Rubinstein v. Lucchese, Inc., 02–15–00317–CV

• Decision Date: 07 July 2016
• Docket Number: NO. 02–15–00317–CV,02–15–00317–CV
• Citation: 497 S.W.3d 615
• Parties: Stan Rubinstein, Appellant v. Lucchese, Inc., Appellee
• Court: Texas Court of Appeals

497 S.W.3d 615

Stan Rubinstein¹ , Appellant

v.Lucchese, Inc., Appellee

NO. 02–15–00317–CV

Court of Appeals of Texas, Fort Worth.

DELIVERED: July 7, 2016

Kenneth C. Johnston, Catherine E. (Kate) Gaither; Kane Russell Coleman & Logan PC, Dallas, Texas, for Appellant.

David F. Farris, John R. Lively, Daniel R. Aguilar; Lively & Associates, L.L.P., Fort Worth, Texas, for Appellee.

PANEL: DAUPHINOTand GARDNER, JJ.; and KERRY FITZGERALD (Senior Justice, Retired, Sitting by Assignment).

OPINION

KERRY FITZGERALD, JUSTICE

I. INTRODUCTION

In this accelerated, interlocutory appeal, Appellant Stan Rubinstein challenges the trial court's order denying his special appearance. We affirm.

II. BACKGROUND

This case presents the question of whether the trial court may exercise personal jurisdiction over Rubinstein as an individual nonresident "guarantor." Rubinstein claims he did not execute a guaranty, but even if such a guaranty existed, Rubinstein claims there are not the requisite minimum contacts such that a Texas court can exercise specific jurisdiction over him.

According to the petition, in March of 2003, Rubinstein, a Pennsylvania resident, purchased the Pennsylvania corporation Sterling Leather Enterprises, Inc. and became president. The petition alleged Rubinstein's purposeful acts in contacting Appellee Lucchese, Inc. in Texas, seeking a credit account and asking Lucchese to provide Rubinstein with boots and other western merchandise. The parties exchanged correspondence and financial documents. On July 21, 2005, Lucchese sent Rubinstein a letter as follows:

Stan,Recently during a routine audit, it has been brought to our attention that we do not have a current credit application on file for Sterling Leather Enterprise. In order to continue to process orders without interruption, we must have the attached credit application completed and returned to us. Please make sure everything is filled in on the application, and signatures provided where indicated, including the personal guaranty. If possible, please attach a copy of your most current financial statement.

We are excited that your business is growing and that your sales with LUCCHESE are increasing. We value your business and appreciate your understanding in providing the requested information so that we are in compliance with the LUCCHESE Credit Department Policies and Procedures.

Rubinstein replied in a fax dated July 26, 2005:

I am faxing to you the information forwarded to Mona dated April 4, 2003. This information contained a completed application and a financial statement for March 2003. As you know, I have been buying from Lucchese for years and have always paid my bills promptly. I do not like to complete duplicate guarantees and so I am forwarding an updated financial statement for your records.

Lucchese shipped merchandise from Texas to Rubinstein's offices in Pennsylvania or to the address of Sterling Leather's customers continuously from March 2003 to February 2015. During this time, Rubinstein communicated with Lucchese at its offices in Texas by mail, email, and telephone.

On June 5, 2015, Lucchese sued Sterling Leather and Rubinstein. This suit on a sworn account sought to collect monies Lucchese claimed Sterling Leather and Rubinstein owed Lucchese. Specifically, Lucchese pleaded that Sterling Leather owed Lucchese $208,718.30 for goods that Lucchese had provided to Sterling Leather. Lucchese further pleaded that Rubinstein, as Sterling Leather's personal guarantor, was liable for the debt as well.²

Rubinstein filed his verified special appearance, wherein he stated that he "[did] not have sufficient minimum contacts with Texas under either a general or specific jurisdiction theory to support the assertion of personal jurisdiction over him." Rubinstein asserted that he was a lifelong resident of Pennsylvania and was president of Sterling Leather, a corporation he purchased in March 2003, which did business with Lucchese. However, Rubinstein asserted that he had never been in Texas, done business in Texas, or owned property in Texas. Rubinstein further stated he "ha[d] never represented that he would financially back Sterling Leather" and that Lucchese's claim against him is based on "an alleged guaranty of Sterling Leather's obligations" but that Lucchese "fails to produce any guaranty or agreement."

III. SPECIAL–APPEARANCE HEARING

At the special-appearance hearing, Rubinstein testified that he had never lived in Texas, had never traveled to Texas, and had not conducted business of any kind in Texas. Rubinstein also averred that he had never owned any real or personal property in Texas, nor had he ever maintained bank accounts, assets, nor paid taxes in Texas.

