Stuart G. Hagler v. Tim McNickle and Robert Yoder ( 2023 )

AFFIRMED and Opinion Filed April 13, 2023
S In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-22-00109-CV
STUART G. HAGLER, Appellant
V.
TIM MCNICKLE AND ROBERT YODER, Appellees
On Appeal from the 14th Judicial District Court
Dallas County, Texas
Trial Court Cause No. DC-20-19161
MEMORANDUM OPINION
Before Justices Molberg, Reichek, and Breedlove
Opinion by Justice Breedlove
The trial court granted appellees Tim McNickle’s and Robert Yoder’s special
appearances challenging personal jurisdiction. Appellant Stuart G. Hagler appeals,
complaining the trial court had personal jurisdiction over McNickle and Yoder and
that their challenges to personal jurisdiction were erroneously granted. Concluding
that the trial court lacked personal jurisdiction over McNickle and Yoder, we affirm
the trial court’s judgment.
I. BACKGROUND
According to Hagler’s petition, McNickle and Yoder formed Grupo Logistico
RTM S de RL de CV, Zihuatenejo (GL), a Mexican company, on or about January
30, 2013, for the purpose of mining and holding mineral interests.1 On May 15,
2018, the parties met in Duncanville, Texas, to discuss Hagler’s becoming a member
in GL. On May 18, 2018, McNickle, acting on behalf of GL, requested Hagler pay
$10,000.00 to GL to assist with GL’s mining efforts, which Hagler paid. McNickle
again requested funds the following month, and Hagler made two additional
payments of $10,000.00 to GL. Hagler also wired an additional $525.00 into a GL
account. Hagler claims he was to receive a 25% interest in GL for his contributions,
but on July 1, 2019, Hagler received notice of a 0.25% interest in GL.
Hagler filed suit on December 29, 2020, requesting the court find that
defendants breached their contract by failing to provide him with the agreed-upon
25% ownership interest.
Both Yoder and McNickle filed special appearances objecting to personal
jurisdiction. They attached affidavits to their special appearances. Both stated they
were not residents of Texas and that they had not done business in Texas. Hagler
responded to the special appearances and filed an affidavit along with a series of text
messages and emails that he relied on to establish personal jurisdiction. The trial
1
Max Bayless, another defendant in the underlying suit, was also a member of GL but was never served
and did not appear. Bayless is not a party to this appeal.
–2–
court held a hearing on May 12, 2021, and signed an order granting the special
appearances and dismissing the case against Yoder and McNickle.
Hagler appealed the trial court’s ruling on February 7, 2022. In five issues,
Hagler complains that: (1) in a contract dispute, whether or not a contract actually
exists does not determine jurisdiction as long as the plaintiff pleads a contract exists;
(2) McNickle and Yoder did not disprove every jurisdictional fact Hagler alleged;
(3) their special appearances and motions to challenge jurisdiction “were not
properly before the trial court”; (4) both had minimum contacts with Texas; and
(5) the trial court had jurisdiction over both Yoder and McNickle under the Texas
Long Arm Statute.
II. STANDARD OF REVIEW AND APPLICABLE LAW
A. Standard of Review
Whether a trial court has personal jurisdiction over a nonresident defendant is
a question of law that appellate courts review de novo. E.g., Old Republic Nat’l Title
Ins. Co. v. Bell, 549 S.W.3d 550, 558 (Tex. 2018). When a trial court does not issue
findings of fact and conclusions of law with its special appearance ruling, all facts
necessary to support the judgment and supported by the evidence are implied. Id.When the relevant facts in a case are undisputed, an appellate court need not consider
any implied findings of fact and considers only the legal question of whether the
undisputed facts establish Texas jurisdiction. Id.–3–
B. Burdens of the Parties in a Special Appearance
The plaintiff bears the initial burden of pleading sufficient allegations to bring
a nonresident defendant within the provisions of the Texas long-arm statute. E.g., id.
at 559; Moncrief Oil Int’l, Inc. v. OAO Gazprom, 414 S.W.3d 142, 149 (Tex. 2013).
In order to meet this burden, a plaintiff must show the act on which jurisdiction is
predicated, not a prima facie demonstration of the existence of a cause of action.
