LaRocca's Auto Sales Floorplan, Inc. v. Shelton

27 So. 3d 953, 2009 WL 3447606
CourtLouisiana Court of Appeal
DecidedNovember 4, 2009
DocketNo. 09-CA-143
StatusPublished

This text of 27 So. 3d 953 (LaRocca's Auto Sales Floorplan, Inc. v. Shelton) 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
LaRocca's Auto Sales Floorplan, Inc. v. Shelton, 27 So. 3d 953, 2009 WL 3447606 (La. Ct. App. 2009).

Opinion

MARC E. JOHNSON, Judge.

12The Plaintiff, LaRocca’s Auto Sales Floorplan, Inc., appeals a judgment granting an exception of lack of personal jurisdiction to New Texas Auto Auction Services, L.P., d/b/a DFW Auto Auction, Anita Tijerina, Theresa Walker, Erika Ruvalca-ba, and American National General Insurance Company (the Texas Defendants) in a suit involving car titles. We affirm.

In June of 2007, the Plaintiff filed suit against various Defendants alleging that they had engaged in a scheme that resulted in the Plaintiffs loss of security that Plaintiff provided for the purchase of automobiles in Louisiana and Texas. The suit named as Defendants: Greg Shelton, Chanon Ingles, PC & T-105, L.L.C. d/b/a Performance Cars and Truck Company, located in Monroe, Louisiana (Performance);Kimberly Sayes, a notary public in Ouachita Parish in Louisiana (Sayes); and New Texas Auto Auction Services, L.P., d/b/a DFW Auto Auction, |sAnita Tijerina, Theresa Walker, Erika Ruvalcaba, and American National General Insurance Company, residents of Texas (the “Texas Defendants”).

The petition asserts that, in 2004, Performance was engaged in selling used cars and recreational vehicles, and that the Plaintiff and Performance entered into an inventory vehicles agreement, known as a “floorplanning” agreement (the Agreement). Under the Agreement, the Plaintiff advanced money for vehicles that Per-[955]*955formanee located and purchased. The Plan included vehicles obtained from the Dallas-Fort Worth Auto Auction in Texas. After the vehicles were acquired with the money provided by the Plaintiff, the Plaintiff held the titles as a security lien. Performance was also required to execute and file a UCC-A financing statement. After the vehicles were sold, Performance repaid the Plaintiff and the Plaintiff then returned the title on that vehicle.

The Plaintiff alleges that the program did well for eighteen months, but in June, July and August of 2006, checks issued by Performance were returned by the bank for insufficient funds (NSF). As a result, the Plaintiff allegedly performed an audit of the vehicle inventory, and discovered that many of the floorplanned vehicles were not accounted for, and were either hidden from the floorplanned property or sold. The Plaintiff contended that the owners of Performance refused to divulge the location of the missing vehicles.

The Plaintiff further alleged that after further investigation, it discovered that many consumers that had filed complaints asserting they had not received a title, but later received them. Further, some, if not all, of the vehicles that the Plaintiff was holding the titles on had been sold and new titles issued to Performance without any repayment to the Plaintiff. The Plaintiff asserts that those new titles were “cleaned” or fraudulently issued in a scheme to bypass the Agreement, and to deprive the Plaintiff of the money Performance owed to it.

14The Plaintiff named Sayes and the Texas Defendants in the lawsuit, alleging that they were in collusion with Performance by signing fraudulent affidavits that allowed repossessed vehicles to obtain clear titles.

The Plaintiff further asserts in the petition that the transactions between the Plaintiff and Performance took place at the Plaintiffs “Floorplan” office in Metairie, Louisiana, and that the transactions included the delivery of original Texas titles.

The Defendants filed various and separate exceptions. After a hearing in December of 2007, on December 19, 2007, the trial judge granted Performance’s exception of lis pendens, Sayes’ exception of improper venue, and the Texas Defendants’ exceptions of lack of personal jurisdiction. He subsequently transferred the action against Sayes to Ouachita Parish. All other exceptions were declared moot. The Plaintiff timely filed an appeal.1

On appeal, the Plaintiff asserts that the trial judge erred in granting the exception of lack of personal jurisdiction filed by the Texas Defendants.

