Harry S. Peterson Co. v. NAT. UNION FIRE INSURANCE CO.

434 S.E.2d 778, 209 Ga. App. 585, 93 Fulton County D. Rep. 2924, 1993 Ga. App. LEXIS 945
CourtCourt of Appeals of Georgia
DecidedJuly 16, 1993
DocketA93A0564
StatusPublished
Cited by24 cases

This text of 434 S.E.2d 778 (Harry S. Peterson Co. v. NAT. UNION FIRE INSURANCE CO.) is published on Counsel Stack Legal Research, covering Court of Appeals of Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harry S. Peterson Co. v. NAT. UNION FIRE INSURANCE CO., 434 S.E.2d 778, 209 Ga. App. 585, 93 Fulton County D. Rep. 2924, 1993 Ga. App. LEXIS 945 (Ga. Ct. App. 1993).

Opinions

Andrews, Judge.

Appellant Harry S. Peterson Company, Inc. (Peterson) appeals from the order of the Fulton County Superior Court granting appellee National Union Fire Insurance Company’s (National) motion to dismiss for lack of subject matter jurisdiction and improper venue.

Harvey Construction Company, Inc. (Harvey), a Maryland corporation, entered into a contract in Virginia with Fairfax County, Virginia, for the construction of a parking deck at a metro-rail station. This public project is located entirely within Fairfax County, Virginia. Pursuant to Virginia law, Harvey was obligated to obtain a surety bond naming appellee National as surety and Fairfax County as obligee; this payment bond was signed in Maryland. Thereafter, Harvey entered into a subcontract with appellant Peterson, a Michigan corporation, to perform certain work on the project. The subcontract was signed in Maryland. No documents were signed or work performed under this contract in the State of Georgia.

In its complaint against National, alleging, inter alia, breach of contract, Peterson alleged it had not been paid for the work performed on the project; that National was obligated to Peterson as a claimant under the terms of the payment bond; that the superior court had personal jurisdiction over the defendant National, subject matter jurisdiction, and venue. National, a Pennsylvania corporation, answered, admitting that it was a Pennsylvania corporation qualified to do business in Georgia and that its registered agent in Georgia was the person served.

The payment bond contains the following clause: “[n]o claim or action shall be commenced hereunder by any claimant . . . [o]ther [586]*586than in a state court of competent jurisdiction in and for the country [sic] or other political subdivision of the state in which the Project, or any part thereof, is situated, or in the United States District Court for the district in which the project, or any part thereof, is situated and not elsewhere.”

1. The superior court had subject matter jurisdiction in this case in the “classic sense,” as that concept is defined in Vann v. DeKalb County Bd. of Tax Assessors, 186 Ga. App. 208, 209 (1) (367 SE2d 43) (1988). See, e.g., Ga. Const. 1983, Art. VI, Sec. IV, Par. I; OCGA § 15-6-8. Superior courts in this state have jurisdiction over the class of cases to which this case belongs, that is, suits for breach of payment bond contract, bad faith claims under OCGA § 10-7-30, and attorney fees.

2. The trial court, without discussing the requirement for adequately raising the defense of personal jurisdiction or the issue of waiver, observed that National in its answer “denied that personal jurisdiction exists” and found a lack of personal jurisdiction over Nátional. As the trial court unequivocally entertained the issue of personal jurisdiction, we consider this issue on appeal. Any issue of improper service, however, not having been expressly ruled on by the trial court and not raised by the parties is deemed abandoned. See Frymyer v. State, 179 Ga. App. 391 (3) (346 SE2d 573) (1986).

(a) The trial court concluded that due process concerns require dismissal of the suit for lack of personal jurisdiction, because there was a lack of minimum contact with Georgia so as to cause National reasonably to anticipate being hailed into court in Georgia; that there was insufficient evidence to establish whether the claim had any relation to or otherwise could have reasonably been expected to arise from minimum contacts; and that the exercise of jurisdiction in this case would not be reasonable and would violate notions of fair play and substantial justice. Underpinning these conclusions are the trial court’s findings that the only connection alleged with the State of Georgia is that National “does substantial business here.” Implicit in the trial court’s disposition is a finding that National is not a “resident” of Georgia for personal jurisdictional purposes.

(b) The trial court rejected Peterson’s contention that its claim under the payment bond constituted a transitory action and opined that “the controversy in this case does have a particular place where the contract is to be performed.” The controversy is between Peterson and National as to liability under the bond and not between Peterson and Harvey regarding the subcontract. While the bond does contain the clause quoted supra, the bond document does not limit the situs where any required or good faith bond payments ultimately would be made or where execution might be effected of any final payments justly due thereunder.

[587]*587“The term ‘transitory action’ comprehends in general those actions which at common law might be tried wherever personal service could be obtained upon the defendant. But if the cause of action is one that in its nature can arise in one place only, the action is local and suit can be brought only where the cause of action arose. In other words, an action is transitory where the transaction on which it is founded might have taken place anywhere; and it is local where the transaction is necessarily local, that is, could have happened only in a particular place. The distinction exists in the nature of the subject of the injury rather than in the means used or the place in which the cause of action arises.” 77 AmJur2d, Venue, § 2. Peterson’s claim is grounded upon a transitory rather than a local action. Compare Walrus Mfg. Co. v. New Amsterdam Cas. Co., 184 FSupp. 214 (S.D. Ill. 1960) (action on performance bond was transitory); Apartments, Inc. v. Trott, 342 P2d 32, 36 (3) (DCA Calif. 1959) (performance bond a personal and transitory action); see also Louisville &c. R. Co. v. Meredith, 66 Ga. App. 488, 492 (18 SE2d 51) (1941) (at common law personal actions, whether arising ex contractu or ex delicto, are transitory and may be brought in a state other than where the cause of action arose), aff’d 194 Ga. 106 (21 SE2d 101) (1942).

The record establishes that National was doing substantial business in this state, although Peterson’s claims did not arise from or out of the conduct of such business in Georgia. In Georgia, the following general rules apply regarding jurisdiction over foreign corporations as to transitory causes of action. “The general jurisdiction of State courts extends to transitory causes of action arising in another State, even though the plaintiff may not have been a resident of the State where the cause of action arose and the defendant may be a foreign corporation, so long as it is confined to the field from which the State itself is not excluded under the provisions of the United States constitution.” Louisville, supra. A foreign corporation is present in any place where its officers or agents transact business in behalf of the corporation under authority conferred by it. Reeves v. Southern R. Co., 121 Ga. 561, 565 (49 SE 674) (1905). A foreign corporation may be sued on a transitory cause of action in any jurisdiction where it can be found in the sense that service may be perfected upon an agent or officer transacting business for the corporation within that jurisdiction, and the residence of the plaintiff and the place at which the cause of action arises are not issues material to jurisdiction if the corporation can be found and served. Reeves, supra.

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Bluebook (online)
434 S.E.2d 778, 209 Ga. App. 585, 93 Fulton County D. Rep. 2924, 1993 Ga. App. LEXIS 945, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harry-s-peterson-co-v-nat-union-fire-insurance-co-gactapp-1993.