Simms v. Hobbs

• Decision Date: 18 January 1966
• Docket Number: No. 40674,40674
• Court: Oklahoma Supreme Court
• Parties: G. H. SIMMS and F. E. Currell, a co-partnership doing business as Driffing Dunes Motel, Plaintiffs in Error, v. T. G. HOBBS, Defendant in Error.

Page 503

411 P.2d 503

1966 OK 5

G. H. SIMMS and F. E. Currell, a co-partnership doing

business as Driffing Dunes Motel, Plaintiffs in Error, v. T. G. HOBBS, Defendant in Error.

No. 40674.

Supreme Court of Oklahoma.

Jan. 18, 1966.

Motion to Amend Opinion Denied Feb. 28, 1966.

Syllabus by the Court

1. Statute providing jurisdiction for courts of the state over a person transacting business within the state, by personal service outside the state, was not violative of the due process clause of the Fourteenth Amendment to the Federal Constitution. 1953 Comp. Sec. 21-3-16; U.S.C.A.Const. Amend. 14.

2. A state may constitutionally require that a resident of a foreign jurisdiction doing business within the state be subject to its jurisdiction as to a cause of action arising out of business transacted by such nonresident within the state. U.S.C.A.Const. Amend. 14.

3. A party has no vested right in any particular remedy or method of procedure.

4. The foundations of jurisdiction include the interest that a state has in providing redress in its own courts against persons who inflict injuries upon, or otherwise incur obligations to, those within the ambit of the state's legitimate protective policy, and limits on exercise of jurisdiction are not 'mechanical or quantitative' but are to be found only in requirement that provisions made for such purpose must be fiar and reasonable in circumstances, and must give to defendant adequate notice of claim against him, and an adequate and realistic opportunity to appear and he heard in his defense.

5. Oklahoma resident who went to New Mexico and executed written contract agreeing to purchase realty at an agreed price and made earnest money deposit by check drawn on Oklahoma bank, transacted business in that State within meaning of statute providing method for New Mexico court to obtain jurisdiction over nonresident upon personal service made outside state in accordance with statutes of New Mexico.

Appeal from District Court of McCurtain County; Howard Phillips, Judge.

Suit by plaintiffs to recover upon foreign judgment. The trial court entered judgment for defendant and plaintiffs appeal. Reversed and remanded with directions.

Tom Finney, Idabel, for plaintiffs in error.

Ed Shipp, Idabel, for defendant in error.

BERRY, Justice.

The sole issue involved in this appeal is whether a personal judgment rendered in the court of another state, based upon substituted service upon an Oklahoma resident under a 'long-arm' statute authorizing such service, is enforceable in this jurisdiction.

In 1959 the State of New Mexico adopted this statute (Laws 1959, Ch. 153), NMA 1953, Section 21-3-16, which provides:

'21-3-16. Personal service of process outside state--Business transacted in state--Operation of motor vehicle upon state highway--Tort committed within state--Insurance contract.--A. Any person, whether or not a citizen or resident of this state, who in person or through an agent does any of the acts enumerated in this subsection thereby submits himself or his personal representative to the jurisdiction of the courts of this state as to any cause of action arising from:

'(1) The transaction of any business within this state;

'(2) The operation of a motor vehicle upon the highways of this state;

'(3) The commission of a tortious act within this state; or

'(4) Contracting to insure any person, property or risk located within this state at the time of contracting.

'B. Service of process may be made upon any person subject to the jurisdiction of the courts of this state under this section by personally serving the summons upon the defendant outside this state and such service has the same force and effect as though service had been personally made within this state.

'C. Only causes of action arising from acts enumerated in this section may be asserted against a defendant in an action in which jurisdiction is based upon this section.

'D. Nothing contained in this section limits or affects the right to serve any process in any other manner now or hereafter provided by law.'

The factual background is uninvolved and appears in the record by stipulation. Plaintiffs in error, hereafter called plaintiffs, were a partnership doing business as Drifting Dunes Motel in Clovis, New Mexico at all times material to this controversy. Defendant, an Oklahoma resident, went to New Mexico in the fall of 1960. On November 28, 1960, defendant entered into a written contract for purchase of this motel from plaintiffs for $325,000.00, and as part of such transaction executed and delivered for escrow his check for $5,000.00 earnest money. Defendant, a resident of Idabel, Oklahoma, thereafter returned home, and for reasons known to himself, stopped payment upon the check.

