Stephen H. Snider v. Mary Lou Snider Metcalfe, etc., and Randy Ransom Culler, etc.

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
STEPHAN H. SNIDER,
Appellant,
v.
MARY LOU SNIDER METCALFE, individually and as Trustee under the
Testamentary Trusts under November 17, 1986 Last Will and Testament
of HARRISON SNIDER, Deceased, and RANDY RANSOM CULLER,
individually and as Trustee under the Testamentary Trusts under
November 17, 1986 Last Will and Testament of HARRISON SNIDER,
Deceased,
Appellees.
No. 4D13-4043
[February 4, 2015]
Appeal from the Circuit Court for the Fifteenth Judicial Circuit, Palm
Beach County; Martin H. Colin, Judge; L.T. Case No.
502009CP005493XXXXSB.
James A. Herb of Herb Law Firm, Chartered, Boca Raton, for appellant.
George P. Ord of Murphy Reid, L.L.P., Palm Beach Gardens, for
appellees.
FORST, J.
Appellant Stephan Snider appeals the final order dismissing his case
against Appellees Mary Lou Snider Metcalfe and Randy Ransom Culler for
lack of personal jurisdiction. We find no error with the trial court’s
determination that it lacked personal jurisdiction over Appellees, and thus
we affirm; however, we write to address Appellant’s preliminary claim that
Appellees waived their right to contest personal jurisdiction.
Background
Appellant is the son of the deceased Harrison Snider (“Decedent”).
Appellee Mary Lou Snider Metcalfe (“the Wife”) was the wife of the Decedent
at the time of his death. In 1986, the Decedent executed a last will and
testament in Florida. The will provided for the creation of three
testamentary trusts (“the Trusts”). The named co-trustees for the Trusts
were the Wife and a friend of the Decedent, James Frevert. Appellant was
a beneficiary of the Trusts.
The Decedent died later in 1986. His will was probated in Palm Beach
County, and the Wife and Frevert commenced serving as co-trustees of all
the Trusts. In 1998, the Wife moved from Florida to North Carolina.
Frevert resigned as co-trustee in 2001, and then the Wife appointed her
relative, Michael S. Culler, as co-trustee. Michael Culler served as co-
trustee until 2006, and then the Wife appointed another relative, Appellee
Randy Culler, as co-trustee.
In December 2009, Appellant filed a complaint against Appellees, as
the current co-trustees of the Trusts, and Michael Culler, as a former co-
trustee (but he was eventually dismissed from the suit), primarily alleging
breach of fiduciary duty and breach of trust. In response, the Trustees
moved to dismiss the complaint on the grounds of statute of limitations
and laches in February 2010. This motion did not assert lack of personal
jurisdiction over Appellees as a defense. No hearing was set for the motion.
While the motion was pending, Appellees participated in discovery by
responding to Appellant’s interrogatory requests. Nothing occurred in the
case until December 2011, when Appellees filed a notice of intent to use
trust funds to pay for attorneys’ fees and costs. The next filing was
Appellees’ amended motion to dismiss in July 2012. The amended motion
requested dismissal of the action solely on the basis of lack of personal
jurisdiction over Appellees. Appellees also filed affidavits in support of
their amended motion. After several additional amendments to both the
complaint and the motion to dismiss, the trial court ultimately granted
Appellees’ motion and dismissed the complaint on the grounds of lack of
personal jurisdiction.
Analysis
Appellant first argues on appeal that Appellees waived their right to
contest personal jurisdiction in the case because they filed an initial
motion to dismiss without asserting a challenge to the court’s jurisdiction
over them. Whether a defendant has waived the defense of lack of personal
jurisdiction is a pure question of law, which we review de novo. Wiggins
v. Tigrent, Inc., 147 So. 3d 76, 80 (Fla. 2d DCA 2014).
Lack of personal jurisdiction is a waivable defense that must be raised
at the “first opportunity” and before the defendant takes any steps in the
proceeding constituting submission to the court’s jurisdiction. See Fla. R.
2
Civ. P. 1.140(b); Re-Employment Servs., Ltd. v. Nat’l Loan Acquisitions Co.,
969 So. 2d 467, 471 (Fla. 5th DCA 2007); Solmo v. Friedman, 909 So. 2d
560, 564 (Fla. 4th DCA 2005). “However, no waiver occurs if the initial
motion to dismiss is amended to include the defense before the motion is
heard.” Re-Employment Servs., 969 So. 2d at 470-71 (citing Astra v. Colt
Indus. Operating Corp., 452 So. 2d 1031, 1032 (Fla. 4th DCA 1984)).
