White v. Mac Air Corp.

• Decision Date: 24 December 1996
• Citation: 145 Or.App. 459,929 P.2d 1077
• Parties: Tommie C. WHITE, Jr., Appellant, v. MAC AIR CORP., a corporation; John Britting; Boyer Propeller Service, Inc., a corporation; and Robert E. Boyer, Respondents. 9502-00969; CA A89541.
• Court: Oregon Court of Appeals

Page 1077

929 P.2d 1077

145 Or.App. 459

Tommie C. WHITE, Jr., Appellant, v. MAC AIR CORP., a corporation; John Britting; Boyer Propeller Service, Inc., a corporation; and Robert E. Boyer, Respondents.

9502-00969; CA A89541.

Court of Appeals of Oregon.

Argued and Submitted March 27, 1996.

Decided Dec. 24, 1996.

Lloyd B. Ericsson, Portland, argued the cause for appellant. With him on the briefs was Ericsson & Egan.

Jacob Tanzer, Portland, argued the cause for respondents Mac Air Corp. and John Britting. With him on the brief were Phillip E. Joseph and Ball, Janik & Novack.

No appearance for respondents Boyer Propeller Service, Inc., and Robert E. Boyer.

Before WARREN, P.J., and EDMONDS and ARMSTRONG, JJ.

ARMSTRONG, Judge.

Plaintiff appeals from a judgment dismissing his complaint for a lack of personal jurisdiction over Mac Air Corporation, a Kansas corporation. ¹ We reverse in part and remand.

Plaintiff has the burden of alleging and proving facts necessary to establish personal jurisdiction over defendant. State ex rel. Circus Circus Reno, Inc. v. Pope, 317 Or. 151, 153, 854 P.2d 461 (1993). In making findings as to the existence of those facts, the trial court may base its determination on the allegations in the pleadings and the evidence submitted by both parties. Management Recruiters of Portland v. Harold Moore & Assoc., 118 Or.App. 614, 616, 848 P.2d 644, rev. den., 317 Or. 162, 856 P.2d 317 (1993). When we review a dismissal for lack of personal jurisdiction, we assume the truth of all well-pleaded allegations and any facts that could be presented to prove them. Sutherland v. Brennan, 131 Or.App. 25, 28, 883 P.2d 1318 (1994), affirmed on other grounds, 321 Or. 520, 901 P.2d 240 (1995). We construe the pleadings and evidence liberally to find jurisdiction, Sunrise Express v. Rhett Votaw & Co., 118 Or.App. 722, 724, 848 P.2d 1255 (1993), but assume that the court resolved all factual disputes consistent with its decision to dismiss the claim. Management Recruiters, 118 Or.App. at 616, 848 P.2d 644. ²

Before conducting our review, we must determine what documents properly bear on the jurisdictional issue. Mac Air argues that the only jurisdictional facts properly in the record are those contained in an affidavit of its president, John Britting, that accompanied its motion to dismiss. It contends that we should ignore the facts contained in declarations under penalty of perjury ³ submitted by plaintiff ⁴ and his attorney, because the trial court excluded the declarations and plaintiff has not assigned error to the exclusion.

We disagree with Mac Air's assertion that the trial court excluded the declarations. The trial court did not explicitly do that and in ruling on Mac Air's motion, the court referred to facts that are found only in plaintiff's declaration. ⁵ Thus, we conclude that the trial court considered the facts in the declarations in reaching its decision. Because defendant did not object below to consideration of those facts, we decline to consider its objection here. See Finney v. Bransom, 143 Or.App. 154, 158-59 n. 4, 924 P.2d 319 (1996) (summary judgment reversed because a genuine issue of material fact was created by arguably inadmissable hearsay evidence; defendant failed to object to evidence at trial court, so it was considered on appeal); Mains v. II Morrow, Inc., 128 Or.App. 625, 633 n. 2, 877 P.2d 88 (1994). Therefore, the declarations are part of the evidentiary record before us and we will consider the facts in them in reviewing the trial court's decision to dismiss the case.

The affidavit submitted by Mac Air states the following facts. Mac Air is a Kansas corporation. It advertised an airplane in Trade-A-Plane magazine, which is published in Tennessee and distributed worldwide. Plaintiff called Mac Air about the plane, later traveled to Kansas to inspect it and returned to Kansas to retrieve it. The exhibits attached to the affidavit establish that the parties engaged in long-distance communications about the purchase, but the affidavit asserts that plaintiff signed the purchase agreement in Kansas.

In his declaration, plaintiff states that he is an Oregon resident who has a subscription to Trade-A-Plane magazine. He saw the Mac Air advertisement in the magazine and called Mac Air to ask about the airplane. In response, Mac Air sent plaintiff information about the plane, including specific representations about its condition. Plaintiff asserts that the parties exchanged phone calls before he went to Kansas to inspect the plane. He says that he did not purchase the plane then but only negotiated with Mac Air about the proposed purchase terms, including his specific condition that the plane's propellers be overhauled. After more long-distance negotiations, plaintiff asserts that he signed the purchase agreement in Oregon. Finally, he traveled from Oregon to Kansas to pick up the airplane. He inspected the plane on his return to Oregon and discovered that the propellers were not airworthy. He asserts that he suffered injury in Oregon to property, the airplane, and, consequently, to himself, because he is a commercial pilot and could not use the plane in revenue-producing work.