On February 16, 1961, plaintiffs filed suit in the District Court (Curry County) of New Mexico, alleging the foregoing matters, defendant's breach of the written contract and dishonor of the check; that upon execution of the purchase contract plaintiffs had taken this property off the market although there were others ready, willing and able to purchase; as a result plaintiffs had suffered $3,500.00 damages because of defendant's failure to comply with the contract. Plaintiffs asked judgment for amount of earnest money, damages and costs. Summons issued out of the New Mexico court, directed to the Sheriff of McCurtain County, Oklahoma, and was served upon defendant, who neither appeared nor filed pleading in the action. On March 24, 1961, the foreign District Court, based upon plaintiffs' certificate of default, rendered judgment for plaintiffs as prayed.

On May 16, 1961, plaintiffs used defendant in the District Court of McCurtain County, alleging this judgment was in force and effect, demand for payment having been made which remained unsatisfied; that such judgment was not subject to the Intangible Tax Law. The New Mexico judgment, properly authenticated and certified, was pleaded as part of the petition wherein plaintiffs sought judgment against defendant.

After disposition of preliminary pleadings and overruling of the demurrer to the petition, defendant answered admitting rendition of the judgment sued upon but affirmatively alleged he had never been a resident of New Mexico and neither appeared nor authorized anyone to appear in his behalf in any action there; that he never was served personally with summons in New Mexico, and the purported service in Oklahoma did not confer personal jurisdiction against defendant and the purported judgment entered upon such service was void.

By stipulation the parties agreed the statute was as above quoted; transcript of the New Mexico proceedings could be introduced and considered as evidence in determining issues of law and fact; that the parties and their residences were as alleged, and the only service upon defendant was in McCurtain County; defendant made no appearance in New Mexico; both the contract and the earnest money check were executed and delivered in New Mexico; an authenticated copy of the summons and return could be introduced and considered by the court in determining issues of law and fact.

At the trial Hobbs testified he was the defendant in the action wherein this judgment was rendered and same had not been paid; he had been a resident of Oklahoma for many years, never had been a resident of New Mexico, was not in the State when the action was filed, or at any time since that date; had not appeared, or authorized any appearance in his behalf, and had not been served with summons in New Mexico.

After hearing the case the trial court took the matter under advisement and on March 22, 1963, entered judgment holding that as a matter of law plaintiffs were not entitled to recover.

Plaintiffs' position is that the only issue involves the constitutionality of the New Mexico statute, supra, fixing jurisdiction in the courts of that State, in specified causes of action, under process served outside the State. Plaintiffs urge that we apply the rule that where a judgment entered by a foreign court of general jurisdiction is relied upon and the duly authenticated record is produced in evidence, it is presumed the court rendering the judgment had jurisdiction of the parties and the subject matter, absent proof or a contrary showing by the record. Allen v. Allen, 201 Okl. 442, 209 P.2d 172, 14 A.L.R.2d 216. Such foreign judgment is not open to reexamination, either upon the merits or from voidable irregularities, by this Court. Thompson v. William Ede Co., 187 Okl. 469, 103 P.2d 530. However, this Court can exercise jurisdiction to inquire into a foreign judgment for jurisdictional defects on the face of the record without regard to requirements of full faith and credit. Lee v. Franklin, 171 Okl. 70, 40 P.2d 257.

Upon this basis of their argument, above summarized, plaintiffs next point out that the statute, supra, has been declared constitutional by the Supreme Court of New Mexico. See Melfi v. Goodman, 69 N.M. 488, 368 P.2d 582. Thus plaintiffs submit, as conclusive and decisive of the issue on appeal, that the statute involved is a constitutional enactment, derived from exercise of legislative authority, and is not violative of the due process clause (Fourteenth Amendment) of the United States Constitution.

Although recognizing the correctness of the rules announced in the cases cited by plaintiffs, it appears that this argument tends to oversimplify the problem. This seems true particularly in view of other decisions which forcefully declare that a separate action in our own courts may provide the proper vehicle for questioning the jurisdiction of the court of a foreign state. And, questions concerning a foreign court's jurisdiction of the cause of action may be reached by collateral attack, even after a defendant had entered appearance in the foreign forum. Brasier v. Brasier, 200 Okl. 689, 200 P.2d 427, and authorities there cited. In the present appeal no issue is...