A. R. Industries, Inc. v. Superior Court

268 Cal. App. 2d 328, 73 Cal. Rptr. 920, 1968 Cal. App. LEXIS 1312
CourtCalifornia Court of Appeal
DecidedDecember 19, 1968
DocketCiv. 12033
StatusPublished

This text of 268 Cal. App. 2d 328 (A. R. Industries, Inc. v. Superior Court) is published on Counsel Stack Legal Research, covering California 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. R. Industries, Inc. v. Superior Court, 268 Cal. App. 2d 328, 73 Cal. Rptr. 920, 1968 Cal. App. LEXIS 1312 (Cal. Ct. App. 1968).

Opinion

PIERCE, P. J.

Petitioner, A. R. Industries, Inc., an Ohio corporation, seeks a writ of mandate to require the Sacramento County Superior Court to quash service of summons. Service was pursuant to Code of Civil Procedure section 411, subdivision 2, upon the theory that defendant was “doing business’’ in this state. After reviewing the evidence, we have concluded that Industries’ contention that service offended the due process clause of the Fourteenth Amendment cannot be sustained.

The pending action was brought by Cervantes, the real part in interest. The action was based upon bodily injuries allegedly caused to him by a defective buffing machine. That machine was one of three 3.8-ton buffing machines manufactured in 1965 by Industries in its home state, Ohio, and pur *330 chased by Formica, a subsidiary of American Cyanamid, a New Jersey corporation. All transactions regarding the purchase and sale were handled between the seller and the buyer in either New Jersey or Ohio. The sale was the result of a call for bids by Formica. After manufacture the three machines had been shipped by Industries direct to Formica’s plant in California by common carrier f.o.b. such plant. The contract was not completed until delivery of the machines. They were not sent on consignment. Industries retained no title. They were sold for use and not for resale. Installation was by Formica. Industries was not qualified to transact business in California; Industries owned no property here. It had no California offices or representatives. It advertised, however, in national advertising media. It had previously delivered at least one of its products, a cement lintel machine, in California. No contention is made in the main action that Industries did not receive substituted service seasonably.

Historically the jurisdiction of courts to render in personam judgments “is grounded on their de facto power over the defendant’s person. Hence his presence within the territorial jurisdiction of a court was prerequisite to its rendition of a judgment personally binding him. Pennoyer v. Neff, 95 U.S. 714, 733 [24 L.Ed. 565, 572], But now ... due process requires only 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. ’ [Citations.]” (Italics ours.) (International Shoe Co. v. Washington, 326 U.S. 310, 316 [90 L.Ed. 95, 102, 66 S.Ct. 154, 161 A.L.R. 1057].)

International Shoe was cited and its concept was repeated thusly-by our Supreme Court in Fisher Governor Co. v. Superior Court (1959) 53 Cal.2d 222, at page 224 [1 Cal.Rptr. 1. 347 P.2d 1] ; “Code of Civil Procedure, section 411, subdivision 2. authorizes service of process on foreign corporations that are ‘doing business in this State.’ That term is a descriptive one that the courts have equated with such minimum contacts with the state “that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ”... Whatever limitation it imposes is equivalent to that of the due process clause. “ ‘ [D]oing business’ within the meaning of section 411 of the Code of Civil Procedure is synonymous with the power of the state to subject *331 foreign corporations to local process.”’ [Citations.]” (Italics ours.)

A balancing process takes place when, after establishing the fact that minimum contacts” have occurred within the forum state, the courts try to determine whether such contacts reach a status adequate to satisfy ‘ traditional notions of fair play and substantial justice,” or as it has been otherwise expressed, “the fair and orderly administration of the laws which it was the purpose of the due process clause to insure.” (International Shoe Co. v. Washington, supra, at p. 104 of 90 L.Ed.) Due process is not met, of course, when a court of the forum attempts to make a binding “in personam” judgment against an individual or corporate defendant with which the state has no contacts, ties, or relations. ’ ’ On the other hand, to the extent that a foreign corporation exercises the privilege of conducting activities within a state it derives benefits and protection of the laws of the state which may justly give rise to corresponding obligations connected with those activities. A suit brought to enforce such obligations “can, in most instances, hardly be said to be undue.” (International Shoe Co. v. Washington, supra, at p. 104.)

Fisher Governor Co. v. Superior Court, supra, 53 Cal. 2d 222, reviews many factors which courts have considered relevant in the balancing process suggested above. These are, as stated on pages 225-226: the interest of the state in providing a forum for its residents; the relative availability of evidence and the burden of defense and prosecution in one place rather than another; the ease of access to an alternative forum; the avoidance of multiplicity of suits and conflicting adjudications; and the extent to which the cause of action arose out of defendant’s local activities. In Fisher the action, similar to the action with which we are concerned, arose from injuries sustained from allegedly defective equipment manufactured by the defendant. Unlike the instant case, however, the cause of action did not arise in California; it arose in Idaho. Our Supreme Court there deemed defendant’s “minimum activities” (sales of its products through manufacturers’ agents) sufficient to have satisfied due process had the cause of action related to the defendant corporation’s activities within this state. It cited Cosper v. Smith & Wesson Arms Co. (1959) 53 Cal.2d 77 [346 P.2d 409], where the cause of action had arisen in California (injuries from a defective *332 gun), and where, under ‘‘essentially similar sales activities” jurisdiction in California was sustained. In Fisher, however, for the reason stated, California jurisdiction was denied. The court states on page 226: “. . . Evidence can be produced as easily or more easily elsewhere, and even if plaintiffs cannot secure jurisdiction "Over Fisher in Idaho, they can prosecute their actions against Fisher as conveniently in Iowa as here.” The opinion also points "Out that there was no evidence in the record to support" the contention' “that jurisdiction over Fisher’s eodefendant's can only be secured in California.” Thus, ‘ duplicity of litigation ’ ’ did not appear.

In McGee v. International Life Ins. Co. (1957) 355 U.S. 220 222-223 [2 L.Ed.2d 223. 226, 78 S.Ct.

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Bluebook (online)
268 Cal. App. 2d 328, 73 Cal. Rptr. 920, 1968 Cal. App. LEXIS 1312, Counsel Stack Legal Research, https://law.counselstack.com/opinion/a-r-industries-inc-v-superior-court-calctapp-1968.