Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County, Jon Mayeda, Judge, Los Angeles County Super. Ct. No. BC338168
Law Offices of Robert A. Brown and Robert A. Brown; Lyle F. Middleton for Plaintiff and Appellant.
Monteleone & McCrory and Scott R. Lane for specially appearing Defendants and Respondents Summers Properties, LLC and David Spigle.
Knapp, Petersen & Clarke and Robert D. Brugge for Defendants and Respondents E. Dickson Watts and Abacus Mortgage.
Manning & Marder Kass, Ellrod, Ramirez, Fredric W. Trester, David Gorney and Darin L. Wessel for specially appearing Defendants and Respondents Michelle L. Patrick and All Star Realty, LLC.
MANELLA, J.
Appellant Nancy Fox appeals from orders quashing service of her underlying action on respondents, six Virginia residents, based on lack of personal jurisdiction. We conclude that with respect to two of the respondents -- Michelle Patrick and All Star Realty, LLC, doing business as Remax All Stars (Remax) -- sufficient minimum contacts existed to support personal jurisdiction. The other four respondents -- E. Dickson Watts, his company Abacus Mortgage, a fictitious name for Phoenix Financial Corporation, a Virginia corporation (Abacus), David Spigle, and Spigle’s company Summers Properties, LLC., a Virginia limited liability company -- lack such contacts. We therefore, reverse in part and affirm in part.
Patrick and Remax are jointly referred to herein as “Patrick/Remax.”
Spigle and his company are jointly referred to herein as “Spigle/Summers.”
PROCEDURAL BACKGROUND
Fox owned a mobile home park in Desert Hot Springs, California (the California property). In 2004, she entered into an agreement to sell the California property to a California company and a separate agreement to purchase a Virginia property from Spigle/Summers, as part of a three-way, tax-free exchange. Just prior to the closing, Fox became concerned that the California property had been undervalued by her realtors and other advisors, and that the Virginia property had been similarly overvalued. At approximately the same time, she learned that the company that had contracted to purchase the California property was owned by a relative of her realtor. Fox contacted an attorney and tried to halt the transfer of funds, but was unsuccessful, in part due to a threatening letter sent to the escrow company by the broker handling the sale of the Virginia property.
Internal Revenue Code section 1031(a)(1) permits a party to exchange real estate held for productive use in a trade or business for another “like-kind” property and avoid recognition of capital gains. In addition, “[u]nder certain conditions, a taxpayer’s nonsimultaneous transfer and receipt of like-kind properties may qualify for section 1031 treatment, provided generally that the [property owner] identifies the new property within 45 days and receives it within 180 days of transferring the old property. [Citation.]” (Teruya Bros., Ltd., & Subs. v. Commissioner (2005) 124 T.C. 45, 50.) To facilitate such an exchange, the property owner generally “use[s] a qualified intermediary; i.e., a person who is not the [property owner], an agent of the [property owner], a related person to the [property owner], or a related person to an agent of the [property owner], [citation], who enters into a written exchange agreement with the [property owner] and, as required by this agreement, acquires property from the [property owner], transfers this property, acquires like-kind replacement property, and transfers this replacement property to the [property owner]. [Citation.]” (Ibid.)
After escrow closed, Fox brought suit against 13 parties: (1) Hacienda Escrow, the California escrow company handling the California transaction; (2) Hacienda Escrow’s employee, Lisa Pavlatos; (3) Elizabeth Ann Prine, the listing agent for the California property; (4) National Credit Industries, Inc., doing business as Century 21 Americana, a California corporation (Century 21), the company by which Prine was employed as an associate broker; (5) Oscar Rodriguez, Prine’s husband who was also employed by Century 21; (6) Richard Rodriquez, O. Rodriquez’s brother and Prine’s brother-in-law, whose company purchased the California property; (7) Whispering Sands MHE, LLC, a California limited liability company, R. Rodriguez’s company; (8) Watts, Fox’s romantic partner who had acted as the intermediary for purposes of the section 1031 exchange; (9) Abacus, owned by Watts; (10) Patrick, a Virginia real estate broker and dual agent for the purchase and sale of the Virginia property; (11) Remax, a brokerage owned by Patrick; (12) Spigle; and (13) Summers Properties, Spigle’s company.
