Triplett v. R. M. Wade & Co.

• Decision Date: 07 November 1973
• Docket Number: No. 19721,19721
• Citation: 200 S.E.2d 375,261 S.C. 419
• Court: South Carolina Supreme Court
• Parties: Lemuel TRIPLETT, Jr., as Temporary Administrator of Lemuel Triplett, Respondent, v. R. M. WADE AND COMPANY and Columbia Supply Company, Defendants, of whom R. M. Wade and Company is, Appellant.

Page 375

200 S.E.2d 375

261 S.C. 419

Lemuel TRIPLETT, Jr., as Temporary Administrator of Lemuel

Triplett, Respondent, v. R. M. WADE AND COMPANY and Columbia Supply Company, Defendants, of whom R. M. Wade and Company is, Appellant.

No. 19721.

Supreme Court of South Carolina.

Nov. 7, 1973.

Robinson, McFadden, Moore & Pope, Columbia, for appellant.

Dallas D. Ball and Richardson & Plowden, Columbia, for respondent.

BUSSEY, Justice.

Involved in this appeal are two tort actions in which summonses but no complaints were served. The record would indicate that one is for the alleged wrongful death of one Lemuel Triplett, and the other the surviving cause of action for injury to said Triplett. Both would appear to be based upon the alleged malfunction of a Wade Quicklock coupler unit manufactured and sold by the appellant R. M. Wade and Company and in use by Lone Star Industries at Olympia Village, Columbia, South Carolina. Appellant Wade is an Oregon corporation not domesticated to do business in South Carolina and service of the summonses in the two actions was effected upon Wade pursuant to Sec. 10--424 of the 1962 Code of Laws.

Wade appeared specially through its attorneys for the sole purpose of moving to quash the purported service of process upon it and to dismiss the actions for lack of jurisdiction. These motions were heard by the Honorable J. A. Spruill, Presiding Judge, upon documentary evidence and affidavits. Thereafter, the trial judge denied the motions to dismiss and held that the Court of Common Pleas for Richland County had jurisdiction of the appellant Wade in these two actions. This appeal followed.

While the appellant states and argues several questions, basically there is only one question involved on this appeal. That question, under the controlling decisions of the United States Supreme Court and this Court, is simply whether or not appellant Wade had such contact with this State that the maintenance of these actions against it in South Carolina does not 'offend traditional notions of fair play and substantial justice'. Such is the test for determining whether the due process clause of the Fourteenth Amendment to the United States Constitution is violated by the exercise of in personam jurisdiction over a foreign corporation. We proceed to review the facts in the light of the stated question. Most unfortunately, and adding somewhat to the difficulty of decision is the circumstance that plaintiff's counsel furnished the Court only the barest minimum of facts pertaining to the issue of jurisdiction. Much more pertinent information was furnished by Wade in resisting jurisdiction.

Wade has no agents, officers, servants, offices, places of business, warehouses or listed telephones in South Carolina. It manufactures Wade Quicklock couplers at its plant in Portland, Oregon, which couplers are used for joining pipes or other apparatus for use in transmitting or conducting liquids, gases or air. On July 1, 1955, Wade entered into a distributor agreement with John W. Burress of Roanoke, Virginia, then a proprietorship now a corporation. By the terms of such agreement, Burress acquired exclusive right to sell and distribute Wade Quicklock couplers to certain specified customers only, in eleven southern and southeastern states, including South Carolina. At one point such agreement proclaims the distributor to be 'an independent contractor', but such proclamation, of course, did not necessarily make him such.

An examination of the agreement shows that Wade exercised a considerable measure of control over the operations of Burress. The distributorship of Burress was restricted to the sale of Quicklock couplers to contracting, mining, petroleum and industrial services. Specifically exempted from the agreement was the distribution of such couplers to irrigation and farming enterprises. Wade reserved to itself the right to sell directly to various export agents, manufacturers, the U.S. government, etc. Wade agreed to refer to the distributor any inquiries from within the territory except those from prospects to which Wade was permitted to make sales, and Burress was required to give such inquiries prompt and efficient handling through direct contact, to follow up any prospect aggressively and report back to Wade the final outcome. Applied literally, this provision of the contract required Burress to follow up on behalf of Wade inquiries from irrigation and farming enterprises to whom Burress had no right to sell.

