, Metal Buildings filed its notice of appeal.

CAROA 14 describes which judgments and orders are appealable. Subdivision (1) provides that the final judgment in any action or proceeding is appealable and that 'An appeal from any such final judgment shall also bring up for review any order made in the same action or proceeding either before or after the judgment.'

Hamilton contends that the order of dismissal was a final judgment because it determines with finality the rights of the parties to the third party complaint. Hamilton argues that CAROA 14(1) does not contemplate untimely review of such a final order, even if it was merely a part of the entire suit, because it effectively precluded further dispute on the merits respecting the affected parties. We cannot agree with this analysis because, in our view, the order of dismissal did not preclude further dispute on the merits.

The order dismissing Hamilton stated in relevant part:

ORDERED, ADJUDGED AND DECREED that the third party complaint filed by Metal Buildings Insulation, Inc., against third party defendant, Hamilton Manufacturing Company, be dismissed without prejudice as this court lacks jurisdiction over the person of Hamilton Manufacturing Company.

CR 54(b) describes which orders or judgments shall be final when the suit involves multiple claims or multiple parties. It provides:

When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties Only upon an express determination in the judgment, that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.

(Italics ours.)

The order dismissing Hamilton did not contain an express determination that 'there is no just reason for delay' or an express direction for the entry of judgment. It was, therefore, subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties. It was not a final judgment and could not be appealed at that time. The order must be one which is brought up for review by an appeal from the final judgment. CAROA 14(1); Cf. Oliver v. American Motors Corp., 70 Wash.2d 875, 425 P.2d 647 (1967).

Before proceeding to the merits of the dismissal we must discuss two minor issues. First, Hamilton, as a third party defendant, is treated the same as any other nonresident defendant for purposes of RCW 4.28.185. In Deutsch v. West Coast Machinery Co., 80 Wash.2d 707, 497 P.2d 1311 (1972), the court held that our long arm statute does not discriminate between first and third party actions.

Second, in reviewing the propriety of this dismissal, we must view the facts in the light most favorable to the nonmoving party. CR 12(b), which authorizes a motion to dismiss for lack of jurisdiction over the person, does not specifically allow the trial court to consider matters outside the pleadings. ¹ However, the purpose of the rules would be largely frustrated if the parties could not introduce matters outside the pleadings on such a motion. See 3A L. Orland, Wash.Prac., comment 2 at 16 (2d ed. 1968). CR 12(b) is identical to Fed.R.Civ.P. 12(b), 28 U.S.C.A. The portion of the rule which allows the parties to introduce extraneous matters in a motion to dismiss pursuant to CR 12(b)(6) is a 1946 amendment to Fed.R.Civ.P. 12(b), 28 U.S.C.A. Professor Moore, in his treatise on federal practice, states that the reason this particular amendment did not specifically include the authority to introduce extraneous matters in motions to dismiss on the grounds specified in Rule 12(b)(1--5) and (7) is that there never was any substantial doubt that the parties could introduce extraneous matters in these motions. 2A J. Moore, Federal Practice, § 12.09(3), 2297 (1972).

If matters outside the pleadings are presented to the court on a motion to dismiss for lack of personal jurisdiction under CR 12(b)(2) the motion is to be treated as a motion for summary judgment. Moore, Federal Practice, Supra, at 2302; See, e.q. Ace Novelty Co. v. M. W. Kasch Co., 82 Wash.2d 145, 508 P.2d 1365 (1973); Ryland v. Universal Oil Co., 8 Wash.App. 43, 504 P.2d 1171 (1972). Because matters outside the pleadings were presented and not excluded by the trial court in this case, we will treat the motion as one for summary judgment under CR 56. Accordingly, viewing the materials presented in the light most favorable to the nonmoving party, we will affirm the trial court only if it appears that Metal Buildings would not have been able to present a genuine issue of material fact before the trier of fact. Preston v. Duncan, 55 Wash.2d 678, 349 P.2d 605 (1960).

We proceed now to the merits of the dismissal. Metal Buildings contends that the state of Washington may assert personal jurisdiction over Hamilton, a Virginia corporation, pursuant to RCW 4.28.185, ² our long arm statute. Metal Buildings further contends that imposition of personal jurisdiction over Hamilton will not offend 'traditional notions of fair play and substantial justice.' International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95, 161 A.L.R. 1057 (1945). We agree.

In Ace Novelty Co. v. M. W. Kasch Co., Supra, 82 Wash.2d at 147, 508 P.2d at 1367 our Supreme Court reiterated its long standing rule announced in Tyee Constr. Co. v. Dulien Steel Products, Inc., 62 Wash.2d 106, 115, 381 P.2d 245 (1963):

(T)here are three basic factors which must coincide if jurisdiction is to be entertained. Such would appear to be: (1) The nonresident defendant or foreign corporation must purposefully do some act or consummate some transaction in the forum state; (2) the cause of action must arise from, or be connected with, such act or transaction; and (3) the assumption of jurisdiction by the forum state must not offend traditional notions of fair play and substantial justice, consideration being given to the quality, nature, and extent of the activity in the forum state, the relative convenience of ...