The first three causes of action for breach of escrow instructions, breach of fiduciary duty, and professional negligence were addressed to California residents Hacienda Escrow, Pavlatos, R. Rodriguez, and Whispering Sands. The fourth cause of action asserted a separate claim for breach of fiduciary duty against Prine, Century 21, O. Rodriquez, Watts, Abacus, Patrick/Remax, and Spigle/Summers. It alleged that Prine, O. Rodriguez, Watts, and Patrick misrepresented to Fox the fair market value of the California Property and that Watts, Patrick, and Spigle misrepresented to Fox the fair market value of the Virginia property. It also asserted that Prine, O. Rodriguez, Watts, Patrick, and Spigle overrode Fox’s attempt to cancel escrow on the California property and that Watts ignored Fox’s instructions by using the sales proceeds to purchase the Virginia property. The fifth and sixth causes of action, asserting claims for intentional and negligent misrepresentations regarding the value of the California and Virginia properties, named the same defendants: Prine, Century 21, O. Rodriquez, Watts, Abacus, Patrick/Remax, and Spigle/Summers.
The seventh and eighth causes of actions asserted claims for intentional and negligent misrepresentation for failing to disclose various relationships between the parties, including the familial relationship between Prine, O. Rodriquez, and R. Rodriquez, and named Prine, Century 21, O. Rodriquez, R. Rodriquez, Whispering Sands, Patrick (but not Remax), and Watts (but not Abacus). The ninth and final claim, for negligence, named the same defendants: Prine, Century 21, R. Rodriquez, Whispering Sands, Patrick, and Watts. It claimed that these defendants, with the exception of Whispering Sands, negligently failed to exercise the skill, care and diligence required by professional real estate brokers, mortgage brokers and trustees, by failing to disclose the relationships between the parties.
After Fox filed proofs of service indicating service of the complaint on all defendants, respondents appeared specially, filing three separate motions to quash service and contest personal jurisdiction. Their motions were granted by the trial court by orders dated December 1 and December 5, 2005. This appeal followed.
The facts are derived from the declarations and exhibits filed in support of and in opposition to the motions to quash.
In 2004, Fox was involved in a romantic relationship with Watts, a Virginia resident. At all relevant times, Fox owned a residence in Virginia where she lived “when the weather . . . was warm.” Sometime during the spring of 2004, real estate agent Prine personally called on Fox while Fox was in California, in an attempt to obtain a listing on the California property. Using information supplied by Fox and Watts, Prine evaluated the property at $1.2 million. At first, Fox was not interested in selling, but Watts pressured her by telling her interest rates were going up, the value of the California property was going down, and ownership of the property was causing a problem with her taxes. These conversations took place in California. Shortly thereafter, the couple traveled to Virginia where they met with Patrick and discussed selling the California property and buying another property as part of a three-way, tax-free exchange. Watts sent Fox to meet with an accountant who confirmed that Fox’s taxes were “messed up” in some way having to do with ownership of the California property. At approximately the same time, Watts persuaded Fox that, based on calculations he had made, the property was worth only $960,000.
This was according to Patrick’s declaration. Fox’s declaration stated she had a home in Virginia, but did not say whether she lived there year-round or whether she spent any significant amount of time in California.
According to Fox, while she and Watts were in California in the spring of 2004, Watts contacted Patrick to discuss selling the California property, and Patrick referred them to Prine. According to Patrick, she and Watts knew each other because their companies occupied the same building in Virginia, and she first heard about Fox and the California property during a conversation that occurred in Watts’s Virginia office. Later, she was introduced to Fox by Watts in Virginia.
According to Fox, Patrick brought up the idea of engaging in a tax-free exchange. According to Patrick, by the time she met Fox, Fox had already decided to sell the California property and obtain another property as part of a tax-free exchange.
On July 2, 2004, Fox entered into a listing agreement with Prine and Century 21 containing a listing price of $950,000. The agreement had been faxed to Fox at Patrick’s Virginia office and was signed by Fox there. Shortly after the listing agreement was signed, Prine faxed an $875,000 offer from Whispering Sands to Fox through Patrick/Remax. Subsequently, Prine faxed a proposed counteroffer for $940,000 to Fox through Patrick/Remax for review. Fox agreed to submit the proposed counteroffer, and Whispering Sands accepted it. Prine’s congratulatory message was faxed to “Nancy, Dickson and Micki” at two different numbers, one of which was Patrick/Remax’s and the other Watts’s. Thereafter, communications about the sale and paperwork to conclude the deal continued to flow to Fox from Prine or Century 21 in California through Patrick/Remax and/or Watts in Virginia.
