Creative Business v. Magnum

632 A.2d 298, 267 N.J. Super. 560
CourtNew Jersey Superior Court Appellate Division
DecidedOctober 26, 1993
StatusPublished
Cited by5 cases

This text of 632 A.2d 298 (Creative Business v. Magnum) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Creative Business v. Magnum, 632 A.2d 298, 267 N.J. Super. 560 (N.J. Ct. App. 1993).

Opinion

267 N.J. Super. 560 (1993)
632 A.2d 298

CREATIVE BUSINESS DECISIONS, INC., A NEW JERSEY CORPORATION, PLAINTIFF-APPELLANT,
v.
MAGNUM COMMUNICATIONS LIMITED, INC., A GEORGIA CORPORATION, DEFENDANT-RESPONDENT.

Superior Court of New Jersey, Appellate Division.

Argued October 4, 1993.
Decided October 26, 1993.

*563 Before Judges PETRELLA, BAIME and CONLEY.

Edward M. Bernstein argued the cause for appellant (Bernstein & Shafer, attorneys; Mr. Bernstein, of counsel and on the brief).

*564 William Fox argued the cause for respondent (Cullen and Dykman, attorneys; Peter G. Sheridan, of counsel and on the brief).

The opinion of the court was delivered by BAIME, J.A.D.

Plaintiff Creative Business Decisions, Inc. appeals from the Law Division's order, dismissing its complaint against defendant Magnum Communications, Ltd. The Law Division found that defendant's contacts with New Jersey were insufficient to confer jurisdiction. Alternatively, the court dismissed the suit on the basis of forum non conveniens. We reverse.

I.

At the outset, we note that the Law Division decided the jurisdictional issues presented on sketchy documentary submissions without the benefit of discovery or further development of the evidence. Our understanding of the facts is thus gleaned from the paltry and incomplete record submitted to us.

Plaintiff is a New Jersey corporation with its principal place of business in Princeton. It is in the business of developing and providing credit management decision and control systems for banks, retailers and other credit institutions. Defendant is a Georgia corporation and is engaged in the same type of business.

In its complaint, plaintiff sought damages from defendant for breach of contract and negligence. Two separate causes of action were alleged. The first pertained to commissions defendant allegedly owed plaintiff for customer referrals. Specifically, plaintiff contended that the parties had entered a joint venture in which the recipient company agreed to pay five percent of the total revenue generated as a result of customer referrals and that defendant had breached that agreement. Plaintiff asserted that defendant had failed to pay monies due on referral accounts including, but not limited to, Lomas Bank and Marshall Fields.

*565 The second cause of action related to a longstanding marketing venture between the parties. Plaintiff claimed that, as an outgrowth of this venture, defendant agreed to organize and conduct a conference in Lake Lanier, Georgia. Plaintiff charged that defendant failed to properly coordinate the conference, resulting in excessive costs and loss of business.

We digress to observe that the second cause of action was inartfully drafted in the complaint. Although plaintiff sought damages based upon defendant's "negligence," the gist of the claim pertained to an alleged breach of contract resulting in consequential damages. Defendant's counterclaim supports our interpretation of plaintiff's cause of action. Referring to the same transaction, defendant asserted that plaintiff breached its agreement by failing to share in the funding of the conference.

In its answer and subsequent motion to dismiss the complaint, defendant asserted that New Jersey lacked jurisdiction. Specifically, defendant argued that its business operations had no nexus to New Jersey and that maintenance of plaintiff's suit in this State offended traditional notions of fair play and substantial justice. Plaintiff's president, Pat Nanda, filed a certification in opposition to defendant's motion. According to Nanda, beginning in 1986, the parties entered into a series of overlapping joint ventures respecting customer referrals and marketing. The customer referral agreement was memorialized in a written contract signed by the presidents of both companies on June 6, 1986. The contract, entitled "FINDER'S FEE AND REVENUE SHARING AGREEMENT," provided commissions for customer referrals and stated that the companies would "equally share all future revenues generated by the development" of specified computer software.

In addition, the parties entered into an extensive marketing agreement commencing in April 1987 and continuing through September 1990. In furtherance of this agreement, the parties jointly hired Michael Lambert and Gregory Keyes to market and sell their products. Lambert was based in Georgia and was responsible for staffing and administration. Keyes operated as an *566 account executive from his base in plaintiff's Princeton office. Although a confirmation letter from defendant provided that the salaries of all personnel were to be jointly funded, plaintiff claimed that defendant paid the entire amount of Keyes' salary. Nanda further alleged that, as part of their joint marketing arrangement, the parties prepared a referral list, dividing responsibilities for customer solicitation. So too, sales territories were divided and salespersons were assigned. The agreement defined applicable commission structures, travel expenses and procedures for referrals.

In his certification, Nanda claimed that he was in frequent contact with defendant's president, Carl Eikhoff, vice-president, John Carr, and other Magnum employees. He also asserted that, in addition to telephone contacts, he met with Eikhoff and Carr in New Jersey. He further noted that Magnum had deposited monies in plaintiff's New Jersey bank account. Although the facts are sketchy, evidence was also presented indicating that Keyes was the originator of the Lomas Bank account. Keyes apparently resigned from his position in December 1987 and, although a resident of New Jersey during his employment term, was not asked to submit an affidavit or certification relating to his activities with reference to the joint venture.

In support of its claim of jurisdiction, plaintiff pointed to other contacts defendant had with New Jersey which did not specifically relate to the causes of action alleged in the complaint. Specifically, plaintiff asserted that defendant had many large corporate clients in New Jersey which it identified. Plaintiff sought to characterize these contacts as "continuous and systematic."

Defendant countered that it had no contacts with New Jersey regarding the referral commissions and conference disputes. Defendant conceded that Keyes had originated the Lomas Bank account. Defendant also claimed that the Knight Group, a Florida based marketing organization, serviced the Marshall Fields account. Without elaborating further on the point, defendant contended that commissions had already been paid on the Marshall *567 Fields account and that some of the monies had been disbursed to Peter Profit, one of plaintiff's employees. Defendant asserted that it had little or no contact with New Jersey after Keyes' departure in 1987.

As we noted earlier, the Law Division concluded that defendant was not subject to suit in New Jersey because the causes of action alleged in plaintiff's complaint had no connection with this State. In reaching this conclusion, the court emphasized that defendant owned no tangible property in New Jersey and, thus, a judgment entered against it would be worthless. The court also concluded that even if New Jersey had jurisdiction, it would be improper to exercise its power to adjudicate the dispute because most of the key witnesses resided elsewhere.

II.

We first consider the question of whether New Jersey has personal jurisdiction over the defendant.

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Bluebook (online)
632 A.2d 298, 267 N.J. Super. 560, Counsel Stack Legal Research, https://law.counselstack.com/opinion/creative-business-v-magnum-njsuperctappdiv-1993.