Security Crdit Leasing v. Armaly

Citation529 S.E.2d 64
Decision Date06 March 2000
Docket Number3129
PartiesSecurity Credit Leasing, Inc., a Florida Corporation, Respondent, v. Abed N. Armaly, individually and d/b/a Famous Pizza Restaurant, Appellant. OpinionTHE STATE OF SOUTH CAROLINA In The Court of Appeals Heard
CourtCourt of Appeals of South Carolina

Appeal From Greenville County Joseph J. Watson, Circuit Court Judge

Bradford N. Martin, of Leatherwood, Walker, Todd & Mann, of Greenville, for Appellant.

Helen E. Burris, of Nexsen, Pruet, Jacobs & Pollard, of Greenville, for Respondent.

AFFIRMED

HOWARD, J.:

Abed N. Armaly appeals the enforcement in South Carolina of a Florida default judgment based on the foreign court's lack of personal jurisdiction. We affirm.

FACTUAL/PROCEDURAL BACKGROUND

Armaly owns a restaurant in Spartanburg, South Carolina. A representative of Security Credit Leasing, Inc., a Florida corporation, approached Armaly at his restaurant in December of 1996 to solicit business. Armaly entered into a four-year lease with Security Credit for video surveillance equipment. The two-page lease contains an "Applicable Law and Venue" clause which provides:

You agree that you are applying to and arranging this Lease with us in accordance with the Laws of the State of Florida. You agree to submit yourself and any and all guarantors of this Lease to the subject matter jurisdiction of the Courts of the State of Florida in the event it is necessary to seek enforcement in a court of law due to any breach. You also agree that venue and personal jurisdiction shall be proper solely in Hillsborough County, Florida where we are headquartered.

Soon after installation of the surveillance system, Armaly requested that Security Credit remove the equipment. Armaly contended he was promised surveillance twenty-four hours a day, but instead received surveillance only ten hours a day. Security Credit removed the equipment per Armaly's request.

Security Credit then brought an action for breach of the lease in Hillsborough County, Florida. A $9,125.19 default judgment in favor of Security Credit was entered on March 2, 1998. The Florida court ruled it had "subject matter jurisdiction of [the] cause and personal jurisdiction of the parties hereto."

Security Credit thereafter filed this action in South Carolina on May 11, 1998 to enforce the Florida judgment. Armaly moved to dismiss on the ground the Florida court lacked personal jurisdiction over him. The trial court denied the motion to dismiss and entered judgment in favor of Security Credit.

STANDARD OF REVIEW

An action to enforce a foreign judgment is an action at law. See Carson v. Vance, 326 S.C. 543, 485 S.E.2d 126 (Ct. App. 1997). In an action at law, tried by a judge without a jury, the findings of the trial court must be affirmed if there is any evidence to support them. Townes Assocs., Ltd. v. City of Greenville, 266 S.C. 81, 221 S.E.2d 773 (1976). Cf. Clark v. Key, 304 S.C. 497, 405 S.E.2d 599 (1991) (finding the appellate court is bound by the trial court's determination that a non-resident defendant is subject to jurisdiction, unless no evidence exists to support the finding).

LAW/ANALYSIS

Armaly first alleges on appeal that Security Credit could not maintain the proceeding in the lower court to enforce the foreign judgment because Security Credit was a foreign corporation transacting business in this state without a certificate of authority. However, no evidence was presented before the lower court to support this allegation. We find this issue was not properly and fairly raised before the lower court and decline to address it on appeal. See Strother v. Lexington County Recreation Comm'n, 332 S.C. 54, 504 S.E.2d 117 (1998).

Armaly next contends the "Applicable Law and Venue" clause contained in the lease was unreasonable and unjust. However, consent to jurisdiction clauses are generally presumed valid and enforceable when made at arm's length by sophisticated business entities. M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 92 S. Ct. 1907 (1972). Armaly merely alleged in his motion to dismiss and supporting affidavit that he did not read the lease provisions. He had an opportunity to read the lease agreement and discover its contents, and is charged with notice of the content of the contract he signed. See Moye v. Wilson Motors, Inc., 254 S.C. 471, 176 S.E.2d 147 (1970). Armaly offered no compelling evidence to support his allegations. Therefore, we find this argument to be without merit.

Armaly's primary contention is that the lower court erred in enforcing the Florida judgment against him in South Carolina and denying his motion to dismiss because the Florida court did not properly exercise personal jurisdiction over him.

The Full Faith and Credit Clause provides: "Full Faith and Credit shall be given in each state to the . . . judicial proceedings of every other State." U.S. Const. Art. IV, 1. Thus, in accordance with this mandate, the courts of one state must give such force and effect to a foreign judgment as the judgment would receive in the state where rendered. Hamilton v. Patterson, 236 S.C. 487, 115 S.E.2d 68 (1960); Carson v. Vance, 326 S.C. 543, 485 S.E.2d 126 (Ct. App. 1997); Bankers Trust Co. v. Braten, 317 S.C. 547, 455 S.E.2d 199 (Ct. App. 1995).