Although not entirely clear from the record, we presume this was the office from which Patrick operated Remax. The fax was addressed to “Nancy Fox/Micki.” “Micki” is Patrick’s nickname. Fox contended that Watts and Patrick advised her to sign the listing agreement, telling her it was in her “best interests.”
The fax was addressed to “Nancy, Dickson and Micki.” The fax described Whispering Sands as a “very qualified and motivated client” but said nothing about the relationship of its principal, R. Rodriguez, to Prine.
This fax was also addressed to “Nancy, Dickson and Micki.”
According to Fox, she discussed the offer with Patrick and Watts in Patrick/Remax’s offices before countering, and they told her it would be a mistake not to sell.
Occasionally fax transmissions about the transaction were addressed to Patrick/Remax alone. One transmission was directed to Watts alone. In it, Prine asked him to procure Fox’s signature on some documents and thanked him “for all [his] help.” According to Fox, Watts and Patrick advised her with respect to the sale throughout this period. Fox believed Patrick was representing her and “looking after [her] interests” because she had been told “[Patrick] was to receive a percentage of the sales commission on the [California property].” According to Patrick, neither she nor Remax “were engaged in any aspect of the California transaction” and she “did not offer any advice to [Fox] on the value of, or any other aspect of, the California property . . . .” Watts admitted “discuss[ing] the subject properties” with Fox in the context of their “personal relationship,” but denied deriving any “benefit, financial or otherwise, directly or indirectly, from any of the transactions.”
After the agreement to sell the California property was signed, Patrick informed Fox and Watts that she had discovered a potential property in Virginia suitable for a tax-free exchange, viz., the property owned by Spigle/Summers. In October 2004, Fox signed a purchase agreement to acquire the Virginia property for $960,000, as part of a tax-free exchange transaction. Patrick/Remax acted as dual agent, that is, it represented both the seller of the Virginia property and Fox, the prospective purchaser. Watts agreed to act as the exchange intermediary, a role he assumed without expectation of payment. He set up a bank account in Virginia to receive the funds, naming himself as trustee of the account.
Shortly before escrow closed, Fox learned that Whispering Sands was owned by R. Rodriguez and that he was Prine’s brother-in-law. She began to fear that something was amiss and consulted an attorney, Lyle Middleton. Middleton advised Fox to send a telegram to Hacienda Escrow to cancel the escrow. Fox purportedly did so on November 20, 2004. In addition, Middleton sent Hacienda Escrow a letter dated November 20, 2004, instructing Hacienda Escrow to cancel escrow and refrain from distributing funds and transferring title because “Ms. Fox has reason to believe that she has been defrauded in this matter.”
For reasons not made clear in the parties’ declarations, Fox’s attempt to cancel escrow on the California property failed. However, Hacienda Escrow temporarily refrained from transmitting the funds derived from the sale to the bank account set up to purchase the Virginia property. On November 24, 2004, Patrick sent a letter on Remax stationery to Hacienda Escrow, stating: “I am acting as Dual Agent for a commercial transaction involving Nancy Lee Fox that was scheduled to close on Friday, November 19. The only contingency for this particular transaction was that the [California property] (that you are handling) close. We were advised that the closing did in fact occur last week. [¶] There is no reason for funds to be delayed. We cannot close on the commercial transaction in Virginia until funds are received from Nancy’s sale in California. We expect the funds to be sent today. Any further delay will result in legal action.” After receiving the letter, Hacienda Escrow transferred the funds to the bank account previously set up by Watts in his role as exchange intermediary. From there, in accordance with instructions given when the account was opened, the bank forwarded the funds to the agent for Spigle/Summers.
Watts stated in his declaration that escrow “closed” on or about November 19, 2004. However, it is not clear what he meant by that term. There is no dispute that no funds were transferred out of escrow until after November 24. (See Kelly v. Steinberg (1957) 148 Cal.App.2d 211, 217-218 [discussing the transfer of funds that is part of the traditional “close” of escrow].)