Appellees correctly assert that our decision in Astra guides our waiver
discussion in the instant case. In Astra, a third-party defendant filed a
motion to dismiss the third-party complaint, attacking the claim for
indemnification on the merits. Astra, 452 So. 2d at 1032. Five months
later, but before the initial motion was heard, the defendant filed an
amended motion to assert lack of personal jurisdiction. Id. We reversed
the trial court’s denial of the motion to dismiss and noted that the
defendant “did nothing in the litigation that could constitute a waiver of
its objection to personal jurisdiction other than its filing of the original
motion[] to dismiss” and so it would be “hypertechnical” to suggest that
the defendant waived the challenge by raising it in the amended motion
and not the original. Id. at 1032-33.
Similarly, Appellees in the instant action filed an initial motion to
dismiss based on statute of limitations and laches and then, before the
initial motion was ruled upon, filed an amended motion to dismiss based
on lack of personal jurisdiction. Although the amended motion was filed
over two years after the initial motion was filed, Appellees took no steps in
the proceedings that would amount to “submission to the court’s
jurisdiction” and lead to waiver of the right to challenge that jurisdiction.
See Solmo, 909 So. 2d at 564; Cumberland Software, Inc. v. Great Am.
Mortg. Corp., 507 So. 2d 794, 795 (Fla. 4th DCA 1987). The only steps
Appellees took in the case, aside from the motions to dismiss, were the
filing of the notice of intent to use trust funds to pay for attorneys’ fees
and their two responses to a discovery request by Appellant. Neither of
these actions would amount to “submission to the court’s jurisdiction,”1
1 While the dissent asserts that the filing of the notice of intent to use trust funds
to pay for attorneys’ fees is “akin to moving the court to grant a request materially
beneficial to them,” this assertion is incorrect where the notice was filed pursuant
to the statutory requirement in section 736.0802(10), Florida Statutes (2011).
Section 736.0802(10) provides for the payment of attorneys’ fees incurred in any
proceeding involving the trust from the assets of the trust “without the approval
of any person and without court authorization.” The exception is when the action
involves a breach of trust, as in the instant case. § 736.0802(10), Fla. Stat.
Where breach of trust is alleged against the trustee, “the trustee shall provide
written notice to each qualified beneficiary of the trust whose share of the trust
may be affected by the payment of attorney’s fees.” § 736.0802(10)(a). Once this
3
nor do they constitute requests for affirmative relief.2 See Brown v. U.S.
Bank Nat’l Ass’n, 117 So. 3d 823, 824 (Fla. 4th DCA 2013) (citing Babcock
v. Whatmore, 707 So. 2d 702, 704 (Fla. 1998)).
The cases Appellant offers in support of his waiver argument are all
distinguishable on the facts. In both Fiocchi v. Trainello, 566 So. 2d 904(Fla. 4th DCA 1990), and Zimmerman v. Weinberg, 557 So. 2d 193 (Fla.
4th DCA 1990), the defendants waived their challenges to personal
jurisdiction where they filed initial motions in the case without asserting
the defense, obtained a ruling on their motions, and then filed an amended
or subsequent motion asserting lack of jurisdiction for the first time.
Contra Re-Employment Servs., 969 So. 2d at 470-71. In Bailey, Hunt,
Jones & Busto v. Scutieri, 759 So. 2d 706, 708 (Fla. 3d DCA 2000), the
defendants waived any objection to personal jurisdiction because they had
sought affirmative relief through filing their own pleadings with the court
and had been actively litigating the case in federal court for three years
before asserting the jurisdictional challenge. In the instant case, Appellees
did not seek affirmative relief, nor did they receive a ruling on their initial
motion prior to their challenge to personal jurisdiction.
We therefore affirm the final order dismissing the case where Appellees
did not waive their challenge to personal jurisdiction and no error exists
notice is provided, the burden is on a party to the action to obtain a court order
to prohibit the trustee from paying for fees from trust assets. § 736.0802(10)(b).
As such, the notice was not requesting the court to take any action, much less
action materially beneficial to Appellees, where any action taken by the court in
response to the notice would be action on behalf of Appellant and would likely
not be beneficial to Appellees.
Nor can Appellees’ responses to Appellant’s discovery request be considered
conduct in submission to the court’s jurisdiction where Appellees were not the
parties seeking discovery in the proceedings and they were not requesting any
relief from the court related to the request. But see Markowitz v. Merson, 869 So.
2d 728, 729 (Fla. 4th DCA 2004) (finding waiver of a challenge to personal
jurisdiction where the defendant sought discovery in the proceedings before
asserting the claim of lack of personal jurisdiction); Joannou v. Corsini, 543 So.
2d 308, 311 (Fla. 4th DCA 1989) (finding a defendant waived his claim of lack of
personal jurisdiction where he “made an appearance and claimed rights under
the Florida Rules of Civil Procedure which are available to parties”).
