Opinion
No. 05-04-00530-CV
Opinion Filed October 21, 2004.
On Appeal from the 193rd Judicial District Court, Dallas County, Texas, Trial Court Cause No. 03-07799-L.
Affirm.
Before Justices WRIGHT, RICHTER, and MAZZANT.
MEMORANDUM OPINION
In this interlocutory appeal, Margaret Ann Long appeals an order denying her special appearance in a declaratory judgment action involving the proceeds from the production from a certain oil well. In three issues, Long contends the trial court erred by denying her special appearance because she does not have sufficient contacts with Texas and litigating this suit in Texas would violate due process. For the reasons that follow, we affirm the trial court's order denying Long's special appearance.
Corman, an oil and gas operator, is the president of Dallas L.M.C. Co., a Texas corporation located in Dallas, Texas. Appellant, an Oklahoma resident, purchased certain oil and gas interests, located in Oklahoma, for which Corman serves as the operator. For the past several years, Corman collected expenses from appellant and paid to appellant her part of the proceeds from these wells. All of the accounting, preparation of joint monthly joint interest billings, collections, and other correspondence in regards to the operation of the wells occurs at appellees' Dallas office. Any checks issued to appellant subject to the operating agreement on those wells are drawn on appellees' bank account at Bank of America in Dallas.
Several years after first conducting business with Corman, appellant sent a demand letter to Corman, claiming she was entitled to proceeds from additional wells located in the same section and also operated by Corman. After a series of correspondence, in which Corman declined to pay appellant because he had no record of an operating agreement for the additional wells and in which appellant mentioned litigation, appellees filed a declaratory judgment action, seeking a declaration as to whether appellees are indebted to appellant pursuant to an operating agreement between appellant and appellees. Appellant filed a special appearance. After considering the evidence, the trial court denied appellant's special appearance. This appeal followed.
The standard of review in special appearance cases and the law regarding in personam jurisdiction is well established. See BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 793-96 (Tex. 2002); N. Coast Commercial Roofing Sys., Inc. v. RMAX, Inc., 130 S.W.3d 491, 494-95 (Tex.App.-Dallas 2002, no pet.). In this case, the trial court made certain findings of facts and concluded that Texas has jurisdiction over appellant under principles of both general and specific jurisdiction and that the court's assumption of jurisdiction did not offend traditional notions of fair play and substantial justice. Appellant does not challenge the trial court's fact findings, but rather contends the trial court's conclusions of law were erroneous. Analyzing the facts of this case under the law, we, like the trial court, conclude there is general jurisdiction in this case.
In addition to the facts outlined above, the record shows appellant owns an interest in a well located in Texas from which she receives monthly checks and for which she pays production tax in Texas. Not only does she conduct business with appellees, but also with several oil and gas operators who are located in Texas, including Merit Energy Company in Dallas, Texas, Apache Corporation in Houston, Texas, and El Paso Production in El Paso, Texas. Pursuant to contractual agreements with these operators, appellant routinely receives joint interest billings or statements of accounts from these Texas oil and gas operators, has paid bills to these Texas operators for operating expenses, and has received payments from these Texas operators. Thus, as appellant stated, for the past several years and currently, appellant "does business" with Texas oil and gas operators, including Corman.
We agree with the trial court that these facts are sufficient to show that appellant has substantial contacts with Texas and that the contacts are continuous and systematic. Under these circumstances, we cannot conclude the trial court erred by determining appellant's contacts with Texas are sufficient to support a finding of general jurisdiction. See Beechem v. Pippin, 686 S.W.2d 356, 361-63 (Tex.App.-Austin 1985, no writ) (jurisdiction in Texas where defendant contracted with Texas company, corresponded with Texas business, and possessed property in Texas-an "important" factor in determining whether defendant enjoyed the benefits, protections, and privileges of the forum state); Gurley v. Lindsley, 459 F.2d 268, 278 (5th Cir. 1972) (jurisdiction in Texas under the long-arm statute where defendant enjoyed benefits of Texas land ownership, received royalties from land, managed it, paid taxes, demanded accounting, and joined in sale of mineral interest); cf. CSR Ltd v. Link, 925 S.W.2d 591, 595 (Tex. 1996) (general jurisdiction not established where Australian company did not have offices in Texas, had not solicited business in Texas, had not sent any correspondence to Texas, had not entered into a contract in Texas, and did not own property or pay taxes in Texas). We overrule appellant's first issue. Having done so, we need not consider appellant's second issue regarding specific jurisdiction. See Marchand, 83 S.W.3d at 796 (personal jurisdiction exists if contacts give rise to either specific jurisdiction or general jurisdiction).
Having concluded the trial court properly determined the facts in this case support a finding of general jurisdiction, we must next consider whether the assertion of jurisdiction comports with fair play and substantial justice. Only in rare cases will the exercise of jurisdiction not comport with fair play and substantial justice when the defendant has purposefully established minimum contacts with the forum state. Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223, 231 (Tex. 1990). Thus, when such contacts exist, a defendant must present a compelling case that the existence of other factors would render jurisdiction unreasonable. Id. at 230.
After reviewing the record in this case, we cannot conclude appellant has made such a showing. Although it may be inconvenient for appellant to litigate this matter in Texas, all other factors weigh in favor of a Texas court's exercise of jurisdiction. Appellees and Texas have a strong interest in having the case heard in this State. The lawsuit involves the alleged indebtedness of Texas residents pursuant to a contract partially performed in Texas. Dallas L.M.C. Company is not only organized under Texas laws, but has a Texas headquarters. Contrary to appellant's suggestion that the case may involve "a determination of Oklahoma law" and require Oklahoma title companies to conduct nationwide searches, the case does not involve a property interest that would require title searches. The record shows that unlike property interests (which are not in dispute in this case), owner-operator agreements (such as the one in dispute) are not "normally recorded." Any applicable social policies concerning the contract between Texas and Oklahoma residents, performed in both states, may be implemented by a Texas court. All things considered, we conclude it does not offend traditional notions of fair play and substantial justice to subject appellant to jurisdiction in Texas. We overrule appellant's third issue.
Accordingly, we affirm the trial court's order denying appellant's special appearance.