DISCUSSION
The issue on appeal is whether the trial court erred in determining that respondents lacked sufficient contacts with California to support personal jurisdiction. We conclude that under California’s long-arm statute, Patrick and Remax are subject to suit in this state, but Watts, Abacus, Spigle and Summers are not.
I
California’s Long-Arm Statute
California’s long-arm statute, Code of Civil Procedure section 410.10, “authorizes California courts to exercise jurisdiction on any basis not inconsistent with the Constitution of the United States or the Constitution of California.” (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 444.) In general, assertion of personal jurisdiction over a nonresident defendant “comports with the requirements of the due process clause of the federal constitution if the defendant has such minimum contacts with the state that the assertion of jurisdiction does not violate “‘“traditional notions of fair play and substantial justice.”’” (Ibid., quoting International Shoe Co. v. Washington (1945) 326 U.S. 310, 316.) “If the nonresident defendant does not have substantial and systematic contacts in the forum sufficient to establish general jurisdiction, he or she still may be subject to the specific jurisdiction of the forum, if the defendant has purposefully availed himself or herself of forum benefits [citation], and the ‘controversy is related to or “arises out of” a defendant’s contacts with the forum.’” (Id. at p. 446, quoting Helicopteros Nacionales de Columbia v. Hall (1984) 466 U.S. 408, 414.)
Here, Fox seeks to establish specific jurisdiction over respondents based on limited contacts with California and a controversy related to or arising out of those contacts. A nonresident has sufficient contacts to support specific jurisdiction if he or she “has ‘purposefully directed’ his or her activities at forum residents (Burger King [Corp. v. Rudzewicz (1985) (Burger King)] 471 U.S. [462,] 472 . . . )[;] . . . ‘purposefully derived benefit’ from forum activities (id. at p. 473 . . . )[;] or ‘“purposefully avail[ed himself or herself] of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.”’” (Id. at p. 475 . . . .)” (Vons Companies, Inc. v. Seabest Foods, Inc., supra, 14 Cal.4th at p. 446.) A nonresident meets this test and may be subject to jurisdiction in California if he or she “commits a tort or . . . causes a tort to be committed within this state” or “expressly aim[s] or target[s] . . . tortious conduct at our state.” (In re Automobile Antitrust Cases I & II (2005) 135 Cal.App.4th 100, 122-123.) Foreseeability that one’s actions may cause injury in another State “‘is not a “sufficient benchmark” for exercising personal jurisdiction.’” (Pavlovich v. Superior Court (2002) 29 Cal.4th 262, 272, quoting Burger King, supra, 471 U.S. at p. 474.) “Rather, ‘the foreseeability that is critical to due process analysis . . . is that the defendant’s conduct and connection with the forum State are such that he [or she] should reasonably anticipate being haled into court there.’” (29 Cal.4th at p. 272, quoting World-Wide Volkswagen Corp. v. Woodson (1980) 444 U.S. 286, 297.)
Once it has been determined that a defendant “‘purposefully established minimum contacts within the forum State,’” the court must still consider whether exercise of jurisdiction is reasonable, that is, “‘whether the assertion of personal jurisdiction would comport with “fair play and substantial justice.”’” (Vons Companies, Inc. v. Seabest Foods, Inc., supra, 14 Cal.4th at p. 447, quoting Burger King, supra, 471 U.S. at p. 476.) Factors that are evaluated in making this determination include “the burden on the defendant of appearing in the forum, the forum state’s interest in adjudicating the claim, the plaintiff’s interest in convenient and effective relief within the forum, judicial economy, and ‘the “shared interest of the several States in furthering fundamental substantive social policies.”’” (Vons Companies, Inc. v. Seabest Foods, Inc., supra, 14 Cal.4th at p. 448, quoting Burger King, supra, 471 U.S. at p. 477.)
II
Burden of Proof and Standard of Review
“When a defendant moves to quash service of process on jurisdictional grounds, the plaintiff has the initial burden of demonstrating facts justifying the exercise of jurisdiction. [Citation.]” (Vons Companies, Inc. v. Seabest Foods, Inc., supra, 14 Cal.4th at p. 449.) “The plaintiff need not prove the truth of the allegations constituting the causes of action in order to justify an exercise of jurisdiction over nonresident parties, but the plaintiff must ‘present facts demonstrating that the conduct of defendants related to the pleaded causes is such as to constitute constitutionally cognizable “minimum contacts.” [Citation.]’ [Citation.]” (Edmunds v. Superior Court (1994) 24 Cal.App.4th 221, 228.) “‘If there is any conflict in the affidavits, those in favor of the prevailing party must be taken as true, and the facts stated therein must be considered established.’” (Chronometrics, Inc. v. Sysgen, Inc. (1980) 110 Cal.App.3d 597, 603, quoting Fuller v. Lindenbaum (1938) 29 Cal.App.2d 227, 230.)