On appeal, plaintiff argues that the court has personal jurisdiction over defendants under ORCP 4 C, 4 D and 4 L. We first must consider whether the court has jurisdiction under ORCP 4 C or 4 D, see State ex rel. La Manufacture Francaise Des Pneumatiques Michelin v. Wells, 294 Or. 296, 299, 657 P.2d 207 (1982), before turning to ORCP 4 L, the "catchall" provision. State ex rel. Hydraulic Servocontrols Corp. v. Dale, 294 Or. 381, 384, 657 P.2d 211 (1982).

We conclude that neither ORCP 4 C nor 4 D confers jurisdiction in this case. ⁶ Under ORCP 4 D, the claimed injury must occur in Oregon. Under ORCP 4 C, the location of the claimed injury is irrelevant, but the injury must arise from an act or omission in Oregon. Here, plaintiff alleges that Mac Air warranted that the airplane was airworthy, but it was not airworthy because the propellers had not been overhauled. His claim for breach of contract arose in Kansas the moment he took possession of the allegedly defective airplane. Because " '[a]n injury occurs at the time that the claim accrues,' " Marvel v. Pennington GMC, Inc., 98 Or.App. 612, 616, 780 P.2d 760 (1989) (citation omitted), plaintiff's injury occurred in Kansas. ⁷ The omission out of which the alleged injury arose, Mac Air's failure to deliver an airworthy airplane, also occurred in Kansas. Because both the alleged injury and the omission that caused it occurred in Kansas, neither ORCP 4 C nor 4 D confers personal jurisdiction over Mac Air in this case.

Because neither of the specific provisions of ORCP 4 cited by plaintiff confers jurisdiction, we turn to ORCP 4 L. ORCP 4 L provides for personal jurisdiction over a defendant

"in any action where prosecution of the action against a defendant in this state is not inconsistent with the Constitution of this state or the Constitution of the United States."

ORCP 4 L has been interpreted to extend the jurisdiction of Oregon courts over out-of-state defendants as far as due process permits. Smith v. O'Byrne, 113 Or.App. 128, 131, 831 P.2d 709, rev. den., 313 Or. 627, 835 P.2d 916 (1992). In Circus Circus, 317 Or. at 159, 854 P.2d 461, the Supreme Court summarized the test to determine "whether an extension of jurisdiction over an out-of-state defendant comports with due process":

"First, the defendant must have 'minimum contacts' with the forum state. 'Minimum contacts' will be found where the defendant has 'purposefully directed' its activities at residents of the forum state and where the litigation 'arises out of or relates to' those activities. Burger King Corp. v. Rudzewicz, [471 U.S. 462, 472, 105 S.Ct. 2174, 2182, 85 L.Ed.2d 528 (1985) ]. Second, even if minimum contacts exist, the exercise of jurisdiction must be reasonable; in the light of the various factors deemed relevant by the Court, the exercise of jurisdiction must comport with 'fair play and substantial justice.' Id. at 476-77 ."

Applying that test here, we hold that ORCP 4 L confers jurisdiction over Mac Air.

Plaintiff presented facts that demonstrate that Mac Air purposefully directed its activities at plaintiff, a resident of Oregon, and that the litigation relates to those activities. Mac Air advertised the airplane in a magazine that was distributed worldwide. It intended its advertisement to entice someone into purchasing the airplane. The advertisement reached Oregon and convinced plaintiff to respond to it. Once plaintiff responded, Mac Air took affirmative steps to sell the plane to him. It sent him information about the plane, called him in Oregon about it, and eventually sold it to him, knowing that he was returning to Oregon with it. Through those actions, Mac Air purposefully directed its activities at a resident of Oregon.

The litigation relates directly to Mac Air's contacts with plaintiff. Plaintiff alleges that Mac Air expressly warranted that the airplane was airworthy but that it was not because the propellers had not been overhauled. Thus, plaintiff alleged a breach of the contract that caused plaintiff damage. That contract was the subject of Mac Air's contacts with Oregon. We conclude that Mac Air purposefully directed its activities toward an Oregon resident, which established minimum contacts with Oregon, and that the claim at issue relates directly to those contacts. Therefore, the first part of the jurisdictional test is met.

The second part of the test is closely related to the nature of the contacts defendant has with the state. As the Supreme Court said in Hydraulic Servocontrols, 294 Or. at 387, 657 P.2d 211:

"It is the defendant's contacts with the forum state which make it reasonable for that state to extend the territorial limits of its power and exercise jurisdiction. One way to judge that reasonableness is by...