Steward Health Care Sys. LLC v. Saidara, 633 S.W.3d 120, 126 (Tex. App.—Dallas
2021, no pet.) (en banc) (internal citations omitted). This minimal pleading
requirement is satisfied by an allegation that the nonresident defendant is doing
business in Texas or committed tortious acts in Texas. Id. (citing Alencar v. Shaw,
323 S.W.3d 548, 553 (Tex. App.—Dallas 2010, no pet.)). If the plaintiff does not
meet this burden, the defendant need prove only that it does not reside in Texas to
negate jurisdiction. Id. (citing Siskind v. Villa Found. for Educ., Inc., 642 S.W.2d
434, 438 (Tex. 1982); Jani-King Franchising, Inc. v. Falco Franchising, S.A., No.
05-15-00335-CV, 2016 WL 2609314, at *4, (Tex. App.—Dallas May 5, 2016, no
pet.) (mem. op.)).
“[T]he plaintiff must meet its initial burden on a special appearance by
pleading, in its petition, sufficient allegations to invoke jurisdiction under the Texas
long-arm statute.” Id. at 129 (emphasis in original). The defendant’s burden to
negate all bases of personal jurisdiction alleged by the plaintiff is not triggered unless
plaintiff pleads sufficient allegations to bring the nonresident defendant within the
–4–
reach of Texas’s long-arm statute. Id. (citing Kelly v. Gen. Interior Constr., Inc.,
301 S.W.3d 653, 658 (Tex. 2010)).
If the defendant, in its special appearance, presents evidence that disproves
the plaintiff’s jurisdictional allegations, then the plaintiff should present evidence in
support of the petition’s allegations. Id. (citing Kelly, 301 S.W.3d at 659). If the
plaintiff’s evidence differs from the allegations in the petition, “then the plaintiff
should amend the petition for consistency.” Id. (citing Kelly, 301 S.W.3d at 659
n.6). Thus, the allegations on which the plaintiff bases the exercise of jurisdiction
over the defendant must be in the petition. Id. The plaintiff’s response to the special
appearance may contain evidence supporting the petition’s jurisdictional allegations,
but that evidence must be consistent with the allegations in the petition. Id.
C. Exercise of Personal Jurisdiction in Texas
Texas courts may exercise personal jurisdiction over a nonresident if “(1) the
Texas long-arm statute authorizes the exercise of jurisdiction, and (2) the exercise
of jurisdiction is consistent with federal and state constitutional due-process
guarantees.” Moncrief Oil, 414 S.W.3d at 150 (citing Moki Mac River Expeditions
v. Drugg, 221 S.W.3d 569, 574 (Tex. 2007)). The Texas long-arm statute extends
to the limits of due process. TV Azteca v. Ruiz, 490 S.W.3d 29, 36 (Tex. 2016); U-
Anchor Advert., Inc. v. Burt, 553 S.W.2d 760, 762 (Tex. 1977). The exercise of
personal jurisdiction over a nonresident defendant is constitutional when (1) the
nonresident defendant has established minimum contacts with the forum state and
–5–
(2) the exercise of jurisdiction comports with traditional notions of fair play and
substantial justice. BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 795
(Tex. 2002).
A nonresident defendant’s contacts with the forum state can give rise to
general or specific jurisdiction. Luciano v. SprayFoamPolymers.com, LLC, 625
S.W.3d 1, 8 (Tex. 2021). General jurisdiction is established when the defendant has
continuous and systematic contacts with the forum, rendering it essentially at home
in the forum state, regardless of whether the defendant’s alleged liability arises from
those contacts. TV Azteca, 490 S.W.3d at 37. Specific jurisdiction is established
when the nonresident defendant’s alleged liability arises from or is related to the
defendant’s activity conducted within the forum state. BMC Software, 83 S.W.3d at
796.
For the trial court to exercise specific jurisdiction in this case (1) Yoder and
McNickle must have made minimum contacts with Texas by purposefully availing
themselves of the privilege of conducting activities here, and (2) Yoder’s and
McNickle’s liability must have arisen from or related to those contacts. See Moki
Mac, 221 S.W.3d at 576.
III. ANALYSIS
A. Whether Yoder and McNickle’s special appearances were sufficient to
challenge the trial court’s jurisdiction
Before turning to Hagler’s pleadings, we must first consider whether
McNickle’s and Yoder’s special appearances were sufficient to challenge the trial
–6–
court’s jurisdiction. Hagler argues that their verifications and affidavits are
insufficient because they fail to state that they are based on personal knowledge,
citing International Turbine Serv., Inc. v. Lovitt, 881 S.W.2d 805, 808 (Tex. App.—
Fort Worth 1994, writ denied). We disagree. The International Turbine court did
not hold that an affidavit must state that it is based on personal knowledge but that
“it must show in some way that the affiant is personally familiar with the facts so
that he could personally testify as a witness.” Id. (internal citations omitted).
