Pascavage v. Can-Do, Inc.

Beasley, Judge.

Pascavage sued for fraud and unpaid commissions allegedly owed him by Can-Do, Inc., a Tennessee corporation, and its president George Holder, basing jurisdiction on the Georgia Long-Arm Statute (OCGA § 9-10-91). Can-Do and Holder were properly served and filed defensive pleadings. After initiating discovery, to which defendants failed to respond other than to request additional time, Pascavage moved for orders to compel discovery and for imposition of sanctions. Can-Do and Holder then filed a motion to dismiss attacking the long-arm jurisdiction, and the case was submitted for consideration on the record, including affidavits on both sides, and briefs. Pascavage appeals from the order granting defendants’ motion to dismiss and holding that his discovery motions were therefore moot.

The trial court was empowered by OCGA § 9-11-12 (d) to determine factual issues in regard to whether there had been minimum contact so as to authorize jurisdiction over defendants pursuant to OCGA § 9-10-91. Daughtry v. Chaney-Bush Irrigation, 166 Ga. App. 708 (1) (305 SE2d 439) (1983). Accord Ga. Power Co. v. Harrison, 253 Ga. 212 (2) (318 SE2d 306) (1984). It found that Can-Do was a corporation organized under the laws of Tennessee; that Holder was a resident of Tennessee; that the employment contract forming the subject matter of the complaint was negotiated and executed in Tennessee; and that Pascavage’s activity and authority in Georgia was limited to soliciting orders for defendants throughout the United States subject to approval in Tennessee. The court concluded that, based upon these facts, Can-Do and Holder were not “doing business” within the State of Georgia as contemplated by the provisions of the long-arm statute.

The law provides for jurisdiction over a non-resident “if in person or through an agent, he . . . transacts any business within this state . . .” OCGA § 9-10-91 (l).¹

In addition to what the trial court recited, the record reveals that the corporation commenced negotiations in this state of the contract out of which plaintiff’s employment and this lawsuit arose. It further shows that the very purpose for which plaintiff was employed by the defendant corporation was to transact business for the employer in Georgia and from Georgia as a base of operations of all parts of the continental United States. That is precisely what the agent of the corporation did, from 1977 to 1984, working out of his home in selling its products as an employee salesman. The corporation’s affidavit in effect states that 10% of the business conducted for it by plaintiff was in Georgia. There were at least two specific accounts in Georgia. In conducting its business here, the corporation through its agent Pascavage completed part of the processing of orders for sales, maintained and processed forms and records here, and stored and maintained inventory here.

Although defendant corporation tried to show that its employee merely solicited orders in Georgia, the contract of employment belies this distinction. He was hired as a “salesman” and the “nature of service” was, in the words of the contract prepared by employer, “as a travelling salesman in the employer’s business of selling . . . [specified products].” There is no provision that the orders were subject to approval by the employer such that it would therefore not be transacting business in Georgia.

If a third party were seeking to subject Can-Do to long-arm jurisdiction, we have no doubt the minimum contacts would be found based on its activities conducted through its agent Pascavage. Those same contacts lose no efficacy because the foreign corporation’s own Georgia-based employee is suing it for commissions earned in part by virtue of his work in Georgia on behalf of the corporation.

Storey v. Seffelaar & Looyen, Inc., 142 Ga. App. 873 (237 SE2d 236) (1977), on which defendants rely, is not controlling. There the court found insufficient contacts from solicitation in Georgia unaccompanied by local performance of contract obligations. Here, according to plaintiff’s unrebutted affidavit, the president and other employees came to Georgia over a period of several years regarding Can-Do’s business and the president was personally involved in handling two accounts in the Atlanta area. Moreover, this, together with the other factors mentioned above, brings this case within our holding in Brooks Shoe Mfg. Co. v. Byrd, 144 Ga. App. 431, 432 (2) (241 SE2d 299) (1977), where similar activity was found to show that “defendant purposely availed itself of the privilege of conducting business activities within Georgia.” The requirements set out in Coopers & Lybrand v. Cocklereece, 157 Ga. App. 240, 243 (1) (276 SE2d 845) (1981) were met.

Jurisdiction obtains, and the trial court is directed to consider the plaintiff’s motions regarding discovery and sanctions.

Judgment reversed with direction.

Banke, C. J., Deen, P. J., McMurray, P. J., Birdsong, P. J., Carley, Sognier, and Benham, JJ., concur. Pope, J., dissents.

1 For a general discussion of statutory long-arm jurisdiction, which perceives that “due process ... is the only limitation on jurisdiction,” see Shellenberger v. Tanner, 138 Ga. App. 399, 406 (1) (227 SE2d 266) (1976).