Opinion
No. CV 085019328
September 26, 2008
MEMORANDUM OF DECISION Motion to Dismiss (#102)
The defendant, Rodgers Finishing, an Indiana corporation moved to dismiss this action for lack of personal jurisdiction on June 12, 2008. The defendant argues that its contacts with Connecticut are so minimal as to deny jurisdiction to this court. The plaintiff opposes the motion in an Objection (#103) and Memorandum (#104) filed July 2, 2008, arguing that the Connecticut Longarm Statute is applicable to the defendant; the defendant consented to jurisdiction; and the defendant has sufficient contacts with Connecticut to satisfy the constitutional due process requirements. Oral argument was heard on July 28, 2008, at which time the court continued the case until September 22, 2008 in order for either party to present fact witnesses. On September 22, 2008, counsel for the defendant appeared to indicate on the record that the parties would rely on their submissions, including affidavits previously filed on July 2, 2008 (#105) and July 7, 2008 (#106). For reasons more fully set forth herein, this court denies the defendant's motion to dismiss.
There is no dispute that the defendant is an Indiana corporation whose only business dealings in Connecticut were with the plaintiff over a period of time from January 2006 through September 2007. The transactions at issue in the instant matter took place between June 2007 and September 2007. During the period between January 2006 and September 2007, the defendant placed orders for goods manufactured by the plaintiff, which the plaintiff shipped to the defendant for utilization in a larger component. The plaintiff shipped the goods F.O.B. Seller. Sometime around June 2007, the defendant notified the plaintiff that its product was defective. The defendant did not pay the plaintiff for the allegedly defective products that it received from June 2007 through September 2007.
Although there is no dispute that the parties entered an Agreement whereby the plaintiff would manufacture, sell and ship goods to the defendant, there is a dispute over whether any agents and/or employees of the defendant received plaintiff's "Terms and Conditions" which included a consent to the jurisdiction of the Courts of Connecticut. The plaintiff appends to its Objection an Affidavit of its President (#105), attesting that the plaintiff mailed to the defendant the Terms and Conditions of Sale. The Defendant filed an Affidavit of its President (#106) attesting that no employee of the defendant ever received a copy of the purported Terms and Conditions.
A motion to dismiss . . . properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court . . . A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction. (Internal quotation marks omitted.)
Cox v. Aiken, 278 Conn. 204, 210-11, 897 A.2d 71 (2006); see also Kozlowski v. Commissioner of Transportation, 274 Conn. 497, 501, 876 A.2d 1148 (2005); Filippi v. Sullivan, 273 Conn. 1, 8, 866 A.2d 599 (2005). Pursuant to Practice Book § 10-31(a),
a motion to dismiss shall be used to assert . . . (2) lack of jurisdiction over the person . . .
If a challenge to the court's personal jurisdiction is raised by a defendant, either by a foreign corporation or by a nonresident individual, the plaintiff must bear the burden of proving the court's jurisdiction.
Knipple v. Viking Communications, Ltd., 236 Conn. 602, 607, 674 A.2d 426 (1996).
[W]hen a motion to dismiss for lack of personal jurisdiction raises a factual question which is not determinable from the face of the record, the burden of proof is on the plaintiff to present evidence which will establish jurisdiction.
Reiner, Reiner Bendett, P.C. v. Cadle Co., 278 Conn. 92, 109, 897 A.2d 58 (2006).
A motion to dismiss may . . . raise issues of fact and would therefore, require a . . . hearing [to determine the facts] . . . [A]ffidavits are insufficient to determine the facts unless, like the summary judgment, they disclose that no genuine issue as to a material fact exists . . . In almost every setting where important decisions turn on questions of fact, due process requires an opportunity to confront and cross-examine witnesses. (Citations omitted; internal quotation marks omitted.)
Standard Tallow Corp. v. Jowdy, 190 Conn. 48, 56, 459 A.2d 503 (1983). Although affidavits are generally insufficient to establish facts, this court will decide issues presented by the motion based upon the Affidavits because both parties elected to rely upon them, declining the opportunity to present fact witnesses in-person, and because neither party opposed the court's consideration of them to determine facts.
It has been held that where a party agrees to join in the battle of affidavits, that party in effect consents to be bound by the resulting decision (subject, of course, to exercising his appellate rights). (Internal quotation marks omitted. Citations omitted.)