Further, Texas Rule of Civil Procedure 120a(3) states that affidavits “shall be made
on personal knowledge,” not that they must say explicitly that they were made on
personal knowledge. TEX. R. CIV. P. 120a(3). Both Yoder and McNickle recount
events in which they personally participated and thus their personal knowledge of
those facts is self-evident. Consequently, both affidavits meet the standard set forth
in Texas Rule of Civil Procedure 120a(3). We overrule Hagler’s third issue and turn
to consider the sufficiency of Hagler’s pleadings.
B. Whether Hagler pleaded sufficient facts to satisfy the long-arm statute
We next look to whether Hagler met his burden of pleading sufficient
allegations to bring McNickle and Yoder within the provisions of the Texas long-
arm statute.2 A plaintiff’s petition satisfies the long-arm statute when it alleges the
defendant did business in Texas. Steward Health Care, 633 S.W.3d at 126 (citing
2
On appeal, Hagler has abandoned his allegations that McNickle and Yoder are Texas residents and
that they are subject to general jurisdiction. Consequently, our discussion is limited to the trial court’s
specific jurisdiction.
–7–
Alencar, 323 S.W.3d at 553). In this case, Hagler did not generally allege that
McNickle or Yoder committed a tort in Texas or did business in Texas. Hagler also
did not plead that the Texas long-arm statute applied. Accordingly, we consider
whether Hagler alleged facts showing either appellee did business in Texas. See id.Hagler argues in his fourth issue that the statements included in his response
to the special appearances and the attached affidavit establish the requisite contacts
for personal jurisdiction. However, a response to a special appearance is neither a
pleading nor evidence, so we do not consider statements contained therein for
purposes of determining whether Hagler met his pleading burden. Steward Health
Care, 633 S.W.3d at 128. Additionally, the record is clear that Hagler never
attempted to amend his petition to include the facts asserted in his response or
affidavit or to include the necessary factual allegations identified in his response.
Therefore, we consider the response only to the extent that it is consistent with the
allegations in Hagler’s petition. Id. (citing Kelly, 301 S.W.3d at 659).
Hagler’s assertion that McNickle and Yoder did business in Texas rests
primarily on one brief statement in his petition: “On May 15, 2018, among Plaintiff
and Defendants at a meeting in Duncanville, Texas[,] Defendants agreed to sell and
convey a twenty-five percent interest in GL.” Thus, we must determine whether this
–8–
act, as alleged, constitutes a sufficient allegation of personal jurisdiction to shift the
burden to McNickle and Yoder.3 We hold that it does.
Hagler also alleged that “all or a substantial part of the events or omissions
giving rise to this lawsuit occurred in [Dallas County].” Liberally construing this
allegation together with the allegation regarding the May 15, 2018 meeting, we hold
that this statement is a sufficient pleading of a jurisdictional fact. See Ji-Haw Indus.
Co., Ltd. v. Broquet, No. 04-07-00622-CV, 2008 WL 441822, at *2–3 (Tex. App.—
San Antonio Feb. 20, 2008, no pet.) (holding that the language “All or a substantial
part of the events or omissions giving rise to this claim occurred in Duval County,
Texas” was sufficient to bring the defendant within the Texas long-arm statute
because, liberally construed together with other facts in the petition, plaintiff pleaded
that the incident forming the basis of the suit occurred in Texas). Therefore, Hagler
successfully shifted the burden to Yoder and McNickle to negate all bases of
jurisdiction pleaded by Hagler. See Steward Health Care, 633 S.W.3d at 129 (citing
Kelly, 301 S.W.3d at 658).
3
Hagler argues in his first issue that “in a contract dispute[,] whether or not a cont[r]act actually exists
does not determine jurisdiction as long as Plaintiff [pleads that] a contract does in fact exist.” Appellees do
not challenge this assertion on appeal. All parties appear to agree that the only relevant question for
determining the special appearances is whether Hagler pled the existence of a contract, not whether one
actually exists. Therefore, we sustain Hagler’s first issue to the extent it requests this Court to look only to
the contents of Hagler’s pleading rather than to the merits of his claims.