Respondents objected to almost all the factual statements in Fox’s declaration and supplemental declaration, primarily on grounds of lack of foundation, opinion, speculation, hearsay, and the best evidence rule. At the hearing on the motions to quash brought by Patrick/Remax and Spigle/Summers, the court stated it had considered the information in the declarations, although “many of [the] objections were well taken.” Thereafter, the court expressly offered to rule on the objections. Counsel for Patrick/Remax responded “if the court is inclined to do that, that’s fine. If not, then that’s fine as well.” We view this as a waiver of the objections. (See Sharon P. v. Arman, Ltd. (1999) 21 Cal.4th 1181, 1186, fn. 1, disapproved on another ground in Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, [where party moving for summary judgment filed objections to the declarations of the plaintiff and her counsel, but the record contained no rulings on those objections, the court “deem[ed] the objections waived and view[ed] plaintiff’s evidence as having been admitted in evidence as part of the record for purposes of the appeal”].) In any event, for purposes of resolving whether respondents had minimum contacts with California, we rely on undisputed facts.
“Once facts showing minimum contacts with the forum state are established, . . . it becomes the defendant’s burden to demonstrate that the exercise of jurisdiction would be unreasonable. [Citation.] When there is conflicting evidence, the trial court’s factual determinations are not disturbed on appeal if supported by substantial evidence. [Citation.] When no conflict in the evidence exists, however, the question of jurisdiction is purely one of law and the reviewing court engages in an independent review of the record. [Citation.]” (Vons Companies, Inc. v. Seabest Foods, Inc., supra, 14 Cal.4th at p. 449.)
III
Respondents’ Minimum Contacts
A
Patrick/Remax
With these principles in mind, we look to the specific facts on which Fox seeks to base a finding of personal jurisdiction, beginning with those pertaining to Patrick/Remax. Patrick, on behalf of Remax, represented Fox in the purchase of the Virginia property. She had no formal role in the sale of the California property. She did, however, facilitate the transaction by acting as the local contact through which important communications were transmitted between Fox and her California broker. In addition, Fox contended that Patrick gave advice at critical junctures, referring Fox to Prine and encouraging her to sign both the listing agreement and the proposed counteroffer prepared by the California broker.
Where a nonresident defendant participates in interstate communications pertaining to a single transaction by phone, fax, and mail, the communications themselves are generally deemed insufficient evidence of minimum contacts to justify exercise of jurisdiction. (Vetrotex Certainteed v. Consolidated Fiber Glass Products Co. (3d Cir. 1996) 75 F.3d 147, 152; Soma Medical Intern. v. Standard Chartered Bank (10th Cir. 1999) 196 F.3d 1292, 1299; Stuart v. Spademan (5th Cir. 1985) 772 F.2d 1185, 1193; Peterson v. Kennedy (9th Cir. 1985) 771 F.2d 1244, 1262; see Floyd J. Harkness Co. v. Amezcua (1976) 60 Cal.App.3d 687, 691; Interdyne Co. v. SYS Computer Corp. (1973) 31 Cal.App.3d 508, 511-512.) At least one court has held that the fact a nonresident defendant referred the plaintiff to a professional in California who caused injury in California is not a basis for asserting jurisdiction over the nonresident where the nonresident “was to receive no economic benefit from the referral.” (Spokane Eye Clinic, Inc. v. Superior Court (1976) 63 Cal.App.3d 548, 553.)
