A & L ENERGY, INC. v. Pegasus Group

771 So. 2d 248, 2000 WL 1643976
CourtLouisiana Court of Appeal
DecidedNovember 3, 2000
Docket34,222-CA
StatusPublished
Cited by2 cases

This text of 771 So. 2d 248 (A & L ENERGY, INC. v. Pegasus Group) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
A & L ENERGY, INC. v. Pegasus Group, 771 So. 2d 248, 2000 WL 1643976 (La. Ct. App. 2000).

Opinion

771 So.2d 248 (2000)

A & L ENERGY, INC., Plaintiff-Appellant,
v.
PEGASUS GROUP, Central Self Storage Investor, III, CSS-Hempstead and First American Title Insurance Company, Defendants-Appellees.

No. 34,222-CA.

Court of Appeal of Louisiana, Second Circuit.

November 3, 2000.

*249 McCoy, Roberts & Begnaud, Ltd by Mark A. Begnaud, Kenneth D. McCoy, Jr., Natchitoches, Counsel for Appellant.

Mayer, Smith & Roberts, L.L.P. by Deborah Shea Baukman, Shreveport, Steven C. Polgar, Counsel for Appellees Pegasus Group, Central Self Storage Investors, III, and CSS-Hempstead.

Blanchard, Walker, O'Quin & Roberts by J. David Garrett, Shreveport, Counsel for Appellee First American Title Insurance Company.

Before NORRIS, C.J., GASKINS and DREW, JJ.

GASKINS, J.

In this breach of contract suit involving the sale of Texas real estate, the plaintiff appeals an adverse judgment which sustained the exceptions to subject matter jurisdiction and personal jurisdiction filed by three out-of-state defendants. For the reasons set forth below, we affirm the trial court judgment.

FACTS

In the spring of 1999, the president of A & L Energy, Inc. ("A & L"), responded to an advertisement in the Central Edition of the Wall Street Journal by calling the telephone number listed therein. In the advertisement, the defendants offered for sale certain real estate in Houston, Texas. The parties communicated by telephone, and the defendants sent A & L written materials pertaining to the property.

Thereafter, on June 14, 1999, A & L entered into an agreement of purchase and sale of that real estate with Pegasus Group ("Pegasus"), a California company. Among other things, the agreement provided that it would be governed by Louisiana law. Pursuant to the agreement, A & L paid deposits—or earnest money—of $30,000 to First American Title Insurance Company ("First American") and $10,000 to Pegasus. An inspection period of 45 days was set; during this period, A & L could terminate the agreement for any reason and its earnest money would be returned.

During the inspection period, A & L notified Pegasus of its decision to terminate the agreement. However, Pegasus refused A & L's request to return the earnest money held by it or First American. Apparently these funds are on deposit in banks in Texas and California.

On September 24, 1999, A & L filed suit in Caddo Parish, Louisiana, against four out-of-state parties—Pegasus, a California *250 legal entity; Central Self Storage Investors, III, a California limited partnership; CSS-Hempstead, also a California limited partnership; and First American, a California title insurer authorized to do business in Louisiana and Texas.[1] According to the allegations of A & L's petition, Pegasus was initially an undisclosed agent for Central Self Storage Investors, III, and CSS-Hempstead. In the suit, A & L sought the return of its earnest money, plus interest, as well as attorney fees allowed under the terms of the contract.

On November 3, 1999, Pegasus, Central Self Storage Investors, III, and CSS-Hempstead jointly filed exceptions to personal and subject matter jurisdiction. They contended that the proper subject matter jurisdiction is in Harris County, Texas, the location of both the immovable property involved in the sale and the bank where some of the funds in dispute are on deposit. As to personal jurisdiction, they asserted that all exceptors are California legal entities which have never been licensed to do business in Louisiana and which have never done business or engaged in any business activity in Louisiana which would satisfy the minimum contact requirements. They argued that while they agreed in the contract that it would be construed according to Louisiana law, they did not agree that venue or jurisdiction in Louisiana was proper.

In opposition to the exceptions, A & L filed an affidavit by Rex Bryan, a principal in Lea Hall Properties, the agent for A & L, setting forth the actions in Louisiana pertaining to the agreement.

In May 2000, the trial court sustained the exceptions. The court found that even though the parties to the contract agreed that Louisiana law would be applied to resolve disputes between the parties, such an agreement did not provide the court with subject matter or personal jurisdiction under the facts presented in the instant case. The judgment also provided that the parties could agree to transfer the action to a court of appropriate jurisdiction within 15 days of the judgment becoming final. Otherwise, the case would be dismissed without prejudice at the plaintiffs cost.

A & L appealed.

PERSONAL JURISDICTION

Law

The appellate court conducts a de novo review of the legal issue of personal jurisdiction over a nonresident by a Louisiana court. Hunter v. Meyers, 96-1075 (La.App. 1st Cir. 3/27/97), 691 So.2d 318; Griffith v. French, 97-2635 (La.App. 1st Cir. 12/28/98), 723 So.2d 1140, writ denied, 99-0220 (La.3/19/99), 740 So.2d 116. However, the trial court's factual findings underlying the decision are reviewed under the manifest-error standard of review. Griffith, supra.

The Louisiana long-arm statute, La. R.S. 13:3201 provides, in relevant part:

A. A court may exercise personal jurisdiction over a nonresident, who acts directly or by an agent, as to a cause of action arising from any one of the following activities performed by the nonresident:
(1) Transacting any business in this state.
. . . .
B. In addition to the provisions of Subsection A, a court of this state may exercise personal jurisdiction over a nonresident on any basis consistent with the constitution of this state and of the Constitution of the United States.

Under the express terms of the long-arm statute, the sole inquiry into personal jurisdiction over a nonresident involves an analysis of the constitutional due process requirements. Griffith, supra; Superior Supply Company v. Associated *251 Pipe and Supply Company, 515 So.2d 790 (La.1987). Due process requires that in order to subject a nonresident defendant to a personal judgment, the defendant must have certain minimum contacts with the forum state such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice. de Reyes v. Marine Management and Consulting, Ltd., 586 So.2d 103 (La.1991).

In interpreting the due process clause, the United States Supreme Court has recognized a distinction between two types of personal jurisdiction—"general" and "specific" jurisdiction. de Reyes, supra; Burger King Corporation v. Rudzewicz, 471 U.S. 462, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). Specific jurisdiction over a nonresident defendant is appropriate when that defendant has purposefully directed its activities at residents of the forum state and the litigation results from alleged injuries that arise out of or relate to those activities. Burger King, supra; de Reyes, supra; Hollis v. Info Pro Technology, 33,606 (La. App.2d Cir.6/21/00), 764 So.2d 184. General jurisdiction, on the other hand, will attach where the nonresident defendant's contacts with the forum state, although not related to the plaintiff's cause of action, are continuous and systematic. Hollis, supra.

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Related

First Nat. Bank of Lewisville v. Jones
811 So. 2d 217 (Louisiana Court of Appeal, 2002)
A & L ENERGY, INC. v. Pegasus Group
791 So. 2d 1266 (Supreme Court of Louisiana, 2001)

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Bluebook (online)
771 So. 2d 248, 2000 WL 1643976, Counsel Stack Legal Research, https://law.counselstack.com/opinion/a-l-energy-inc-v-pegasus-group-lactapp-2000.