2 “‘Affirmative relief’ has been defined as ‘relief sought by a defendant by raising
a counterclaim or cross-claim that could have been maintained independently of
the plaintiff's action.’” Empire Beauty Salon v. Commercial Loan Solutions IV, LLC,
39 Fla. L. Weekly D2381, at *4 (Fla. 5th DCA Nov. 14, 2014) (quoting BLACK'S LAW
DICTIONARY 1482 (10th ed. 2014)).
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with the trial court’s determination that it lacked personal jurisdiction over
Appellees.
Affirmed.
STEVENSON, J., concurs.
KLINGENSMITH, J., dissents with opinion.
KLINGENSMITH, J., dissenting.
In my view, Appellees waived their right to contest personal jurisdiction.
It is well-settled that lack of personal jurisdiction is a privileged defense
that can be waived “by failure to assert it seasonably, by formal
submission in a cause, or by submission through conduct.” Neirbo Co. v.
Bethlehem Shipbuilding Corp., 308 U.S. 165, 168 (1939); see also Leroy v.
Great W. United Corp., 443 U.S. 173 (1979).
As acknowledged by the majority, Appellees filed their notice of intent
to use trust funds to pay for attorneys’ fees, and participated in non-
jurisdictional discovery with Appellant. Appellees also responded to
Appellant’s interrogatory requests without appearing specially, and
without raising an objection or moving to stay the discovery before their
jurisdictional challenge was resolved. These actions, had they been
undertaken in this case, would be the type of defensive actions that would
not constitute a waiver of jurisdiction, as contemplated by Brown v. U.S.
Bank National Ass’n, 117 So. 3d 823, 824 (Fla. 4th DCA 2013). Similarly,
Appellees’ notice of intent to use trust funds to pay for fees, filed with the
court, is akin to moving the court to grant a request materially beneficial
to them, because the notice triggers the right to receive the fees absent an
objection by the opposing party. Therefore, it constitutes a submission to
jurisdiction. See First Wis. Nat’l Bank v. Donian, 343 So. 2d 943, 945 (Fla.
2d DCA 1977).
As such, this case is not like the situation presented in Astra v. Colt
Industries Operating Corp., where that defendant “did nothing in the
litigation that could constitute a waiver of its objection to personal
jurisdiction other than its filing of the original motion[] to dismiss.” 452
So. 2d 1031, 1032 (Fla. 4th DCA 1984).
As the Second District has previously noted, “Florida courts have
recognized various defenses that, when raised, do not waive personal
jurisdiction.” Faller v. Faller, 51 So. 3d 1235, 1237 (Fla. 2d DCA 2011)
(motion to stay due to similar lawsuit pending in another jurisdiction)
(citing Babcock v. Whatmore, 707 So. 2d 702, 704 (Fla. 1998) (motion for
5
relief from monetary judgments for child support arrearages)); Banco de
Costa Rica v. Rodriguez, 573 So. 2d 833, 834 (Fla. 1991) (motion to quash
a deposition subpoena); Parker v. George S. Heilpern, Trust, 637 So. 2d
295, 296 (Fla. 4th DCA 1994) (objection to codefendant's motion to share
in foreclosure proceeds); Cumberland Software, Inc. v. Great Am. Mortg.
Corp., 507 So. 2d 794, 795-96 (Fla. 4th DCA 1987) (answer and
compulsory counterclaim); Arch Aluminum & Glass Co. v. Haney, 964 So.
2d 228, 235 (Fla. 4th DCA 2007) (compulsory counterclaim); Two Worlds
United v. Zylstra, 46 So. 3d 1175 (Fla. 2d DCA 2010) (motion for section
57.105 attorney’s fees); Berne v. Beznos, 819 So. 2d 235, 237 (Fla. 3d DCA
2002) (answer and motions to dismiss and for summary judgment);
Heineken v. Heineken, 683 So. 2d 194, 197 (Fla. 1st DCA 1996) (request
in motion to dismiss that trial court order spouse to pay attorney’s fees
incurred in prosecuting the motion); Oy v. Carnival Cruise Lines, Inc., 632
So. 2d 724, 725 (Fla. 3d DCA 1994) (motion for protective order); Permenter
v. Fuertado, 541 So. 2d 1331, 1331 (Fla. 3d DCA 1989) (motion to stay
litigation pending appeal of denial of motion to vacate default and quash
service). Appellees’ actions are not analogous to any of these.
Cases from other jurisdictions have also held that defendants waive the
defense of lack of personal jurisdiction “by submission through conduct.”
