W. B. Dunavant & Co. v. Perkins

• Decision Date: 04 September 1973
• Citation: 498 S.W.2d 905
• Parties: W. B. DUNAVANT AND COMPANY, Appellant-Plaintiff, v. Rance PERKINS, Appellee-Defendant.
• Court: Tennessee Supreme Court

Page 905

498 S.W.2d 905

W. B. DUNAVANT AND COMPANY, Appellant-Plaintiff, v. Rance PERKINS, Appellee-Defendant.

Supreme Court of Tennessee.

Sept. 4, 1973.

Armstrong, Allen, Braden, Goodman, McBride & Prewitt, Memphis, for appellant.

Earl P. Davis, Davis & Davis, Memphis, for appellee.

OPINION

DYER, Chief Justice.

This case comes on direct appeal from the judgment of the Circuit Court of Shelby County, dismissing the complaint because of lack of jurisdiction over the person of the defendant, insufficiency of process, and insufficiency of service of process. Appellant's sole assignment of error is that the trial court should have found the defendant amenable to service of process and to the jurisdiction of the trial court under T.C.A. § 20--235, the Long-Arm Statute.

Appellant filed an action for breach of contract for failure of appellee to deliver thirty-two acres of cotton production from appellee's farm in Catron, Missouri, to appellant in Memphis, Tennessee. The complaint alleged that appellant was a Tennessee corporation with its principal place of business in Memphis, Tennessee. It further alleged that appellee appointed the National Farmers Organization of Corning, Iowa, as appellee's agent to sell appellee's cotton production and such an agreement to sell the cotton was made with the appellant. Finally, appellant alleged that due to appellee's failure to deliver the cotton production, appellant sustained a loss of Two Thousand Four Hundred and Five Dollars ($2,405.00).

The appellee filed a motion to dismiss on the following grounds: The court lacked jurisdiction over the subject matter of the case; the complaint failed to state a claim for relief; the court lacked jurisdiction over the person of the appellee; insufficiency of process; and insufficiency of service of process. The trial judge sustained the motion to dismiss on the last three grounds above.

Additionally, the appellant filed an affidavit of a partner of the appellant-company stating in substance that the appellant had accepted offers of sale by the National Farmers Organization on behalf of the appellee as well as several other farmers and that the oral contracts were accepted in Memphis. Attached to the affidavit and marked Exhibit 1, was a document entitled 'Bill of Sale' which constituted the agreement between the appellee, Mr. Perkins, and the National Farmers Organization governing their legal relationship.

From the record it is evident that the appellee, Mr. Perkins, as a cotton grower, and the appellant, W. B. Dunavant and Company, as a cotton buyer, each entered into separate agreements with the National Farmers Organization regarding Mr. Perkins' cotton production. The issue in this case is simply whether Mr. Perkins, a Missouri resident, is subject to the jurisdiction of Tennessee courts by virtue of the legal arrangements he made with the National Farmers Organization and by virtue of the actions of the National Farmers Organization pursuant to those arrangements.

The appellant contends that the National Farmers Organization was a marketing agent for Mr. Perkins, and, as his agent, the NFO entered into a contract with the appellant, the contract being consummated in Tennessee and requiring the delivery of warehouse receipts in Tennessee and payment by the appellant in Tennessee. This, the appellant argues, is sufficient contact with this jurisdiction to satisfy the due process clause of the Fourteenth Amendment to the United States Constitution and the requirements of T.C.A. 20--235(a) and (e).

Appellee's response directs itself to the absence of a specific allegation in the complaint that the place of contracting between the appellant and National Farmers Organization was in Tennessee, and denies that National Farmers Organization was appellee's agent. Furthermore, it is argued that any other transactions by the National Farmers Organization and the appellant regarding other cotton farmers is immaterial to this cause of action.

T.C.A. § 20--235 provides, in pertinent part, as follows:

Persons who are nonresidents of Tennessee and residents of Tennessee who are outside the state and cannot be personally served with process within the state are subject to the jurisdiction of the courts of this state as to any action or claim for relief arising from:

(a) The transaction of any business within the state;

(b) Any tortious act or omission within this state;

(c) The ownership or possession of any interest in property located within this state;

(d) Entering into any contract of insurance, indemnity, or guaranty covering any person, property, or risk located within this state at the time of contracting;

(e) Entering into a contract for services to be rendered or for materials to be furnished in this state.

(f) Any basis not inconsistent with the constitution of this state or of the United States.

'Person' as used herein shall include corporations and all other entities which would be subject to service or process if presented in this state. Any such person shall be deemed to have submitted to the jurisdiction of this state who acts in the manner above described through an agent or personal representative.

The above statute was carefully considered and determined to be constitutional in the case of Darby v. Superior Supply Co., 224 Tenn. 540, 458 S.W.2d 423 (1970). Therefore, it is necessary here only to decide whether its provisions apply to these facts and whether there would be a denial of due process of the law to hold Mr. Perkins to be within the jurisdiction of the courts of this State.

Particular reference has been made to the last paragraph of T.C.A. § 20--235, providing that a person

. . . shall be deemed to have submitted to the jurisdiction of this state who acts in the manner above described through an agent or personal representative.

It has frequently been held that activities, even if limited in time and scope, by a representative of a corporation may bring the corporation within the State's jurisdiction. However, in Darby, it was noted that the United States Supreme Court had said in Olberding v. Illinois Central Railroad Co., 346 U.S. 338, 74 S.Ct. 83, ...