INTER-NATION CAPITAL MANAGEMENT CORP. (PANAMA), S.A. VS. METRO COUNTRY CLUB, S.A. (C-000054-17, ESSEX COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0300-17T4
INTER-NATION CAPITAL
MANAGEMENT CORP. (PANAMA),
S.A., STATIOL INC., S.A.,
INTER-NATION CAPITAL GROUP,
INC. and JOHN KELLENYI,
Plaintiffs-Respondents,
v.
METRO COUNTRY CLUB, S.A.,
MEDIA GLOBAL FINANCE LTD. and
LUIS JOSE ASILIS,
Defendants-Appellants.
_______________________________
Argued February 5, 2018 - Decided July 13, 2018
Before Judges Accurso, Vernoia and
DeAlmeida.
On appeal from Superior Court of New Jersey,
Chancery Division, Essex County, Docket No.
C-000054-17.
Jorge A. Mestre (Rivero Mestre LLP) of the
Florida bar, admitted pro hac vice, argued
the cause for appellants (Bertone Piccini,
LLP, and Jorge A. Mestre, attorneys;
Cristina Z. Sinclair and Marc W. Garber, of
counsel; Jorge A. Mestre and Amanda M.
McGovern (Rivero Mestre LLP) of the Florida
bar, admitted pro hac vice, of counsel and
on the briefs; Daniel Alvarez Sox (Rivero
Mestre LLP) of the Florida bar, admitted pro
hac vice, on the briefs).
Michael J. Geraghty argued the cause for
respondents (Sills Cummis & Gross PC,
attorneys; Michael J. Geraghty, of counsel
and on the brief; Kenneth F. Oettle, on the
brief).
PER CURIAM
Defendants Metro Country Club, Media Global Finance and
Luis Asilis appeal on leave granted from the Chancery Division's
denial of their motion to dismiss the complaint filed by
plaintiffs Inter-Nation Capital Management Corp. (Panama),
Statiol Inc., Inter-Nation Capital Management Group and John
Kellenyi for lack of personal jurisdiction. We affirm,
substantially for the reasons expressed by Judge Kessler in his
cogent and comprehensive opinion from the bench on July 21,
2017.
Metro Country Club is a residential golf club community in
the Dominican Republic, organized under the laws of that
country. Asilis, a citizen of the Dominican Republic, is
president of Metro and its subsidiary, Media Global Finance, a
company devoted to developing and operating residential
communities and resorts in the Dominican Republic. Media Global
is organized under the laws of the British Virgin Islands,
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although its principal place of business is in the Dominican
Republic.
In February 2012, Asilis called Alberto Fernandez in his
office in Maplewood looking for financing. The two met when
Fernandez, a New Jersey resident, purchased a vacation home in
Metro in 2000 and told Asilis he did financial advising and
consulting internationally through his New Jersey companies.
When Fernandez said he was interested, Asilis told him Carlos
Cortina, Metro's chief financial officer, would call him to
discuss particulars.
Cortina called Fernandez at his Maplewood office,
explaining that Metro had a multi-million dollar loan,
guaranteed by Media Global, coming due in a few weeks' time.
Metro and Media Global needed financing to pay off the loan or
have the loan and collateral assigned to a new lender.
Fernandez agreed to solicit investors through his investment
consulting business, Inter-Nation Capital Management Group, a
New Jersey corporation, for a fee payable on the closing of the
transaction, conditioned on the loan being enforceable in the
United States.
Fernandez solicited Statiol Inc., S.A., a Panamanian
company having a principal place of business in Chile and John
Kellenyi, another Maplewood resident, as investors, along with
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Inter-Nation Capital Management Corp., a Panamanian corporation
with its principal place of business in Maplewood, which is a
wholly-owned subsidiary of Inter-Nation Capital Management
Group, formed to hold Fernandez's personal investments. Cortina
traveled to New Jersey to meet with Fernandez in the Inter-
Nation offices in Maplewood. Cortina advised Fernandez that
Metro was working on long-term financing from IVO Capital
Partners, an international investment firm. Cortina explained
Metro and Media Global needed approximately $4 million in bridge
financing only until the IVO financing was in place. Fernandez,
acting on behalf of Statiol, Kellenyi and Inter-Nation Capital
Management Corp., began negotiating the terms of a loan purchase
and refinancing with Cortina.
In March, Asilis and Fernandez negotiated the terms of the
bridge loan from Statiol, Kellenyi and Inter-Nation Capital
Management Corp., acting as an informal lending group, to Metro,
guaranteed by Media Global and secured by various collateral
through a series of phone calls and email messages to Fernandez
in New Jersey. Asilis assured Fernandez in the course of those
negotiations that Metro had a firm commitment for long-term
financing from IVO to close in 2013 and was only seeking bridge
financing from the lending group. Based on Asilis'
representation, the three-member lending group agreed to loan
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Metro $6 million, $4 million to purchase Metro's outstanding
loan and the remainder to refinance a commercial paper
obligation and fund working capital.
The lending group took an assignment of the loan and
collateral documents and entered into a "Frame Agreement" with
Metro amending the prior loan documents and increasing the
principal amount of the loan to $6 million (later increased to
$6.5 million), subject to Metro's delivery of three promissory
notes to the lending group. The Frame Agreement is expressly
governed by New Jersey law and was executed by Fernandez and
Kellenyi in New Jersey.
