Amy FIELDS, Appellant v. KLATT HARDWARE & LUMBER, INC., Appellee , 2012 Tex. App. LEXIS 4881 ( 2012 )

OPINION
No. 04-11-00610-CV
Amy FIELDS,
Appellant
v.
KLATT HARDWARE & LUMBER, INC.,
Appellee
From the 79th Judicial District Court, Jim Wells County, Texas
Trial Court No. 09-09-48404-CV
Honorable Richard C. Terrell, Judge Presiding
Opinion by: Rebecca Simmons, Justice
Sitting: Sandee Bryan Marion, Justice
Rebecca Simmons, Justice
Marialyn Barnard, Justice
Delivered and Filed: June 20, 2012
AFFIRMED
Appellant Amy Fields asserts she received chemical burns on her arms when drain
cleaner splashed on her as she opened the container. Fields sued the seller, Klatt Hardware and
Lumber, Inc., and the manufacturer, Masterjack Services, Inc., for damages. Masterjack never
answered or appeared. The trial court concluded Klatt was immune from liability under Texas
Civil Practice and Remedies Code section 82.003 and granted Klatt’s traditional motion for
04-11-00610-CV
summary judgment. See TEX. CIV. PRAC. & REM. CODE ANN. § 82.003 (West 2011). We affirm
the trial court’s judgment.
BACKGROUND
Amy Fields purchased a bottle of Masterjack Drain Opener from the Klatt Hardware and
Lumber, Inc. store in Orange Grove, Texas. Masterjack Drain Opener is manufactured by
Masterjack Services, Inc., a Colorado corporation that does not have a regular place of business
or a designated agent for service of process in Texas. According to Fields, when she opened the
flexible container, some of the drain cleaner splashed onto her hands and arms. She asserts she
suffered second and third degree chemical burns from the drain cleaner.
Fields alleged that the product was defective, and she sued Klatt and Masterjack. She
obtained personal service on Masterjack’s president, Donald Melton, in Colorado. She also
served Masterjack through the Texas Secretary of State in accordance with the long-arm statute.
See TEX. CIV. PRAC. & REM. CODE ANN. § 17.041–.045 (West 2008). As of the date of the
summary judgment, Masterjack had not answered or appeared. As discussed further below,
section 82.003 of the Texas Civil Practice and Remedies Code provides that a nonmanufacturing
seller of a defective product is generally not liable for harm caused by that product. See id.
§ 82.003(a) (West 2011). However, there is a provision that permits the plaintiff to proceed
against a nonmanufacturing seller if the product’s manufacturer is “not subject to the jurisdiction
of the court.” Id. § 82.003(a)(7)(B).
In its traditional motion for summary judgment, Klatt sought to establish that Masterjack
was subject to the jurisdiction of the court and (1) asserted it had served Masterjack, (2) offered
an affidavit averring Masterjack’s minimum contacts with Klatt in Texas, (3) insisted that there
were no genuine issues of material fact, and (4) contended that summary judgment was proper
-2-
04-11-00610-CV
because it had secured personal jurisdiction over Masterjack and it was entitled to judgment as a
matter of law. The trial court severed Fields’s and Klatt’s claims against Masterjack, abated the
severed cause, and granted Klatt’s motion for summary judgment that Fields take nothing against
Klatt. Fields appeals the trial court’s judgment.
TRADITIONAL SUMMARY JUDGMENT
A. Summary Judgment Requirements
A traditional summary judgment is proper if the summary judgment evidence shows that
“there is no genuine issue as to any material fact and the moving party is entitled to judgment as
a matter of law.” TEX. R. CIV. P. 166a(c); see Nixon v. Mr. Prop. Mgmt. Co., 690 S.W.2d 546,
548–49 (Tex. 1985). In its live pleading, a party’s admission of a fact that is adverse to its
position can be competent summary judgment evidence. Withrow v. State Farm Lloyds, 990
S.W.2d 432, 436 (Tex. App.—Texarkana 1999, pet. denied); see Gambrinus Co. v. Galveston
Beverage, Ltd., 264 S.W.3d 283, 289 n.4 (Tex. App.—San Antonio 2008, pet. denied). Further,
“summary judgment may be based on uncontroverted testimonial evidence of an interested
witness . . . if the evidence is clear, positive and direct, otherwise credible and free from
contradictions and inconsistencies, and could have been readily controverted.” TEX. R. CIV. P.