Rosenblit v. Danaher, 206 Conn. 125, 136, 537 A.2d 145 (1988).
The defendant argues that its minimal contacts with Connecticut preclude this court from exercising jurisdiction over it, apparently conceding that the Connecticut Longarm statute is applicable to it. The plaintiff argues not only that the Connecticut Longarm statute is applicable to the defendant, but that the defendant has consented to the jurisdiction of the Connecticut courts; and that even if it hasn't the defendant has sufficient contacts with Connecticut to satisfy the Due Process requirements
Ordinarily, "[w]hen a defendant challenges personal jurisdiction in a motion to dismiss, the court must undertake a two part inquiry to determine the propriety of its exercising such jurisdiction over the defendant. The trial court must first decide whether the applicable state Longarm statute authorizes the assertion of jurisdiction over the [defendant]. If the statutory requirements [are] met, its second obligation [is] then to decide whether the exercise of jurisdiction over the [defendant] would violate constitutional principles of due process." (Internal quotation marks omitted.) Cogswell v. American Transit Ins. Co., 282 Conn. 505, 514-15, 923 A.2d 638 (2007). Because the defendant is not challenging the applicability of the Longarm Statute, this court will not address that issue.
I.
Initially, this court addresses the issue of forum selection. Although not identified as such, by either party, this first issue is whether the parties entered an agreement that Connecticut courts, applying Connecticut law, would resolve any disputes between them. The plaintiff claims that the Terms and Agreements which it sent to the defendant, prior to the defendant's initial purchase of goods, contained a provision consenting to the jurisdiction of Connecticut. The defendant claims that it never received a copy of the Terms and Agreements. The Terms and Conditions, as appended to the Complaint and to the Affidavit of the plaintiff's President, state that the parties consent to the applicability of Connecticut law in Connecticut State Court. There is no dispute that the Terms and Agreements relied upon by the plaintiff are unsigned. Nor is there any dispute that there is no written acknowledgment from the defendant of receipt of the Terms and Conditions.
The existence of a forum selection clause neither requires the court to accept or reject jurisdiction. Rather, such clauses "present the question whether it is reasonable for the court to exercise jurisdiction in the particular circumstances of the case." Reiner, Reiner Bendett, P.C. v. The Cadle Co., supra 278 Conn. 101. However, "absent a showing of fraud, or overreaching, such forum clauses will be enforced by the courts." Id. n. 9.
This court finds that the plaintiff has failed to establish that the defendant received the Terms and Conditions which it claims to have mailed. In the face of the defendant's denial of receipt of the Terms and Conditions, the plaintiff has offered no proof of mailing. While the plaintiff's President attested that the document was mailed, "as it's normal, and standard business practice," he did not state that he was the employee responsible for the actual mailing. The plaintiff has not introduced into evidence an affidavit from the person who actually mailed the document; or a copy of a cover letter to the defendant referencing the purportedly mailed materials. And, the parties agree that there is no signed copy of the Terms and Conditions. Nor is there a signed contract or agreement between the parties acknowledging that they intend to be bound by the Terms and Conditions relied upon by the plaintiff. Accordingly, this court concludes that there is no applicable forum selection clause in effect in this case.
II.
The parties disagree about whether or not the defendant has sufficient minimum contacts with Connecticut in order to satisfy the constitutional due process requirements.
[T]he constitutional due process standard requires that, in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice . . . In other words, [t]he Due Process Clause protects an individual's liberty interest in not being subject to the binding judgments of a forum with which he has established no meaningful contacts, ties, or relations . . . By requiring that individuals have fair warning that a particular activity may subject [them] to the jurisdiction of a foreign sovereign . . . the Due Process Clause gives a degree of predictability to the legal system that allows potential defendants to structure their primary conduct with some minimum assurance as to where that conduct will and will not render them liable to suit . . .
Cogswell v. American Transit Ins. Co., 282 Conn. 505, 523-24, 923 A.2d 638 (2007).
The due process test for personal jurisdiction has two related components: the minimum contacts inquiry and the reasonableness inquiry. The court must first determine whether the defendant has sufficient contacts with the forum state to justify the court's exercise of personal jurisdiction. (Internal quotation marks omitted.)
Id., 524.