Cinalli v. Kane (E.D. Pa. 2002) 191 F.Supp.2d 601 illustrates this point in the context of a realtor giving advice about a real estate transaction through use of interstate communications. There, buyers of property located in New Jersey sought to bring suit in their home state -- Pennsylvania -- against their realtor and others, all residents of New Jersey, alleging that the defendants “contacted them by phone, fax and mail in furtherance of the contract for the sale of property at issue.” (Id. at p. 611.) The Pennsylvania District Court found these facts insufficient to establish specific jurisdiction over the defendants where the property and all defendants were in New Jersey; “[a]ll of the material actions in [the] case including the inspection of the property, signing of the contract, and communication between the parties either occurred in or emanated from New Jersey”; and “[t]he follow-up contacts the [d]efendants had with [p]laintiffs in Pennsylvania were only necessary to complete the contract. [Citation.]” (Id. at p. 611-612.) Although the present situation differs from Cinalli in that here, the subject property is located in the forum state, the holding supports the proposition that a realtor giving advice to a client located outside the realtor’s state of residence cannot be drawn into litigation in the client’s preferred forum merely by directing communications to the forum state. (See also Peterson v. Kennedy, supra, 771 F.2d at p. 1261-1262 [where lawyer working out of union’s Washington D.C. office gave advice over the telephone to member working in California and wrote to California physician on member’s behalf, contacts were legally insufficient to permit suit against lawyer in a California court]; Edmunds v. Superior Court, supra, 24 Cal.App.4th 221, pp. 232-236 [same result where Hawaiian lawyer represented California client in Hawaiian litigation, traveled to California to represent client at a deposition, and offered advice via telephone about disclosures to California partners].)
The parties dispute whether Patrick was to receive any commission from the sale of the California property. It is undisputed that she had an economic interest in seeing the three-way exchange completed.
The result is different where the defendant engages in interstate communications and the court determines that “[the communications] represent an effort by the defendant to ‘purposefully avail[] itself of the privilege of conducting activities within the forum state.’” (Rambo v. American Southern Ins. Co. (10th Cir. 1988) 839 F.2d 1415, 1418-1419.) In that situation, “even a single letter or telephone call to the forum state may meet due process standards.” (Id. at p. 1418.) When a communication itself represents tortious conduct aimed at the state, the party who authored the communication should not be surprised to be haled into court there.
This is illustrated by LeDuc v. Kentucky Cent. Life Ins. Co. (N.D. Cal. 1992) 814 F.Supp. 820. There, the plaintiffs claimed an insurance company had actively concealed its financial instability from the plaintiffs and others. An out-of-state employee of the company was subjected to jurisdiction in California based on a letter to policyholders located in California, which “assured them that ‘there is absolutely no reason for you to be concerned about your policy’s safety or about [the company’s] stability.’” (Id. at p. 825.) Because the suit alleged “the fraudulent concealment of the financial downfall of [the company]” and the defendant’s actions allegedly “furthered the fraudulent scheme charged in the complaint,” the letter was “an act directed to the forum which [was] closely linked [to] the allegations of [the] litigation.” (Ibid.)
Patrick’s contacts with California were not limited to transmitting and accepting letters from the California realtor about the California transaction and giving advice to Fox. Patrick, acting for Remax, also sent the November 24, 2004 letter to Hacienda Escrow. This letter forms the crux of Fox’s claim for breach of fiduciary duty against Patrick/Remax. The complaint asserted that after Fox learned of Prine’s alleged fraud and instructed Hacienda Escrow not to close escrow, Patrick issued contrary instructions. In the letter, Patrick not only threatened to sue Hacienda Escrow if funds were not transferred to Virginia, but did so after identifying herself as agent for, inter alia, Fox. By threatening suit, Patrick invoked the benefits and protections of this state’s laws. By interceding in the California transaction in order to ensure that the Virginia transaction was funded, Patrick -- and through her, Remax -- purposefully directed activities at California in order to derive financial benefit. Because Patrick’s conduct in sending the letter constitutes a critical part of the tortious conduct underlying Fox’s claims against Patrick/Remax and was an act expressly aimed at or directed toward California, Patrick/Remax is subject to jurisdiction here. (In re Automobile Antitrust Cases I & II, supra, 135 Cal.App.4th at p. 123.)
As set forth above, in late November Fox allegedly learned that the prospective purchaser of the California property was a company owned by her listing agent’s brother-in-law. A party acting as a seller’s agent for the sale of real property may not secretly buy the property or cause it to be conveyed to a relative. (Batson v. Strehlow (1968) 68 Cal.2d 662, 667; Loughlin v. Idora Realty Co. (1968) 259 Cal.App.2d 619, 630-631.) Under the appropriate circumstances, the seller may rescind a contract entered into in violation of this rule. (Slusher v. Buckley (1959) 174 Cal.App.2d 324, 331; see Huijers v. DeMarrais (1992) 11 Cal.App.4th 676, 685-686.)