166a(c); accord Trico Techs. Corp. v. Montiel, 949 S.W.2d 308, 310 (Tex. 1997) (per curiam).
B. Standard of Review
We review the grant of a traditional motion for summary judgment de novo. Valence
Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005); Dove v. Graham, 358 S.W.3d 681,
684 (Tex. App.—San Antonio 2011, pet. denied). In this case Klatt moved for summary
judgment on an exception to liability for which he ultimately had the burden of proof. 1 The
1
Section 82.003 grants immunity to liability to nonmanufacturing sellers unless the claimant proves the
manufacturer is “not subject to the jurisdiction of the court.” TEX. CIV. PRAC. & REM. CODE ANN. § 82.003. If the
-3-
04-11-00610-CV
standard for reviewing Klatt’s summary judgment is whether the summary judgment proof
shows that “there is no genuine issue of material fact and that [Klatt] is entitled to judgment as a
matter of law.” See Nixon, 690 S.W.2d at 548; Gibbs v. Gen. Motors Corp., 450 S.W.2d 827,
828 (Tex. 1970). In deciding whether there is a disputed material fact issue precluding summary
judgment, “evidence favorable to the non-movant will be taken as true.” Nixon, 690 S.W.2d at
549. “Every reasonable inference must be indulged in [Fields’s] favor . . . and any doubts will be
resolved in [her] favor.” See id. “A defendant moving for summary judgment on an affirmative
defense has the burden to conclusively establish that defense.” Havlen v. McDougall, 22 S.W.3d
343, 345 (Tex. 2000); Villanueva v. Gonzalez, 123 S.W.3d 461, 464 (Tex. App.—San Antonio
2003, no pet.).
STATUTORY INTERPRETATION
The issue in this case revolves around the interpretation of subsections (a)(7)(B) and (c)
of section 82.003. See TEX. CIV. PRAC. & REM. CODE ANN. § 82.003(a)(7)(B), (c). To ascertain
the legislature’s intent for a particular statute, we begin with the statute’s plain language. Bragg
v. Edwards Aquifer Auth., 71 S.W.3d 729, 734 (Tex. 2002). “The plain meaning of the text is the
best expression of legislative intent unless a different meaning is apparent from the context or the
plain meaning leads to absurd or nonsensical results.” Molinet v. Kimbrell, 356 S.W.3d 407, 411
(Tex. 2011); accord City of Rockwall v. Hughes, 246 S.W.3d 621, 625–26 (Tex. 2008). We
review questions of statutory interpretation de novo. See Molinet, 356 S.W.3d at 411; City of
Rockwall, 246 S.W.3d at 625.
manufacturer is served through the secretary of state as required and the manufacturer fails to appear, then a
conclusive presumption arises that the “manufacturer is not subject to the jurisdiction of the court.” Id. § 82.003(c).
A seller may avoid the conclusive presumption that the manufacturer is not subject to the jurisdiction of the court by
“secur[ing] personal jurisdiction over the manufacturer in the action.” Id.
-4-
04-11-00610-CV
SECTION 82.003, LIABILITY OF NONMANUFACTURING SELLERS
Chapter 82 of the Civil Practice and Remedies Code addresses products liability. Section
82.003 addresses the liability of nonmanufacturing sellers; its pertinent parts follow.
(a) A seller that did not manufacture a product is not liable for harm caused to the
claimant by that product unless the claimant proves . . . (7) that the manufacturer
of the product is: (A) insolvent; or (B) not subject to the jurisdiction of the court.
....
(c) If after service on a nonresident manufacturer through the secretary of state in
the manner prescribed by Subchapter C, Chapter 17, the manufacturer fails to
answer or otherwise make an appearance in the time required by law, it is
conclusively presumed for the purposes of Subsection (a)(7)(B) that the
manufacturer is not subject to the jurisdiction of the court unless the seller is able
to secure personal jurisdiction over the manufacturer in the action.