Under the agreement, Wade controlled the prices by which Burress could purchase; agreed to furnish him with current advertising literature and display material provided that such remained the property of the manufacturer and should be returned to it upon request. Burress agreed to advertise and promote the trademark 'Wade Quicklock' in the designated territory. It was provided that Wade would deliver products ordered by Burress to any point or destination within the territory designated by Burress at the time of order. Wade warranted all of the couplers and parts therefor, of its own manufacture, against defective workmanship and materials for a period of one year from the date of shipping, but limited its liability under such warranty to furnishing of replacement parts FOB for the destination specified in the original order.

The fifth paragraph of the agreement was as follows:

'Distributor agrees to maintain fair and reasonable selling prices; to render proper services to purchasers of Wade Quicklock couplers; to ascertain that all services rendered shall at all times be conducted and maintained so as not to detract from, interfere with, or reflect upon the reputation of Manufacturer or its products. Distributor is not an agent or employee of Manufacturer but an independent contractor, and said products will be sold in Distributor's name. Distributor shall, however, advertise said products as being furnished by Manufacturer and shall not remove from said products any identifying marks placed thereon by Manufacturer, and any stamp placed thereon by Distributor shall be subject to Manufacturer's approval.'

Either party could terminate the agreement by simply giving 90 days written notice to the other, but Wade reserved the right to terminate the same without notice upon the failure of Burress to perform any obligation required of him under the agreement.

When the distributorship agreement is analyzed, it clearly shows that Wade contemplated making sales to certain customers in the territory through Burress; contemplated making certain sales directly by Wade; and that it either already had or contemplated establishing a different means or channel of marketing its product to irrigation and farming projects within the territory. Required of Burress by the agreement was the promotion of Wade's product and good name throughout the territory with all potential customers for Wade's product, whether or not Burress could sell to such customers under the agreement.

The record discloses that Wade Quicklock couplers are stocked by W. P. Law and Co., on Corley Mill Road, Lexington, South Carolina, and such fact is evidence that Wade has been successful in its efforts over a long period of years to establish a market for the sale of its product to 'irrigation and farming enterprises' in South Carolina. It is not inappropriate, we think, to judicially notice that in the classified yellow pages of the Columbia telephone directory, W. P. Law & Co. advertises itself under the caption 'Irrigation Systems and Equipment.'

Two publications of the appellant Wade, to-wit: 'Quicklock Installation' and 'Wade Quicklock Couplers' were obtained in South Carolina by Lone Star Industries prior to the accident giving rise to these actions. One Harold P. Tennant, an employee of Wade for approximately eighteen years, lived in Farmville, Virginia, and was designated by Wade as 'Eastern national sales manager, irrigation division.' According to his affidavit, Mr. Tennant's primary duties or functions with the company were to call upon distributors who bought from Wade and to make investigations for Wade when required. Following the accident at Lone Star Industries in 1971, which gave rise to these causes of action, Mr. Tennant came to Columbia for the purpose of investigating said accident on behalf of Wade.

The record contains no direct evidence as to the volume of Quicklock couplers being shipped into and sold in South Carolina, nor as to precisely where or how Lone Star Industries acquired the couplers being used by it. We deem to be immaterial, however, the precise means by which Lone Star acquired its couplers, it being readily inferable that such were acquired through one of Wade's designated channels for marketing the same in South Carolina.

Jurisdiction, as we understand the controlling, legal principles, does not rest simply upon the measure of success which his rewarded Wade's effort or the volume of sales which it has achieved in South Carolina. But, to the extent that such is entitled to weight, it is certainly reasonable to infer that Burress has satisfactorily performed the task of promoting the sales of Wade's Quicklock couplers throughout the territory, including South Carolina, or else Wade would not have continued this agreement over a period of 16 or 17 years. It seems quite clear that Wade has been engaged, at least since 1955, in an effort to develop to the fullest extent a market for its products in South Carolina through more than one channel, and it is inferable that certainly a measure of success has been achieved.

It is well settled that a finding of the lower court that a defendant was transacting business in South Carolina to the extent necessary to subject it to the jurisdiction of the courts of this State is binding upon us unless without support in the evidence, or manifestly influenced or controlled by error of law. Thompson v. Ford Motor Co., 200 S.C. 393, 21 S.E.2d 34; ...