Due process requires that the defendant must have certain minimum contacts with the forum state in order to subject a nonresident defendant to a personal judgment, such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice. International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945); A & L Energy, Inc. v. Pegasus Group, 00-3255, p. 4 (La.6/29/01), 791 So.2d 1266, 1270, cert. denied, 534 U.S. 1022, 122 S.Ct. 550, 151 L.Ed.2d 426 (2001); Ruppert v. George Kellett & Sons, Inc., 08-182, p. 8 (La.App. 5 Cir. 9/30/08), 996 So.2d 501, 506.

There are two parts to the due process test-“minimum contacts” and “traditional notions of fair play and substantial justice.” A & L Energy, Inc., 00-3255 at 4-5, [956]*956791 So.2d at 1270-71; Ruppert, 08-182 at 8, 996 So.2d at 506.

| r)The Courts have held that the minimum contacts prong is satisfied “by a single act or actions by which the defendant ‘purposefully avails itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws.’ ” Southeast Wireless Network, Inc. v. U.S. Telemetry Corp., 06-1786, p. 4 (La.4/11/07), 954 So.2d 120, 125, citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 2183, 85 L.Ed.2d 528 (1985); Ruppert, 08-182 at 8, 996 So.2d at 506. “Purposeful availment” must be such that the defendant “should reasonably anticipate being haled into court” in the forum state. Southeast Wireless Network, Inc., 06-1736 at 5, 954 So.2d at 125, citing Ruckstuhl v. Owens Corning Fiberglas Corporation, 98-1126 (La.4/13/99), 731 So.2d 881, cert. denied, 528 U.S. 1019, 120 S.Ct. 526, 145 L.Ed.2d 407 (1999); Ruppert, 08-182 at 8, 996 So.2d at 506. “Purposeful availment” ensures that the moving party will not be haled into a jurisdiction solely as a result of a random, fortuitous or attenuated contact, or by the unilateral activity of another party or a third person. Southeast Wireless Network, Inc., 06-1736 at 5, 954 So.2d at 125. (Citations omitted); Ruppert, 08-182 at 8, 996 So.2d at 506.

The Southeast Wireless Network court explained:

If the defendant deliberately engages in significant activities within a state, or creates continuing obligations between himself and residents of the forum, he manifestly has availed himself of the privilege of conducting business there. Because his activities are shielded by the benefits and protections of the forum’s laws, it is presumptively not unreasonable to require the defendant to submit to the burdens of litigation in that forum.

Southeast Wireless Network, Inc., 06-1736 at 5, 954 So.2d at 125, citing de Reyes v. Marine Management and Consulting, Ltd., 586 So.2d 103, 106 (La.1991).

The foreseeability of causing an injury in another State is not a “sufficient benchmark” for exercising personal jurisdiction, Burger King Corp. v. Rudzewicz, 471 U.S. at 474, 105 S.Ct. at 2174; Ruppert, 08-182 at 8, 996 So.2d at 506.

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Related

International Shoe Co. v. Washington
326 U.S. 310 (Supreme Court, 1945)
World-Wide Volkswagen Corp. v. Woodson
444 U.S. 286 (Supreme Court, 1980)
Burger King Corp. v. Rudzewicz
471 U.S. 462 (Supreme Court, 1985)
Southeast Wireless v. US Telemetry
954 So. 2d 120 (Supreme Court of Louisiana, 2007)
A & L ENERGY, INC. v. Pegasus Group
791 So. 2d 1266 (Supreme Court of Louisiana, 2001)
Ruppert v. George Kellett & Sons, Inc.
996 So. 2d 501 (Louisiana Court of Appeal, 2008)
Ruckstuhl v. Owens Corning Fiberglas Corp.
731 So. 2d 881 (Supreme Court of Louisiana, 1999)
Simmons v. Templeton
684 So. 2d 529 (Louisiana Court of Appeal, 1996)
De Reyes v. Marine Mgt. and Consulting
586 So. 2d 103 (Supreme Court of Louisiana, 1991)
Smith Stag, L.L.C. v. Wilson & Meyer Custom Theater Interiors, L.L.C.
6 So. 3d 921 (Louisiana Court of Appeal, 2009)
Natsios v. National Foreign Trade Council
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Bluebook (online)
27 So. 3d 953, 2009 WL 3447606, Counsel Stack Legal Research, https://law.counselstack.com/opinion/laroccas-auto-sales-floorplan-inc-v-shelton-lactapp-2009.