See, e.g., Hamilton v. Atlas Turner, Inc., 197 F.3d 58 (2d Cir. 1999)
(defendant impliedly consented to personal jurisdiction of court by waiting
four years after filing answer to file motion to dismiss and participating in
extensive pretrial discovery); Cont’l Bank, N.A. v. Meyer, 10 F.3d 1293 (7th
Cir. 1993) (defendant waived defense of lack of personal jurisdiction by
participating in pretrial activities for two and a half years before raising
this defense); Datskow v. Teledyne, Inc., 899 F.2d 1298, 1303 (2d Cir.
1990) (court found defense of lack of personal jurisdiction waived by
defendant who participated in discovery and motion practice); Marcial
Ucin, S.A. v. S.S. Galicia, 723 F.2d 994, 997 (1st Cir. 1983) (court held
defendant waived defense of lack of personal jurisdiction because
defendant waited four years and attended thirteen depositions before
asserting the defense); Kearns v. Ferrari, 752 F. Supp. 749, 752 (E.D. Mich.
1990) (court found lack of personal jurisdiction defense waived because
defendants waited four years and one defendant filed a motion for partial
summary judgment before asserting the defense); In re Fin. Partners Class
Action, No. 82 C 6611 (N.D. Ill. Aug. 23, 1985) (court held defense of
personal jurisdiction waived because defendant participated in discovery,
filed discovery motions, attended status hearings and waited two years to
formally assert defense); Pearson v. Lake Forest Country Day Sch., 633
N.E.2d 1315, 1318 (Ill. App. Ct. 1994) (finding that defendant’s objection
to personal jurisdiction was waived when defendant raised substantive
defenses to claims and participated in discovery).
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In Florida, “a defendant waives a challenge to personal jurisdiction by
seeking affirmative relief,” but not by filing “a defensive motion seeking to
avoid the judgments.” Babcock, 707 So. 2d at 704-05; see also Faller, 51
So. 3d at 1236 (stating that “defending the case does not waive personal
jurisdiction” (citing Berne, 819 So. 2d at 238; Heineken, 683 So. 2d at
197)). The actions taken here by Appellees were not merely defensive in
nature, but instead indicate a willingness to submit to the jurisdiction of
the court through active litigation. See Bailey, Hunt, Jones & Busto v.
Scutieri, 759 So. 2d 706, 708 (Fla. 3d DCA 2000) (stating that “[t]he
longstanding rule in Florida has been that if a defendant files any pleading
to merits [sic] of the case the defendant waives all challenges to service of
process or jurisdiction”); Rates Tech. Inc. v. Nortel Networks Corp., 399
F.3d 1302, 1309 (Fed. Cir. 2005) (noting that “a party may consent to
personal jurisdiction by extensively participating in the litigation without
timely seeking dismissal”); PaineWebber Inc. v. Chase Manhattan Private
Bank (Switzerland), 260 F.3d 453, 459 (5th Cir. 2001) (acknowledging
“well-established rule that parties who choose to litigate actively on the
merits thereby surrender any jurisdictional objections”); Peterson v.
Highland Music, Inc., 140 F.3d 1313, 1318 (9th Cir. 1998) (“Most defenses,
including the defense of lack of personal jurisdiction, may be waived as a
result of the course of conduct pursued by a party during litigation.”).
To hold that the privilege of lack of personal jurisdiction may be
retained by an appearing defendant for over two years despite actively
engaging in non-jurisdictional discovery would be “subversive of orderly
procedure and make for harmful delay and confusion.” Cf. Commercial
Cas. Ins. Co. v. Consol. Stone Co., 278 U.S. 177, 180 (1929) (statement
made in relation to the privilege of venue). See Hunger U.S. Special
Hydraulics Cylinders Corp. v. Hardie–Tynes Mfg. Co., No. 99-4042, 2000
WL 147392, at *3 (10th Cir. Feb. 4, 2000) (unpublished) (“After its lengthy
participation in this litigation . . . [defendant] may not pull its personal
jurisdiction defense out of the hat like a rabbit.” (internal quotation marks
omitted)). Furthermore, similar to the cases of Spearman v. Sterling
Steamship Co., 171 F. Supp. 287 (E.D. Pa. 1959), and Vozeh v. Good
Samaritan Hospital, 84 F.R.D. 143 (S.D.N.Y. 1979), parties could be placed
at an unfair disadvantage if faced with the possibility that during any delay
the statute of limitations in the other jurisdiction might run, thereby
barring their claim should jurisdiction in this forum be successfully
challenged.
On these facts, I would reverse the trial court’s final order and find that
Appellees’ conduct was sufficiently dilatory and inconsistent with its
7
assertion of lack of in personam jurisdiction to constitute a waiver of the
defense.
* * *
Not final until disposition of timely filed motion for rehearing.
8