Thereafter,
[w]hile the exercise of jurisdiction is favored where the plaintiff has made a threshold showing of minimum contacts at the first stage of the inquiry, it may be defeated where the defendant presents a compelling case that the presence of some other considerations would render jurisdiction unreasonable. (Internal quotation marks omitted.)
Id., 525.
The [United States] Supreme Court has held that the court must evaluate the following factors as part of this reasonableness analysis: (1) the burden that the exercise of jurisdiction will impose on the defendant; (2) the interests of the forum state in adjudicating the case; (3) the plaintiff's interest in obtaining convenient and effective relief; (4) the interstate judicial system's interest in obtaining the most efficient resolution of the controversy; and (5) the shared interest of the states in furthering substantive social policies. (Internal quotation marks omitted.)
Panganiban v. Panganiban, 54 Conn.App. 634, 640, 736 A.2d 190, cert. denied, 251 Conn. 920, 742 A.2d 359 (1999).
As our Supreme Court has explained,
[t]he application of that rule [of minimum contacts] will vary with the quality and nature of the defendant's activity, but it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws. This purposeful availment requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts . . . or of the "unilateral activity of another party or a third person . . ." (Internal quotation marks omitted.)
Cogswell v. American Transit Ins. Co., supra 282 Conn. 530.
While the defendant fails to cite any factually analogous or applicable case law regarding its minimum contacts with Connecticut, the plaintiff relies principally upon Richardson Company v. Rotuba Extruders, Inc., 36 Conn.Sup. 262 (1980). In Richardson, the court (DuPont, J.) concluded that the defendant, a New York corporation, has sufficient contacts with Connecticut for Connecticut courts to exercise jurisdiction over it. The court relied on the fact that "the goods were manufactured in Connecticut, that the defendant has had other business contacts with Connecticut, that invoices to the defendant were labeled `F.O.B. point of origin,' and that the plaintiff sent confirmation of the orders by mail to the defendant." (Emphasis added.) Id. at 263.
Like the defendant in Richardson, the defendant in the instant matter is a foreign corporation. Like the defendant in Richardson, the defendant in the instant matter transacted business with the plaintiff over a period of time, specifically over a 20-month period. As in Richardson, the goods were shipped F.O.B. seller. Unlike in Richardson, there is no evidence that the defendant engaged in any other business in Connecticut other than with the plaintiff. So, the question is, are the transactions that took place between the parties, alone, sufficient to establish minimal contact with this state?
"The twin touchstones of due process analysis under the minimal contacts doctrine are foreseeability and fairness." U.S. Trust Co. v. Bohart, 197 Conn. 34, 41, 495 A.2d 1034 (1985). Therefore, the question before this court is: was it foreseeable to the defendant that it might be haled into Connecticut Court for failing to pay the bills of the plaintiff, the manufacturer of goods from whom it ordered a series of parts? The court answers this question affirmatively. The transaction in the instant matter was not an isolated or single purchase. Rather it was a series of purchases, over a period of time, that had been specifically negotiated by the parties. The defendant knew that parts would be manufactured in Connecticut by a Connecticut company, and then shipped from Connecticut for its benefit and use.
Given that this court concludes that it was reasonably foreseeable to the defendant that it would be haled into Connecticut courts, the next question is: would it be fair to require the defendant to litigate this matter in Connecticut? Again this court answers the question in the affirmative. Although, it will certainly be more inconvenient to the defendant to litigate the debt collection claim in Connecticut than in Indiana, doing so will not cause inequity or unfairness. The burden imposed upon the defendant is not unduly harsh. And, Connecticut courts have an interest in adjudicating the instant matter which involves a contract which was performed here. The plaintiff certainly has a compelling interest in obtaining relief here. And, at present, Connecticut provides the most efficient resolution of this controversy, as there are no other claims or pending actions in this state or in any other states.
The defendant refers to claims of defective products. Those claims are not before this court, have not yet been filed in any court, and are not properly considered. The argument that the plaintiff produced defective products does not, on its own, meet the defendant's burden of making a compelling case that the presence of other considerations would render jurisdiction in Connecticut unreasonable. Accordingly, this court denies the defendant's motion to dismiss.
In his affidavit, the defendant's President says that "Plaintiffs (sic) were put on notice that the product was defective." Further, in its Memorandum in Support of its Motion to Dismiss, the defendant argues that "faced with the understanding that it faced litigation in Indiana due to its own breach of contract, plaintiff seeks to divert this litigation to Connecticut."