Bauer v. Douglas Aquatics, Inc.

698 S.E.2d 757, 207 N.C. App. 65, 2010 N.C. App. LEXIS 1631
CourtCourt of Appeals of North Carolina
DecidedSeptember 7, 2010
DocketCOA10-47
StatusPublished
Cited by39 cases

This text of 698 S.E.2d 757 (Bauer v. Douglas Aquatics, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bauer v. Douglas Aquatics, Inc., 698 S.E.2d 757, 207 N.C. App. 65, 2010 N.C. App. LEXIS 1631 (N.C. Ct. App. 2010).

Opinion

BEASLEY, Judge.

Defendant Douglas Aquatics, Inc. (Appellant) appeals the trial court’s order denying its motion to dismiss for lack of personal jurisdiction under Rule 12(b)(2) of the North Carolina Rules of Civil Procedure. Because Appellant raises the sole question of whether the exercise of personal jurisdiction over it by the North Carolina courts comports with due process and we conclude that it does, we affirm.

Appellant, a Virginia corporation performing pool construction services, also franchises several pool management and construction companies located in Virginia and North Carolina. John Bauer (Plaintiff) is a North Carolina resident. This action arises out of a swimming pool construction agreement entered into by Plaintiff and Defendant Douglas Aquatics Charlotte, LLC (DA Charlotte), a franchisee of Appellant residing in North Carolina. Alleging faulty'construction, Plaintiff filed a verified complaint on 18 March 2009 against Appellant and DA Charlotte 1 for breach of warranties, breach of contract, negligence, fraud, unfair and deceptive trade practice, and agency. In its answer filed 21 May 2009, Appellant included motions to dismiss for lack of personal jurisdiction and failure to state a claim.

A hearing was held on Appellant’s motion to dismiss, during which the trial court considered Plaintiff’s verified complaint, Appellant’s answer, an affidavit from Appellant’s president Thomas G. Crouch, documentary evidence, and arguments of counsel. The trial court denied Appellant’s motions to dismiss for lack of personal jurisdiction and for failure to state a claim, concluding: (1) Appellant is subject to jurisdiction in North Carolina under N.C. Gen. Stat. § 1-75.4 (North Carolina’s “long-arm” statute); (2) “[Appellant] has sufficient minimum contacts with North Carolina to justify personal jurisdiction”; and (3) “Plaintiff’s claims sufficiently state the essential allegations necessary to support the claims asserted.” The sole basis for this appeal is the trial court’s ruling on the personal jurisdiction issue.

*67 Initially, we note that notwithstanding the interlocutory nature of the trial court’s order, the denial of Appellant’s motion to dismiss on personal jurisdiction grounds is immediately appealable. Bruggeman v. Meditrust Acquisition Co., 138 N.C. App. 612, 614, 532 S.E.2d 215, 217 (2000); see also N.C. Gen. Stat. § 1- 277(b) (2009) (“Any interested party shall have the right of immediate appeal from an adverse ruling as to the jurisdiction of the court over the person or property of the defendant].] . . .”).

Standard of Review

Our courts engage in a two-step inquiry to resolve whether personal jurisdiction over a non-resident defendant is properly asserted: first, North Carolina’s long-arm statute must authorize jurisdiction over the defendant. If so, the court must then determine whether the exercise of jurisdiction is consistent with due process. Skinner v. Preferred Credit, 361 N.C. 114, 119, 638 S.E.2d 203, 208 (2006); see also Brown v. Meter, — N.C. App. — , —, 681 S.E.2d 382, 387 (2009) (noting that “ ‘[w]hen personal jurisdiction is alleged to exist pursuant to the long-arm statute, the [issue] collapses into one inquiry,’ ” which is the question of minimum contacts).

The determination of whether jurisdiction is statutorily and constitutionally permissible due to contact with the forum is a question of fact. The standard of review of an order determining personal jurisdiction is whether the findings of fact by the trial court are supported by competent evidence in the record; if so, this Court must affirm the order of the trial court.

Replacements, Ltd. v. Midwesterling, 133 N.C. App. 139, 140-41, 515 S.E.2d 46, 48 (1999) (internal citations omitted). “Where no exception is taken to a finding of fact by the trial court, the finding is presumed to be supported by competent evidence and is binding on appeal.” Nat’l Util. Review, LLC v. Care Ctrs., Inc., — N.C. App. — , —, 683 S.E.2d 460, 463 (2009) (internal quotation marks and citation omitted).

Appellant disputes only the presence of federal due process requirements in challenging the court’s exercise of personal jurisdiction and does not address the applicability of North Carolina’s long-arm statutory authority. Therefore, we likewise confine our discussion to this issue, and our sole inquiry is whether Plaintiff’s assertion of jurisdiction over Appellant comports with due process of law. Accordingly, we must determine whether the trial court’s findings of fact are supported by competent evidence, which in turn support its *68 conclusion of law that our courts’ entertainment of this action over Appellant does not violate due process.

Appellant assigns error to several of the trial court’s findings of fact in that they are unsupported by competent record evidence. Specifically, Appellant contends that any of the findings based on Plaintiff’s verified complaint were erroneous because the complaint was not competent evidence and, thus, the allegations therein were insufficient to support those findings. Appellant argues that the verified complaint was not based on Plaintiff’s personal knowledge, such that the facts found by the trial court in reliance thereon consisted of inadmissible hearsay.

The procedural context of the personal jurisdiction challenge in the trial court guides our review of this issue:

Typically, the parties will present personal jurisdiction issues in one of. three procedural postures: (1) the defendant makes a motion to dismiss without submitting any opposing evidence; (2) the defendant supports its motion to dismiss with affidavits, but the plaintiff does not file any opposing evidence; or (3) both the defendant and the plaintiff submit affidavits addressing the personal jurisdiction issues.

Banc of Am. Secs. LLC v. Evergreen Int’l Aviation, Inc., 169 N.C. App. 690, 693, 611 S.E.2d 179, 182 (2005). When the parties submit “dueling affidavits” under the third category, the trial court may decide the matter from review of the affidavits, or “the court may direct that the matter be heard wholly or partly on oral testimony or depositions.” Id. at 694, 611 S.E.2d at 183 (internal quotation marks and citations omitted). In either case, the plaintiff bears the burden of proving, by a preponderance of the evidence, grounds for exercising personal jurisdiction over a defendant. Adams, Kleemeier, Hagan, Hannah & Fouts, PLLC v. Jacobs, 158 N.C. App. 376, 378, 581 S.E.2d 798, 801, rev’d on other grounds, 357 N.C. 651, 588 S.E.2d 465 (2003).

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Cite This Page — Counsel Stack

Bluebook (online)
698 S.E.2d 757, 207 N.C. App. 65, 2010 N.C. App. LEXIS 1631, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bauer-v-douglas-aquatics-inc-ncctapp-2010.