Drilling Engineering, Inc. v. Independent Indonesian American Petroleum Co.

271 So. 2d 285, 1972 La. App. LEXIS 6750
CourtLouisiana Court of Appeal
DecidedDecember 13, 1972
DocketNo. 4021
StatusPublished
Cited by3 cases

This text of 271 So. 2d 285 (Drilling Engineering, Inc. v. Independent Indonesian American Petroleum Co.) 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
Drilling Engineering, Inc. v. Independent Indonesian American Petroleum Co., 271 So. 2d 285, 1972 La. App. LEXIS 6750 (La. Ct. App. 1972).

Opinion

CULPEPPER, Judge.

This is a suit for the balance due under a contract pursuant to which plaintiff furnished engineering services to defendant. Defendant, a nonresident corporation, filed an exception to the court’s jurisdiction in personam, which was sustained by the district judge. Plaintiff appealed.

The issue is whether Louisiana has jurisdiction in personam over the defendant under our Long Arm Statute, LSA-R.S. 13:3201, which provides in pertinent part that “A court may exercise personal jurisdiction over a nonresident, who acts directly or by an agent, as to a cause of action arising from the nonresident’s (a) transacting any business in this state

There is no dispute as to the facts. The defendant, Independent Indonesian American Petroleum Company, is a corporation organized under the laws of the State of Delaware, with its principal office and place of business in San Francisco, California. Its principal business is exploration for and production of petroleum products in Indonesia. In connection with this work, defendant needed operational engineers. It contacted plaintiff, Drilling Engineering, Inc., a Louisiana corporation with offices in Lafayette, whose business is furnishing such engineers.

Mr. Paul C. Smith, Jr., defendant’s vice-president in charge of production, went to Lafayette, Louisiana, where he met with Mr. David G. Williams, plaintiff’s president, on one occasion for two or three hours. During this conference the parties agreed generally on the terms and conditions of the contract by which plaintiff was to furnish engineering services to defendant for the sum of $150 per day per engineer plus expenses, with the understanding that the agreement would later be reduced to writing and signed.

Thereafter, the agreement was written in Louisiana by Mr. Williams in letter form and mailed to Mr. Smith in San Francisco, California for approval. Mr. Smith made a change in the agreement so as to provide that defendant would carry workmen’s compensation insurance on the engineers according to California law. With this change, Mr. Smith signed the agreement and mailed it back to Lafayette, Louisiana, where it was signed by Mr. Williams on behalf of plaintiff.

During the next several months, plaintiff sent engineers from Lafayette, Louisiana, to Indonesia, where they performed for defendant services stipulated in the contract. Certain payments were made under the contract by checks of defendant mailed from California to plaintiff’s office in Lafayette. Plaintiff filed this suit alleging there is a balance of $5,400 due and unpaid.

The defendant is not authorized to do business in Louisiana, has never had an office or place of business in Louisiana and has never had any agents or representatives in Louisiana, except for the visit made by Mr. Smith to Lafayette to negotiate the agreement sued on. Furthermore, none of the services furnished under the contract were performed in Louisiana. The engineers did all of their work in Indonesia.

In the original contract, defendant agreed to forward to plaintiff in Louisiana plane tickets for the necessary travel of the engineers to Indonesia and also to reimburse personal travel expenses for these trips. However, this part of the contract was not followed. Plaintiff actually furnished the plane tickets for its engineers and invoiced defendant for these and other travel expenses.

The contract pertinently provides that the engineers would be paid at the rate of $150 per day, “the time to begin upon leaving Lafayette, and upon returning to Lafayette, Louisiana for each engineer.”

' In addition to the engineering services furnished in Indonesia under the contract, a special study of its drilling and operational problems was requested by defendant [287]*287and these services were performed in defendant’s office in Lafayette.

Our Long-Arm Statute, LSA-R.S. 13:-3201 provides as follows:

“A court may exercise personal jurisdiction over a nonresident, who acts directly or by an agent, as to a cause of action arising from the nonresident’s
“(a) transacting any business in this state;
(b) contracting to supply services or things in this state;
(c) causing injury or damage by an offense or quasi offense committed through an act or omission in this state;
(d) causing injury or damage in this state by an offense or quasi offense committed through an act or omission outside of this state if he regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered, in this state; or
(e) having an interest in, using, or possessing a real right or immovable property in this state.”

Plaintiff does not contend that subsections (b), (c), (d) or (e) of the statute are applicable. The sole contention is that under subsection (a) the cause of action sued on arises from defendant’s “transacting any business in this state.”

Plaintiff emphasizes the comments of the Louisiana Law Institute under LSA-R.S. 13:3201 that its purpose is to permit the courts of this State to tap the full potential of jurisdiction in personam over nonresidents permitted by International Shoe Company v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95, 161 A.L.R. 1057 (1945); and McGee v. International Life Insurance Company, 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957). A discussion from 27 A.L.R.3d 428 is quoted to support the proposition that a long-arm statute requiring only transacting “any” business is broader than one requiring “doing business”, and that “any” business could consist of a single isolated business transaction.

Appellant cites Aucoin v. Hanson, 207 So.2d 834 (La.App., 3rd Cir. 1968) in which a Louisiana plaintiff sought to recover the purchase price of a defective horse bought from a Mississippi seller. The facts showed that the Mississippi defendant had engaged in non-related Louisiana racing and horse breeding activities. Plaintiff first became interested in buying the mare through a Louisiana horse trainer, who had formerly worked for the Mississippi seller. This horse trainer communicated to defendant in Mississippi plaintiff’s desire to buy a horse. Defendant made a long distance call to plaintiff in Louisiana, in which they agreed on the sale. The mare was delivered from Mississippi to the plaintiff in Louisiana. There was a forceful dissent arguing that defendant did not have sufficient contact with Louisiana, but the majority held this state had jurisdiction.

Although the court in Aucoin v. Hanson found jurisdiction under subsection (a) of the statute, the author of the article in 29 La. Law Review 271-276 (now Justice Tate of our Supreme Court) points out that the decision could as well, or perhaps better, have been based on subsection (b) of the statute, which grants jurisdiction as a result of defendant’s “contracting to supply services or things in this state.” A majority of our Supreme Court has consistently recognized that for jurisdictional purposes there is a distinction between a business transaction in which the nonresident is the seller and one in which he is the buyer, Riverland Hardwood Company v.

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Related

Drilling Eng., Inc. v. Independent Indon. Amer. Pet. Co.
283 So. 2d 687 (Supreme Court of Louisiana, 1973)
Salter v. Natchitoches Chiropractic Clinic
274 So. 2d 490 (Louisiana Court of Appeal, 1973)

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Bluebook (online)
271 So. 2d 285, 1972 La. App. LEXIS 6750, Counsel Stack Legal Research, https://law.counselstack.com/opinion/drilling-engineering-inc-v-independent-indonesian-american-petroleum-co-lactapp-1972.