Metro eventually defaulted on the payments, although not
before making certain payments required under the loan documents
by wire transfer to various banks in the United States,
including to Inter-Nation Capital Management Corp. to Valley
National Bank in Maplewood. Fernandez contends Cortina admitted
after the default that Metro had not had a firm commitment for
long-term financing from IVO as Asilis had assured Fernandez
before the lending group committed to making the loan and could
not pay the lending group what it was owed without such
financing. Notwithstanding that the lending group entered into
a standstill agreement with Metro and Media Global agreeing to
forbear payment on the outstanding aggregate amount then due and
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owing of $7,896,111.14 for eighteen months in order to permit
Metro and Media Global to obtain other financing, Metro
ultimately defaulted on that agreement as well, resulting in the
complaint plaintiffs filed in the Chancery Division for specific
performance of Metro's obligations to produce books and records,
as well as for breach of contract against both Metro and Media
Global and fraud against both those defendants and Asilis.
Defendants moved to dismiss the complaint, arguing they
have no contacts with New Jersey. Specifically, defendants
contended the properties, businesses, collateral and the
business interests at issue in the litigation are in the
Dominican Republic. They argued they made no "purposeful foray"
into New Jersey, as that term was defined in Bayway Refining Co.
v. State Utilities, Inc., 333 N.J. Super. 420, 431 (App. Div.
2000), and instead that the dispute arose following plaintiffs'
contacts and purposeful investment in the Dominican Republic.
Judge Kessler rejected those arguments. Applying the test
of Waste Management v. Admiral Insurance Co., 138 N.J. 106, 122
(1994), the judge had no hesitation in finding defendants had
sufficient minimum contacts to establish specific jurisdiction
in New Jersey. The judge found Asilis initiated the loan
agreement between Metro and Media Global and defendants when he
telephoned Fernandez in New Jersey to seek financing, rejecting
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defendants' claim that Fernandez initiated the contact by
marketing his ability to obtain investors and financing to Metro
in 2000.
The judge also rejected defendants' argument that their
contacts with New Jersey were only incidental to Fernandez's
unilateral decision to be in New Jersey, instead of his domicile
in the Dominican Republic, when he was negotiating the loan in
February 2012. The judge was unpersuaded by the fact that
Fernandez owned a vacation home and may have maintained a second
domicile in the Dominican Republic. Defendants did not dispute
that Fernandez was a New Jersey resident when they solicited him
in New Jersey. More important, they followed-up that contact by
sending Cortina to New Jersey to meet with Fernandez to obtain
investors, one of whom, Kellenyi, they knew resided in New
Jersey. Defendants thereafter continued the negotiations
through telephone and email directed to Fernandez in New Jersey,
leading to an agreement governed by New Jersey law.
Considering the extent and variety of their contacts, the
judge was satisfied defendants purposefully availed themselves
of the State's benefits and "should 'reasonably anticipate being
haled into court [in the forum state].'" Bayway Ref. Co., 333
N.J. Super. at 429 (quoting World-Wide Volkswagen Corp. v.
Woodson, 444 U.S. 286, 297 (1980)). Judge Kessler found
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defendants, as the Florida boat seller in Lebel v. Everglades
Marina, Inc., 115 N.J. 317, 320-22 (1989), obtained a
significant benefit, here bridge financing of over $6 million,
by soliciting a New Jersey resident, in New Jersey, to obtain
the money. Judge Kessler reasoned that in reaching into New
Jersey for the loan, defendants "impliedly understood that they
could be haled into a New Jersey court" in the event they failed
to repay it. The judge found Asilis' allegedly false statement
about the IVO loan commitment made to induce plaintiffs to make
the loan likewise satisfied the test for minimum contacts. See
id. at 326 ("Where a defendant knowingly sends into a state a
false statement, intending that it should then be relied upon to
the injury of a resident of that state, he has, for
jurisdictional purposes, acted within that state.") (quoting
Vishay Intertechnology, Inc. v. Delta Int'l Corp., 696 F.2d
1062, 1066 (4th Cir. 1982)).
Judge Kessler further found suit in New Jersey would "not
offend 'traditional notions of fair play and substantial
justice.'" Waste Mgmt., 138 N.J. at 120 (quoting World-Wide
Volkswagen, 444 U.S. at 292). He found New Jersey certainly had
an interest in carrying out its law and protecting those
residents who lend funds in good faith, which outweighed any
inconvenience to defendants in litigating in New Jersey,
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particularly where defendants had already sent a representative
to the State in connection with the loan.
Defendants appeal, reprising the arguments they made to the
trial court and adding the court erred in exercising personal
jurisdiction over Media Global as the court failed to make any
findings of fact specific to that entity to establish its
minimum contacts with New Jersey.
Our review of the record convinces us that none of those
arguments is of sufficient merit to warrant discussion in a
written opinion. R. 2:11-3(e)(1)(E). There is no question but
that "[t]he requirements of minimum contacts analysis 'must be
met as to each defendant over whom a state court exercises
jurisdiction.'" Waste Mgmt., 138 N.J. at 127 (quoting Rush v.
Savchuk, 444 U.S. 320, 332 (1980)). Here, however, the record
makes very apparent both Asilis and Cortina were acting on
behalf of both Metro and Media Global its wholly owned
subsidiary and guarantor of the loan to be refinanced. The
judge highlighted those facts in his opinion. Accordingly, we
find any failure by the judge to specifically mention Media
Global as he was summing up his findings to be of no moment.
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We affirm, substantially for the reasons expressed in Judge
Kessler's clear and comprehensive opinion from the bench on July
21, 2017.
Affirmed.
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