TEX. CIV. PRAC. & REM. CODE ANN. § 82.003 (emphasis added) (footnote omitted).
ANALYSIS
Fields and Klatt agree that this appeal turns on whether Klatt conclusively established
that he secured personal jurisdiction over Masterjack. See id.
A. Fields’s Argument
Fields argues summary judgment was improper because she served Masterjack as
required in section 82.003(c), and therefore she is entitled to a conclusive and irrebuttable
presumption that Masterjack is not subject to the jurisdiction of the trial court. See id. She
asserts the statutory presumption satisfies subsection (a)(7)(B)’s provision which waives the
seller’s immunity from liability if the claimant proves the manufacturer is not subject to the
jurisdiction of the court. See id. § 82.003(a)(7)(B). She rejects Klatt’s assertion that it secured
personal jurisdiction over Masterjack because Klatt did not secure Masterjack’s answer or
appearance. In her view, securing personal jurisdiction means securing an appearance, not just
service. She insists Klatt did not secure personal jurisdiction over Masterjack in this case, and
thus the trial court erred by granting Klatt’s traditional motion for summary judgment.
-5-
04-11-00610-CV
B. Klatt’s Argument
Klatt argues that a seller may secure personal jurisdiction over a manufacturer by
properly serving the manufacturer under the long-arm statute—which includes pleading the
manufacturer’s minimum contacts with Texas sufficient to satisfy constitutional due process.
Klatt maintains that it secured personal jurisdiction over Masterjack because it served Masterjack
under the long-arm statute and the undisputed summary judgment evidence shows that
Masterjack established sufficient minimum contacts with Texas.
C. Section 82.003’s Plain Language
We believe that under the statute’s plain language the nonmanufacturing seller may
qualify for the exception without obtaining the manufacturer’s general appearance in the lawsuit.
However, the seller must do more than prove service of process on the manufacturer to establish
the exception to the presumption that the manufacturer is not subject to the court’s jurisdiction.
1. Operative Clauses
Subsection (a)(7)(B) waives the nonmanufacturing seller’s immunity from liability if the
claimant proves the manufacturer is “not subject to the jurisdiction of the court.” Id. § 82.003(a).
Until subsection (c) was added in 2009, the claimant had to prove the negative: the manufacturer
did not establish minimum contacts with Texas. See Dennis v. Giles Grp., Inc., No. 04-07-
00280-CV, 2008 WL 183062, at *6–7 (Tex. App.—San Antonio 2008, no pet.) (mem. op.)
(reviewing a no-evidence motion with disputed facts on the manufacturer’s minimum contacts).
But now, subsection (c)’s plain language reduces the burden on the claimant. See TEX. CIV.
PRAC. & REM. CODE ANN. § 82.003(c). If the nonresident manufacturer is served as required by
section 82.003(c) and “the manufacturer fails to answer or otherwise make an appearance,” the
claimant receives a conclusive presumption that “the manufacturer is not subject to the
-6-
04-11-00610-CV
jurisdiction of the court.” Id. § 82.003(c). However, if “the seller is able to secure personal
jurisdiction over the manufacturer in the action,” the presumption disappears. Id. (emphasis
added).
2. Securing Jurisdiction
To better understand what the legislature means by secure personal jurisdiction, we can
look to the section itself. See City of Rockwall, 246 S.W.3d at 625 (“In construing statutes, we
ascertain . . . the Legislature’s intent as expressed by the language of the statute.”). In subsection
(c), the legislature expressly addresses “service” on the manufacturer and what happens if “the
manufacturer fails to answer or otherwise make an appearance.” See TEX. CIV. PRAC. & REM.
CODE ANN. § 82.003(c).
(c) If after service on a nonresident manufacturer through the secretary of state in
the manner prescribed by Subchapter C, Chapter 17, the manufacturer fails to
answer or otherwise make an appearance in the time required by law, it is
conclusively presumed for the purposes of Subsection (a)(7)(B) that the
manufacturer is not subject to the jurisdiction of the court unless the seller is able
to secure personal jurisdiction over the manufacturer in the action.