Patrick/Remax’s brief suggests that because the November 24 letter “makes no mention as against whom any such legal action would be directed [or] where any such legal action might be brought,” the letter might have referred to a potential action by the Virginia seller (Spigle/Summers) against Fox in Virginia. Examination of the letter permits no such inference. The letter was addressed to Hacienda Escrow and was entitled “RE Nancy Lee Fox Whispering Sands Mobile Home Part [sic].” It thus was directed to the California escrow company holding the proceeds of the California property sale. It demanded that Hacienda Escrow release the funds from the California transaction (“[w]e expect the funds to be sent today”), and specified that “[a]ny further delay will result in legal action.” The letter left no doubt that Patrick was threatening legal action against a California-based escrow company over its handling of a sale of California property. Patrick/Remax advances no basis on which suit might have been brought anywhere but California. Moreover, Patrick identified herself as a dual agent for a transaction involving Fox, whose name she repeatedly invoked. Nowhere did she suggest that she -- or anyone else -- intended to take legal action against her own client. Clearly, Hacienda Escrow was the express target of Patrick’s letter, and her insistence that Hacienda Escrow release the funds or face legal action had its intended effect of inducing Hacienda Escrow to forward the sale proceeds to Virginia.
This is true regardless of whether Patrick was to receive a percentage of the commission on the sale of the California property, as she was to receive the entire commission on completion of the sale of the Virginia property.
Patrick/Remax contends it would be unreasonable to force it to litigate in California. Although it will be burdensome for Patrick/Remax to defend a lawsuit here, this state’s interest in protecting property owners and the judicial economy involved in permitting Fox to pursue her claims related to the California property in one action outweigh that burden. In contrast to Patrick/Remax, none of the numerous California defendants is alleged to have contacts with Virginia or to be subject to suit there. (See Rice Growers Assn. v. First National Bank (1985) 167 Cal.App.3d 559, 576 [in litigation involving defective vessel primarily used in California but built elsewhere, court found “exercise of jurisdiction over [nonresident ship builder] in this state” to be “both reasonable and desirable” due to “the integrated nature of the transaction involving numerous other defendants . . . all subject to the authority of the California court”].) In short, assertion of personal jurisdiction against Patrick/Remax would “‘comport with “fair play and substantial justice.”’” (Vons Companies, Inc. v. Seabest Foods, Inc., supra, 14 Cal.4th at p. 447, quoting Burger King, supra, 471 U.S. at p. 476.)
In her declaration in support of the motion to quash, Patrick contended the complaint had not been properly served. The trial court’s ruling did not address the issue. On remand, Patrick may pursue it.
B
Watts/Abacus
Watts had more physical contacts with California than Patrick. He traveled to California with Fox and was present when she first discussed with Prine selling the property. According to Fox, he encouraged her to sell before they returned to Virginia. However, unlike Patrick, his contacts with the state -- traveling to California with a romantic partner, offering her advice about the real estate market and interest rates -- were not indicative of an intent to conduct business here or to invoke the benefits and protections of this state’s laws.
The complaint contained two specific allegations pertaining to Watts: that he misrepresented the value of the California property, and that he breached his fiduciary duty to Fox by failing to halt the transmission of funds to Spigle/Summers after Hacienda Escrow sent the funds to the Virginia bank. With respect to the first allegation, the declarations make clear that Watts performed the calculations and made the representations that allegedly led to Fox’s decision to list the property at $950,000 while the couple was in Virginia, not California.