–9–
C. Whether the evidence negated all bases of jurisdiction pleaded by Hagler
Given that Hagler’s only specific jurisdictional allegation is that appellees met
with Hagler in Duncanville, Texas, on May 15, 2018, and agreed to sell him a 25%
interest in GL, and given the absence of findings of fact and conclusions of law, we
imply a fact finding that Hagler’s allegation was not true. BMG Software Belg., 83
S.W.3d at 795. We thus review the evidence to ascertain whether this implied
finding is supported by sufficient evidence. We conclude that it was.
In their affidavits, appellees do not specifically deny that this meeting took
place. Indeed, McNickle testified that in 2018 he attended two meetings in Texas
concerning the financing of GL’s mining endeavor. Yoder testified somewhat more
specifically, stating that in 2018 he met with Hagler on two “social occasions” and
that he and Hagler talked about GL’s mining endeavor. However, each appellee
testified by affidavit that he did not personally contract to sell Hagler anything while
in Texas or anywhere else. Thus, the affidavits support the implied finding at least
to the extent the trial court found that appellees did not reach any agreement with
Hagler, on May 15, 2018, or at any other time.
Hagler’s affidavit also supports the trial court’s implied finding. In the
affidavit, Hagler gave a fairly detailed account of his activities relating to GL,
including meetings with Bayless, McNickle, and Yoder. However, he did not testify
that there was any meeting with Bayless, McNickle, or Yoder in May 2018, much
less a meeting in Duncanville at which an agreement was reached. Rather, he
–10–
describes only one Texas meeting involving McNickle and Yoder—a meeting on
February 19, 2018, at Hagler’s home in Dallas. The meeting was arranged by
Bayless, and the participants discussed GL’s business, Hagler’s obtaining an interest
in GL, and Hagler’s contributing his oil-and-gas experience to GL’s benefit. Hagler
affirmatively stated that no agreement was reached at that time.
Next Hagler described a Texas meeting in March 2018 with Bayless alone.
He testified that at that meeting Bayless offered to transfer some of his GL shares to
Hagler and to seek similar transfers from Yoder and McNickle. Then, “[i]n early
April, Defendant Bayless, on behalf of Defendants Yoder, McNickle and himself
agreed to the transfer of equal parts of their respective ownership interest in order to
grant me a one-fourth interest in Grupo.” In return, Hagler was to provide oil-and-
gas services and advice. Hagler further testified that he had his Texas attorney draft
a formal agreement, and that McNickle supplied the attorney with some information
relevant to that agreement. But Hagler did not testify that the written agreement was
ever executed by anyone, and at the special-appearance hearing, Hagler’s attorney
conceded that no written agreement was ever reached. Hagler’s affidavit next
describes some “cash calls” in May and June 2018 that resulted in his sending money
per McNickle’s instructions. But Hagler did not testify that there was ever a Texas
–11–
meeting resembling the one he alleged in his petition at which McNickle and Yoder
actually agreed to convey interests in GL to him.
We conclude that the three affidavits, taken together, support the implied
finding that Hagler’s allegation about the May 15, 2018 meeting in Duncanville was
not true. Because the trial court permissibly concluded that the special-appearance
evidence effectively disproved Hagler’s only jurisdictional allegation, it did not err
by sustaining McNickle’s and Yoder’s special appearances. See Kelly, 301 S.W.3d
at 659 (noting that a specially appearing defendant can negate jurisdiction on a
factual basis by disproving the plaintiff’s allegations).
IV. CONCLUSION
We affirm the trial court’s judgment.
/Maricela Breedlove/
MARICELA BREEDLOVE
JUSTICE
220109F.P05
–12–
S
Court of Appeals
Fifth District of Texas at Dallas
JUDGMENT
Stuart G. Hagler, Appellant On Appeal from the 14th Judicial
District Court, Dallas County, Texas
No. 05-22-00109-CV V. Trial Court Cause No. DC-20-19161.
Opinion delivered by Justice
Tim McNickle and Robert Yoder, Breedlove. Justices Molberg and
Appellees Reichek participating.
In accordance with this Court’s opinion of this date, the May 13, 2021 Order
of the trial court is AFFIRMED.
It is ORDERED that appellees Tim McNickle and Robert Yoder recover
their costs of this appeal from appellant Stuart G. Hagler.
Judgment entered April 13, 2023
–13–