Id. (emphasis added) (footnote omitted).
The legislature uses the phrase “service on” in the traditional sense when it describes service on
the manufacturer through the secretary of state. Notably, the legislature does not use the
terminology “service on” to describe the seller’s duty to “secure personal jurisdiction 2 over” the
manufacturer. See id. Moreover, not only is the phrase “secure personal jurisdiction” used
rather than “service on,” but the section would make little sense if the seller need only duplicate
the plaintiff’s service on the manufacturer to avoid the conclusive presumption that the
2
Neither Texas nor federal courts use the term “secure personal jurisdiction” with any regularity to suggest it is a
well-defined term of art. A federal practice guide seems to indicate that secure personal jurisdiction is synonymous
with service and minimum contacts. See generally 4A CHARLES ALAN WRIGHT ET AL., FEDERAL PRACTICE AND
PROCEDURE § 1069.7 (3d ed. 2002) (discussing how a court acquires personal jurisdiction over a person, including
service and minimum contacts, and noting “it is important to remember that a plaintiff also must secure personal
jurisdiction over a defendant with respect to each claim she asserts” (emphasis added)).
-7-
04-11-00610-CV
manufacturer is not subject to the jurisdiction of the court. We conclude that the terms “service
on” and “secure personal jurisdiction” are not synonymous.
A Texas court has personal jurisdiction over a nonresident defendant if the defendant has
been properly served and the nonresident defendant has established minimum contacts with
Texas such that the court’s “exercise of jurisdiction comports with traditional notions of fair play
and substantial justice.” See BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 795
(Tex. 2002) (citing Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)); see also Moki Mac
River Expeditions v. Drugg, 221 S.W.3d 569, 574 (Tex. 2007).
We believe the statute’s plain language shows that the legislature intended that—after the
claimant serves the manufacturer as required—the burden shifts to the seller to prove the
elements necessary to demonstrate the court’s personal jurisdiction over the nonresident
manufacturer. Those elements include proper service and evidence of minimum contacts
sufficient to subject the manufacturer to the jurisdiction of the court. 3 If the seller proves that the
court has personal jurisdiction over the nonresident manufacturer (i.e., proper service and
minimum contacts), the exception to the conclusive presumption applies, the statute immunizes
the seller, and the claimant must pursue the manufacturer.
3. Basis for Summary Judgment
Klatt’s sole ground for its traditional motion for summary judgment was that it had
secured personal jurisdiction over Masterjack, the statutory presumption against jurisdiction did
3
In some instances proper service may not be obtained through the Texas long-arm statute and other treaties and
statutes must be utilized. Under subsection 82.003(c) the burden remains with the seller to (1) obtain and prove
proper service and (2) prove the manufacturer’s minimum contacts. See In re J.P.L., 359 S.W.3d 695, 704–06 (Tex.
App.—San Antonio 2011, pet. filed) (discussing service requirements under the Hague Service Convention for a
nonresident defendant). See generally Convention on the Service Abroad of Judicial and Extrajudicial Documents
in Civil or Commercial Matters, arts. 2–5, Nov. 15, 1965, 20 U.S.T. 361.
-8-
04-11-00610-CV
not apply, Klatt was immune from liability under the statute, and it was entitled to judgment as a
matter of law.
Fields and Klatt agree that Klatt served Masterjack, 4 and both parties’ summary judgment
motions included evidence of Masterjack’s minimum contacts with Klatt in Texas. Klatt’s
motion included Gordon Klatt’s affidavit that Masterjack’s sales representatives both telephoned
him and personally visited him in his store to solicit Klatt’s purchases of Masterjack’s products.
See TEX. R. CIV. P. 166a(c) (listing affidavits as competent summary judgment evidence); Trico
Techs. Corp. v. Montiel, 949 S.W.2d 308, 310 (Tex. 1997) (per curiam) (same); see also Moki
Mac, 221 S.W.3d at 576 (citing Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d 777,
784–85 (Tex. 2005)) (“A nonresident defendant that directs marketing efforts to Texas in the
hope of soliciting sales is subject to suit here for alleged liability arising from or relating to that
business.”); Pulmosan Safety Equip. Corp. v. Lamb, 273 S.W.3d 829, 838 (Tex. App.—Houston
[14th Dist.] 2008, pet. denied) (same). Fields’s exhibits in her response to Klatt’s summary
judgment motion included sales orders from Masterjack, with Masterjack’s president’s name and
signature, for products sales from Masterjack to Klatt, Masterjack’s invoices to Klatt for
Masterjack products, and Klatt’s cancelled checks that paid Masterjack’s invoices.
