Frank Turk v. Joseph B. Holder, d/b/a Holder Tree Farms

FILED
October 15, 1999
Cecil Crowson, Jr.
Appellate Court Clerk
IN THE COURT OF APPEALS
AT KNOXVILLE
FRANK TURK ) HAMBLEN COUNTY
) 03A01-9811-CV-00381
Plaintiff-Appellant )
)
)
v. ) HON. JOHN K. WILSON,
) JUDGE
)
JOSEPH B. HOLDER, d/b/a )
HOLDER TREE FARMS )
)
Defendant-Appellee )
AFFIRMED AND REMANDED
PAUL G. WHETSTONE OF MORRISTOWN FOR APPELLANT
MARK A. COWAN OF MORRISTOWN FOR APPELLEE
O P I N I O N
Goddard, P.J.
Plaintiff Frank Turk appeals dismissal of his suit
against Joseph B. Holder, d/b/a Holder Tree Farms, because Mr.
Holder, a resident of Oregon, had insufficient contact with
the State of Tennessee to be amenable to service of process in
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this State.
The case below was disposed of by granting Mr. Holder
’s motion to dismiss, accompanied by his affidavit. Mr. Turk
filed a response to the motion, also supported by an affidavit.
The Trial Court held two hearings with regard to the
motion, the first on June 30, 1998, and the second on October
7, 1998. The transcript of the first hearing is not a part of
the record and the second is principally arguments by counsel,
plus several unsworn statements by Mr. Turk.
It appears that for the most part the facts
necessary for disposition of this appeal are undisputed.
Sometime prior to entering into a contract of purchase of
Christmas trees from Mr. Holder, Mr. Turk received a business
card from Mr. Holder in Arizona. He initiated the sale by
calling Mr. Holder in Oregon and received from Mr. Holder what
is described as a proposed order, together with a price list
of the trees to be sold. Mr. Turk ultimately decided that the
initial proposal, which was in the amount of $23,637.50, was
more than he chose to buy and ultimately bought fewer trees at
a price of $11,355. Mr. Turk borrowed $10,000 incident to the
purchase from a Tennessee bank and sent it to what he
described as a “partner” in New Mexico. The partner then
added to that amount $1355 to purchase the trees which were,
at Mr. Turk’s direction, shipped to Arizona. Upon inspection
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Mr. Turk found the trees to be defective and thereafter
brought the suit presently on appeal.
It has been held that T.C.A. 20-2-214(a)(6) extends
the personal jurisdiction of Tennessee courts to the limits
allowed by the United States Constitution. 1 In Gullett v.
Qantas Airways, Ltd., 417 F. Supp. 490 (M.D.Tenn.1975), the
Court ruled (at page 493):
The language of the statute is clear. There is no mention of
any “within the state” limitation in subsection (f) [now
subsection (6)], and one can only assume that it was the
intent of the legislature not to include such a restriction in
that subsection.
. . . .
[T]he clear language of the statute, its legislative history,
. . . convince this court that subsection (f) expands the
jurisdiction of Tennessee courts . . . to the full
constitutionally permissible limits.
This was reiterated by the Supreme Court of
Tennessee in the case of Masada Investment Corp. v. Allen, 697
S.W.2d 332 (Tenn.1985), in which the Court declared (at page
334):
Subsection (6) changed the long-arm statute from a “single act”
statute to a “minimum contacts” statute which expanded the
jurisdiction of Tennessee courts to the full limit allowed by
due process.
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Due process requires that a non-resident defendant
have a certain “minimum contacts” with the forum such that the
maintenance of the suit does not offend “traditional notions
of fair play and substantial justice.” International Shoe Co.
v. Washington, 326 U.S. 310, 66 S. Ct. 154 (1945). In the case
of Burger King Corp. v. Rudzewicz, 471 U.S. 462, 105 S. Ct.
2174 (1985), the Court stated that where a forum seeks to
assert “specific” jurisdiction over a non-resident, the
requirement that a defendant have “fair warning” that a
particular activity might subject him to jurisdiction in the
forum is satisfied if the defendant has “purposefully directed
his activities at residents of the forum, and the litigation
results from alleged injuries that “arise out of or relate to”
those activities. In sum, “parties who ‘reach out beyond one
state and create continuing relationships and obligations with
citizens of another State’ are subject to regulations and
sanctions in the other state for the consequences of their
activities.” Burger King, supra, citing Travelers Health Ass’n
v. Commonwealth of Virginia, 339 U.S. 643, 70 S. Ct. 927 (1950).
This Court, in Shelby Mut. Ins. Co. v. Moore, 645
S.W.2d 242 (Tenn. Ct. App. 1981), noted that three primary
factors are to be considered in determining whether the
requisite minimum contacts were present: the quantity of the
contacts, their nature and quality, and the source and
connection of the cause of action with those contacts. Two
lesser factors to be considered are the interest of the forum
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state and convenience. The Tennessee Supreme Court adopted
these factors in Masada Investment Corp. v. Allen, supra.
In this case we are of the opinion that Mr. Holder’s
contacts with Tennessee did not meet the minimum contacts
constitutionally required and that the Trial Court properly
refused to exercise jurisdiction. We say this because, as
already noted, any solicitation by Mr. Holder was made in the
State of Arizona and the contact involving Tennessee was made
by Mr. Turk. In response to Mr. Turk’s request, Mr. Holder
did send invoices and a price list to Mr. Turk, but the checks
2
in payment were sent from New Mexico and the trees delivered
to Arizona.
In reaching our conclusion we recognize that it is
for the most part, if not entirely, a subjective judgment, but
is one in which we are called upon to make and we believe is
appropriately made under the facts of this case.
For the foregoing reasons the judgment of the Trial
Court is affirmed and the cause remanded for collection of
costs below. Costs of appeal are adjudged against Mr. Turk
and his surety.
____________________________
Houston M. Goddard, P.J.
CONCUR:
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____________________________
Charles D. Susano, Jr., J.
____________________________
D. Michael Swiney, J.
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