Rubinstein stated that he was the sole owner of his new corporation, Sterling Leather, and wanted it to do business with Lucchese. He, therefore, applied for a credit account, sending a credit application and financial statement of his corporation using his own forms, not Lucchese's forms. Rubinstein said that although he provided his name, date of birth, and social security number to Lucchese, he did not provide his own personal financial information, nor did he personally guarantee Sterling Leather's debts.

Rubinstein averred that two years into the agreement with Lucchese, Lucchese sent the July 21, 2005 letter wherein Lucchese asked Rubinstein to "complete ... their credit application along with a personal guaranty which was part of [the] application." Rubinstein testified that he did not complete either of these documents. Rubinstein acknowledged that, in response to Lucchese's request, he sent a fax which stated in part: "I do not like to complete duplicate guarantees...." When asked what he meant by this, Rubinstein testified, "What I was referring to is that I had already sent a credit application back in 2003, and there was no need for me to resend the credit application that I had originally sent." He specifically denied signing any personal guaranty on behalf of Sterling Leather. Rubinstein said that on occasion he contacted Lucchese by telephone, always in his capacity as president of Sterling Leather and not in his individual capacity.

The affidavit of Lucchese's Senior Credit Manager, Jerardo Chavira, was admitted without objection. The Chavira affidavit read in part:

4. Lucchese is in the business of providing boots and other western wear merchandise and accessories to customers such as Sterling Leather Enterprises, Inc., ("Sterling Leather") which is in the business of selling such merchandise to end consumers.

5. Sterling Leather is a Pennsylvania corporation, and Stan Rubinstein is the owner and president of Sterling Leather.

6. The business relationship between Lucchese, Sterling Leather[,] and Rubinstein began on or around 2003 when Sterling Leather contacted Lucchese in the State of Texas and sought for Lucchese to provide Sterling Leather with merchandise for sale.

....

8. Under the business arrangement between the parties, Lucchese would ship its goods from the State of Texas to Sterling Leather's location in Pennsylvania or from the State of Texas to the address of Sterling Leather's customers designated in the purchase orders. Over the course of the business relationship, Sterling Leather, through Mr. Rubinstein, would contact Lucchese by phone, fax, and other means at the Lucchese office in Texas. Payment under the arrangement would be received by Lucchese at its El Paso office in Texas.

....

11. On or before 2004, Lucchese and Stan Rubinstein entered into a written agreement by which Stan Rubinstein agreed to guaranty Sterling Leather's debts to Lucchese, in consideration for Lucchese extending credit to Sterling Leather. I know this to be true for several reasons stated below.

12. Attached as Exhibit A–2 is a true and correct copy of a 2005 letter from Stan Rubinstein to Lucchese's office in El Paso, Texas, sent by facsimile to the El Paso fax number at (915)778–6796.

13. As shown in Exhibit A–2, Mr. Rubinstein acknowledges his company's long relationship with Lucchese and then states that he does "not like to complete duplicate guarantees," and forwards a financial statement instead—a statement which acknowledges that a guaranty with Lucchese exists.

14. It is Lucchese's standard business practice to obtain a personal guaranty from the owners of corporations (and other limited liability entities) such as Sterling Leather before extending credit to the corporation or entity. Guaranties such as this are a condition of the extension of credit Lucchese requires to protect its financial interests. I have no reason to believe that Lucchese deviated from the practice of obtaining guaranties in its dealings with Sterling Leather and Stan Rubinstein—especially in light of Rubinstein's statements in Exhibit A–2.

15. At this time, Lucchese has been unable to locate a copy of the guaranty agreement and standard credit agreement for Sterling Leather. However, due to the frequency with which Lucchese uses such agreements, the terms are well known to me and include the following: the principal of the company agrees to guarantee the payment of all indebtedness incurred by the subject company in consideration for Lucchese's extension of credit to the company; the extension of credit is conditioned on the parties['] agreeing that the laws and jurisdiction of the State of Texas govern the agreement.

16. Due to Lucchese's standard practice of using such agreements referenced in the paragraph above, along with Mr. Rubinstein's acknowledgement that a guaranty exists, as shown in Exhibit A–2, Mr. Rubinstein entered into a written guaranty to pay Sterling Leather's debts to Lucchese on the terms described in Paragraphs 14 and 15 above.

17. [Explanation for misplacement of document.]

IV. DISCUSSION

Rubinstein argues that the trial court erred by denying his special appearance because (a) there is no evidence of a written guaranty but (b) even if there was a written guaranty, Rubinstein "does not have the...