4. Review of Summary Judgment
To properly grant Klatt’s motion for summary judgment, the trial court had to conclude
that Klatt had secured personal jurisdiction over Masterjack in the suit. See TEX. CIV. PRAC. &
REM. CODE ANN. § 82.003(c). Specifically, the trial court had to decide that there were no
genuine issues of material fact, and that the summary judgment evidence conclusively proved
that (1) Klatt had properly served Masterjack and (2) Masterjack was amenable to the
4
Fields also served Masterjack through the Texas Secretary of State.
-9-
04-11-00610-CV
jurisdiction of the trial court in the suit. See BMC Software, 83 S.W.3d at 795 (personal
jurisdiction); Nixon, 690 S.W.2d at 548–49 (summary judgment).
Fields and Klatt agree that Klatt properly served Masterjack under the Texas long-arm
statute. See TEX. CIV. PRAC. & REM. CODE ANN. § 17.044. Klatt also had to prove as a matter of
law that Masterjack established minimum contacts with Texas. Although Gordon Klatt was an
interested witness, his affidavit regarding Masterjack’s contacts with Texas was clear, specific,
consistent, and uncontroverted. See TEX. R. CIV. P. 166a(c); Trico Techs., 949 S.W.2d at 310.
Fields had the opportunity to controvert Klatt’s testimony and evidence, but she did not. Cf.
Dennis v. Giles Grp., Inc., No. 04-07-00280-CV, 2008 WL 183062, at *6–7 (Tex. App.—San
Antonio 2008, no pet.) (mem. op.) (reversing a summary judgment because the claimant offered
evidence that created a genuine issue of material fact about whether the Texas court could
exercise personal jurisdiction over the Taiwanese manufacturer). In fact, Fields’s summary
judgment evidence included depositions, documents, and discovery responses that support
Klatt’s assertions that Masterjack had minimum contacts with Texas sufficient to satisfy
constitutional due process. Fields’s own evidence substantiated Klatt’s assertions of
Masterjack’s minimum contacts with Texas, and she failed to raise any fact issues to defeat
personal jurisdiction over Masterjack. Cf. Withrow v. State Farm Lloyds, 990 S.W.2d 432, 436
(Tex. App.—Texarkana 1999, pet. denied). Having reviewed the summary judgment evidence
de novo, we hold that Klatt conclusively proved that Masterjack established minimum contacts
with Texas. See Moki Mac, 221 S.W.3d at 576 (“A nonresident defendant that directs marketing
efforts to Texas in the hope of soliciting sales is subject to suit here for alleged liability arising
from or relating to that business.”).
- 10 -
04-11-00610-CV
CONCLUSION
We hold that, under section 82.003 of the Civil Practice and Remedies Code, a
nonmanufacturing seller can secure personal jurisdiction over a nonresident manufacturer where
the seller proves that (1) the manufacturer has been properly served according to the
requirements of the applicable laws, including treaty requirements, and (2) the manufacturer
established minimum contacts with Texas sufficient to satisfy federal and state constitutional due
process requirements.
Here, there were no genuine issues of material fact pertaining to Klatt’s service on
Masterjack or Masterjack’s contacts with Texas. Further, Klatt’s summary judgment evidence
conclusively proves that Masterjack was served as required by subsection 82.003(c) and that
Masterjack established minimum contacts with Texas. Therefore, the trial court properly
concluded that Klatt (1) had secured personal jurisdiction over Masterjack in the suit, (2) was
immunized by the statute, and (3) was entitled to have Fields’s claims against it dismissed. We
overrule Fields’s issue and affirm the trial court’s judgment.
Rebecca Simmons, Justice
- 11 -