With respect to Fox’s attempt to rely on Watts’s agreement to assume the role of exchange intermediary to support jurisdiction, his status as exchange intermediary required no significant contacts with California. (See Sibley v. Superior Court (1976) 16 Cal.3d 442, 447 [nonresident who agreed to be a guarantor for a debt owed to a California company did not have sufficient minimum contacts with California to support jurisdiction].) Although the funds for which he was to be the temporary trustee came from the sale of property in California, his part in the transaction involved purely out-of-state activities: opening a bank account in Virginia and ensuring transfer of funds from that account to a seller in Virginia. When Hacienda Escrow transferred the funds to the Virginia bank after Patrick’s intercession, Watts failed to take action to stop the bank from turning the funds over to Spigle/Summers. According to Watts, he was helpless at that point, because the bank had been given binding instructions on what to do after the funds were transferred to Virginia. Whether we give credence to Watts’s claim that he had no power to stop the transfer after Hacienda Escrow set it in motion, any act -- or omission to act -- on his part occurred in Virginia, not California. Unlike Patrick/Remax, he played no part in the initial transfer of funds from California. He performed no allegedly tortious act in, or directed at, California. Fox established no basis on which a California court could validly assert jurisdiction over Watts.
Fox asserted no independent ground to support a finding of jurisdiction with respect to Abacus. Therefore, our conclusions concerning Watts apply equally to Abacus. In addition, Abacus is a Virginia corporation in the business of providing or procuring mortgages. Fox had no need to obtain a mortgage because the funds to purchase the Virginia property came from Whispering Sands. There is no evidence to suggest that Watts performed any of the actions attributed to him in his capacity as president and owner of that corporation. Fox nowhere asserts that the advice offered to her by Watts was given in the name of his corporation, and Watts entered into the agreement which made him the exchange intermediary in his own name. The evidence thus indicates that Abacus’s potential connection to California is even more tenuous than Watts’s.
C
Spigle/Summers
Spigle/Summers owned the Virginia property and sought to sell it through a Virginia broker. The prospective purchaser -- Fox – maintained a residence in Virginia. The fact that the sale of the Virginia property was contingent on the sale of Fox’s property in California does not create significant contacts between Spigle/Summers and California. Notwithstanding the provisions of the tax code permitting Fox to treat the separate sales as a simultaneous, like-kind exchange, the two transactions were entirely separate.
Fox attempts to subject Spigle/Summers to California jurisdiction based on the fact that Patrick/Remax was Spigle/Summers’s agent as well as Fox’s. According to Fox, “the demand by . . . Patrick[] that the California escrow agent wire transfer [Fox’s] funds to Virginia was clearly for the benefit of Patrick’s principle [sic] . . . .” (Emphasis omitted.) A principal may be subjected to jurisdiction based on the tortious actions of his or her agent in the forum state where the agent is acting within the scope of his or her authority. (Magnecomp Corp. v. Athene Co. (1989) 209 Cal.App.3d 526, 538.)
By Patrick’s own admission, she was acting as dual agent for both Fox and Spigle/Summers in connection with the sale of the Virginia property. Doubtless the transfer of funds from California to Virginia ultimately benefited Spigle/Summers. However, Fox’s complaint specifically alleged that Patrick “was representing [Fox] as a professional real estate broker”; it did not allege that Patrick was acting as the agent of Spigle/Summers when she engaged in tortious conduct. Moreover, nothing in the record supports an inference that Patrick was acting in the course and scope of her duties as agent for Spigle/Summers when she sent the November 24 letter to Hacienda Escrow. The letter itself makes no mention of Spigle/Summers, but refers repeatedly to Fox. Indeed, the crux of Fox’s claim against Patrick/Remax is that in sending the letter, Patrick breached her fiduciary duty to Fox -- a duty arising solely from her capacity as Fox’s agent. As a result, the act did not implicate Spigle/Summers in the way that the actions of the agent implicated the nonresident in Magnecomp Corp. v. Athene Co., supra, 209 Cal.App.3d 526. There, the agent’s misappropriation of the plaintiff’s trade secrets was both the support for jurisdiction and the basis of the claim against the principal. Here, Spigle/Summers cannot be liable for breach of any fiduciary duty Patrick/Remax, as Fox’s agent, owed her. The gravamen of Fox’s claim against Spigle/Summers is that the Virginia seller allegedly misrepresented the value of the Virginia property. In short, Patrick’s action in sending the letter cannot justify assertion of jurisdiction by a California court over Spigle/Summers.
DISPOSITION
The orders quashing service of process are reversed with respect to respondents Patrick and Remax. In all other respects the orders are affirmed. Watts, Abacus, and Spigle/Summers are awarded their costs on appeal from Fox. Fox is awarded her costs on appeal from Patrick/Remax.
We concur: EPSTEIN, P. J.WILLHITE, J.