Where a judgment is rendered by a court with jurisdiction of the case and the parties, "'the full faith and credit clause of the Constitution precludes any inquiry into the merits of the cause of action, the logic or consistency of the decision, or the validity of the legal principles on which the judgment is based.'" Hamilton, 236 S.C. at 492, 115 S.E.2d at 70 (quoting Milliken v. Meyer, 311 U.S. 457, 462 (1940)). However, "[t]he Full Faith and Credit Clause does not prevent the litigation of personal jurisdiction in an action to enforce a foreign judgment." Colonial Pac. Leasing Corp. v. Taylor, 326 S.C. 529, 532, 484 S.E.2d 595, 596-97 (Ct. App. 1997). See also Alladin Plastics, Inc. v. Wintenna, Inc., 301 S.C. 90, 390 S.E.2d 370 (Ct. App. 1990). Further, "judgments obtained in violation of procedural due process are not entitled to full faith and credit when sued upon in another jurisdiction." Purdie v. Smalls, 293 S.C. 216, 220, 359 S.E.2d 306, 308 (Ct. App. 1987) (citing Griffin v. Griffin, 327 U.S. 220 (1946)).

Armaly, by challenging the enforcement of the foreign judgment on the ground of lack of personal jurisdiction, assumed the burden of proof. See Espinal v. Blackmon, 298 S.C. 544, 381 S.E.2d 921 (Ct. App. 1989). Our supreme court has recognized:

A judgment presumes jurisdiction over the subject matter and over the persons. . . [and] "[i]f it appears on its face to be a record of a court of general jurisdiction, such jurisdiction over the cause and the parties is to be presumed unless disproved by extrinsic evidence, or by the record itself."

Taylor v. Taylor, 229 S.C. 92, 97, 91 S.E.2d 876, 879 (1956) (quoting with approval Cook v. Cook, 342 U.S. 126,128 (1951) (citations omitted)).

The Florida judgment appears regular on its face so jurisdiction must be presumed unless Armaly, from the record or by extrinsic evidence, overcomes that presumption. In the motion to dismiss, Armaly alleged: "[He] did not have minimum contacts with the state of Florida to provide an independent basis for jurisdiction."

In support of the motion, he submitted an affidavit stating in pertinent part:

9. This transaction was the first and only time I have dealt with Security Credit Leasing, Inc. I have never gone to Florida in connection with my dealings with Security Credit Leasing, Inc. and have never visited their place of business.

10. Security Credit Leasing, Inc. initiated the contact with me and installed their equipment in South Carolina.

11. All business transactions between myself and Security Credit Leasing, Inc. have taken place in South Carolina and I did not purposefully avail myself of the privileges and benefits of doing business in Florida.

We find Armaly sufficiently carried the burden of proof to overcome the presumption of jurisdiction from a judgment that appears valid on its face. Hence, the question of personal jurisdiction was properly raised before the lower court.

Armaly argues on appeal the lower court erred in applying Republic Leasing Co., Inc.v. Haywood, 329 S.C. 562, 495 S.E.2d 804 (Ct. App. 1998), opinion vacated, 335 S.C. 207, 516 S.E.2d 441 (1999), to decide upon the question of personal jurisdiction. In Republic Leasing, this court upheld the imposition of personal jurisdiction over a nonresident defendant in a court of this state solely on the basis of a personal jurisdiction clause contained in a contract, where the contract was entered into at arm's length by sophisticated business entities. Armaly maintains Florida law, rather than South Carolina law must be applied to determine whether the Florida court properly maintained personal jurisdiction.1 We agree. "The validity and effect of a foreign judgment must be determined by the laws of the state that rendered the judgment." Loyd & Ring's Wholesale Nursery, Inc. v. Long & Woodley Landscaping & Garden Ctr., Inc., 315 S.C. 88, 91, 431 S.E.2d 632, 634 (Ct. App. 1993). See also Hamilton, 115 S.E.2d 68, 236 S.C. 487; Carson, 326 S.C. 543, 485 S.E.2d 126; Purdie, 293 S.C. 216, 359 S.E.2d 306.

Under Florida law, two requirements must be met for a Florida court to obtain personal jurisdiction over an out-of-state defendant: (1) the plaintiff must allege sufficient jurisdictional facts in the complaint to bring the action within the Florida long-arm statute, Fla. Stat. Ann. 48.193 (Supp. 1999), and (2) the defendant must have sufficient minimum contacts with the state to satisfy the Fourteenth Amendment's due process requirements. Doe v. Thompson, 620 So. 2d 1004 (Fla. 1993); Venetian Salami Co. v. Parthenais, 554 So. 2d 499 (Fla. 1989); Belz Investco Ltd. Partnership v. Groupo Immobiliano Cababie, 721 So. 2d 787 (Fla. Dist. Ct. App. 1998).

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