United Nuclear Corp. v. General Atomic Co.
| Decision Date | 15 October 1976 |
| Docket Number | No. 10943,10943 |
| Parties | UNITED NUCLEAR CORPORATION, a Delaware Corporation, Plaintiff- Appellee, v. GENERAL ATOMIC COMPANY, a partnership composed of Gulf Oil Corporation and Scallop Nuclear, Inc., Defendant-Appellant. |
| Court | New Mexico Supreme Court |
On December 21, 1975, an action was brought in the District Court of Santa Fe County by United Nuclear Corporation (UNC), a Delaware corporation with its principal place of business in New York, against General Atomic Company (GAC), a California partnership with its principal place of business in San Diego, California. The two partners in GAC are Scallop Nuclear (Scallop), a Delaware corporation with its principal place of business in New York, and Gulf Oil Corporation (Gulf), a Pennsylvania corporation, with its principal place of business in Pennsylvania. UNC served GAC by serving the statutory agent of Gulf in New Mexico.
The suit in the lower court was to obtain a declaratory judgment setting aside or modifying certain contractual obligations to GAC which UNC has with respect to the supply and delivery of uranium. An amended complaint was filed on April 5, 1976, seeking to void an additional contract dated June 20, 1974, on grounds similar to those alleged in the original complaint.
GAC moved to dismiss the action on the grounds that the district court lacked personal jurisdiction over the defendant and that proper service of process had not been made. The district court denied the motion. Defendant sought and was granted an interlocutory appeal by the Court of Appeals. The appeal has been certified to the Supreme Court pursuant to § 16--7--14(C), N.M.S.A.1953.
Points relied upon by GAC in this appeal are as follows:
As to Point I, service of process in this cause was effected by serving the statutory agent of Gulf in New Mexico. Service on the statutory agent of a corporation is personal service. Seaboard Coast Line Railroad Company v. Gillis, 294 Ala. 726, 321 So.2d 202, 250--206 (1975). Gulf is and was a general agent of the partnership described above. Section 66--1--9, N.M.S.A.1953, of the Uniform Partnership Act, provides in part as follows:
(1) Every partner is an agent of the partnership for the purposes of its business. * * *
It is argued that Gulf is not a party, under § 21--1--1(4)(o), N.M.S.A.1953, who may receive service of process on behalf of a partnership. Fed.R.Civ.P. 4(d)(3), which is identical insofar as pertinent to New Mexico's Rule 4(o), has been construed to mean that service of process on a general partner is effective service on the partnership. Porter v. Hardin, 164 F.2d 401 (5th Cir. 1947).
A partner is a general agent of the partnership. The agency of a partner is the hallmark of that particular form of business or professional association.
Rule 4(o), supra, insofar as material, provides that:
(Service shall be made.) Upon * * * a partnership * * * by delivering a copy of the summons and of the complaint to * * * (an) agent authorized * * * by law to receive service of process . . . if the agent is one authorized by statute to receive service and the statute so requires, by also mailing a copy to the defendant. (emphasis added).
Where the form of service is reasonably calculated to give the foreign defendant actual notice of the pending suit, the statute providing for such service is valid. Speir v. Robert C. Herd & Co., 189 F.Supp. 432 (D.C.Md.1960). Every object of the rule is satisfied where the agent is of such rank and character so that communication to the defendant is reasonably certain. Schering Corporation v. Cotlow, 94 Ariz. 365, 385 P.2d 234, 17 A.L.R.3d 617 (1963).
We have seen that § 66--1--9, supra, of the Uniform Partnership Act, appoints Gulf an agent of the partnership. Another New Mexico statute which appoints a partner an agent to receive service of process is § 21--6--5, N.M.S.A.1953, which provides:
21--6--5. Suits against partners--Joinder--Enforcement of judgment--Service of process.--Suits may be brought by or against a partnership as such, or against all or either of the individual members thereof; and a judgment against the firm as such may be enforced against the partnership's property, or that of such members as have appeared or been served with summons; but a new action may be brought against the other members in the original cause of action. (When the action is against the partnership as such, service of summons on one of the members, personally, shall be sufficient service on the firm.) (emphasis added).
(Ch. 6, § 6, (1880) N.M. Laws)
Rule 91 of the Rules of Civil Procedure, § 21--1--1(91), states:
Rule 91. Adopting procedural statutes.--1. All statutes relating to pleading, practice and procedure in judicial proceedings in any of the courts of New Mexico, existing upon the taking effect of the Act of the Eleventh Legislature, . . . and all statutes since enacted by any session of the legislature relating to said subjects, or any of them except as any of said statutes heretofore may have been or hereafter may be amended or vacated by order of this court, shall remain and be in effect and have full force and operation as rules of court.
Therefore, unless the court has adopted a conflicting rule, the prior procedural statute is still in effect and this court will avoid construing a Rule of Civil Procedure and statute in a manner which creates a conflict or inconsistency between the rule and the statute. See State v. Peavler, 87 N.M. 443, 535 P.2d 650 (Ct.App.), rev'd on other grounds, 88 N.M. 125, 537 P.2d 1387 (1975).
Rule 4(o), supra, and § 21--6--5, supra, are not inconsistent. They are complimentary. Section 21--6--5 appoints a partner an agent with authority to receive service of process. This is plainly contemplated by Rule 4(o) which speaks of an agent authorized by 'law' or 'by statute' (§ 21--6--5) to receive service of process.
Service of process upon Gulf, a general partner, is clearly effective service on the partnership GAC. This having been decided, the issue now becomes whether or not the district court could properly exercise in personam jurisdiction over the parties and the subject matter without violating state and federal due process standards. We must now determine whether the defendant has conducted its activities so that it would be fair and reasonable to subject it to the jurisdiction of the New Mexico courts.
In order to subject a defendant to jurisdiction in state court, the defendant must have certain 'minimum contacts' so that the exercise of jurisdiction would not offend 'traditional notions of fair play and substantial justice.' Internat. Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945). The Court therein stated that whether or not due process was satisfied depended upon the 'quality and nature of the activity in relation to the fair and orderly administration of laws.' Id. at 319, 66 S.Ct. at 160. The Court did not attempt to define what contacts were deemed sufficient but instead left the determination of what constitutes fair play and substantial justice to be decided on a case by case basis.
Following International Shoe, supra, the Supreme Court refined its position in McGee v. International Life Ins. Co., 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957), where the issuance of a single insurance policy was deemed a sufficient contact to permit California to exercise jurisdiction over a Texas defendant. This, however, did not mean that all limitations on a state's jurisdictional power were abolished and in Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958) the Court held that the defendant must have 'purposefully avail(ed) itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.' Id. at 253, 78 S.Ct. at 1240. The activity of the defendant in the forum state is not required to be directly related to the plaintiff's cause of action, Perkins v. Benguet Mining Co., 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed. 485 (1952), as long as there are sufficient contacts.
Therefore, we must look to see whether GAC's activities grant to New Mexico the power to adjudicate the issues involved herein. The plaintiff alleges the following activities of GAC which would constitute the transaction of business and also satisfy the 'minimum contacts' test of International Shoe, supra:
1. Gulf contracted with UNC for the production of uranium which it knew would be produced from UNC's mines in New Mexico. Deliveries are made from New Mexico. This contract was assigned to GAC and GAC seeks specific performance in the trial court.
2. GAC contracted with UNC for 3,000,000 pounds of uranium which it knew would be produced in New Mexico. The uranium was to be delivered f. o. b. The uranium was to be delivered f.o.b.
3. GAC engages in the business...
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