Schubert v. Gay & Taylor, Inc.

716 F. Supp. 1129, 1989 U.S. Dist. LEXIS 9393, 1989 WL 89869
CourtDistrict Court, N.D. Illinois
DecidedAugust 7, 1989
Docket89 C 1090
StatusPublished
Cited by3 cases

This text of 716 F. Supp. 1129 (Schubert v. Gay & Taylor, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Schubert v. Gay & Taylor, Inc., 716 F. Supp. 1129, 1989 U.S. Dist. LEXIS 9393, 1989 WL 89869 (N.D. Ill. 1989).

Opinion

ORDER

BUA, District Judge.

On May 31, 1989, this court dismissed this case when plaintiff’s counsel failed to appear for a status hearing. At this time, the court grants plaintiff’s motion to vacate the order dismissing the case for want of prosecution. Having reinstated the case, the court will now consider defendant’s motion to dismiss or transfer the case. For the reasons stated herein, this court grants defendant’s motion to dismiss.

FACTS

Defendant Gay & Taylor, Inc. (“G & T”), a complete risk services company incorporated in North Carolina, 1 maintains its principal place of business in Winston-Salem, North Carolina. G & T has offices in 24 states, including Illinois, Georgia, and South Carolina. Defendant T. Bruce Tilley has served as President of G & T since December 1985. Tilley resides in Winston-Salem, North Carolina.

In 1986, Forum Insurance Co. (“FIC”) entered into contract negotiations with G & T. FIC proposed to retain G & T to adjust approximately 5,000 claim files previously handled by Quantex, Inc. In response to this proposal, G & T agreed to establish an office in Atlanta, Georgia for the purpose of managing FIC’s claim files. Moreover, in order to induce FIC to enter into a contract, G & T promised to hire an experienced insurance adjuster to manage the new Atlanta office. Then in October 1986, Tilley met with plaintiff R.T. Schubert in Schaumburg, Illinois. Schubert, an experi *1130 enced insurance adjuster who currently lives in Akron, Ohio, had worked at G & T’s office in Myrtle Beach, South Carolina since June 1986. During their meeting in Schaumburg, Tilley informed Schubert of G & T’s plans to open a new Atlanta office following the successful completion of contract negotiations with FIC. Tilley then offered Schubert the position of Atlanta office manager. According to Tilley, Schubert would begin this new job as soon as the Atlanta office opened. To persuade Schubert to accept the Atlanta assignment, Tilley allegedly indicated that G & T would pay Schubert $8,000 a month plus living and travel expenses from the time he started working in Atlanta until October 28, 1987. Based on these representations, Schubert accepted Tilley’s offer. A few weeks later, when contract talks between G & T and FIC resumed, G & T stated that it had hired an experienced insurance adjuster to manage the Atlanta office it planned to establish. Shortly thereafter, in January 1987, G & T and FIC reached agreement on a contract.

Relying on the representations Tilley made in Schaumburg, Schubert postponed a planned foreign trip, moved from Myrtle Beach to Atlanta, and began working at G & T’s new Atlanta office in January 1987. Then on February 10, 1987, G & T terminated Schubert. Despite losing his job, Schubert insisted that he should continue to receive his monthly salary of $8,000 through October 1987. G & T repeatedly rejected Schubert’s requests for payment following his termination. According to the complaint, G & T also refused to reimburse Schubert for various expenses he incurred during his employment at G & T’s offices in Myrtle Beach and Atlanta.

DISCUSSION

Schubert’s three-count complaint essentially alleges that defendants used Schubert’s expertise to attract FIC’s business, then discarded him after FIC signed a contract with G & T. Count I of the complaint alleges that G & T breached its October 1986 employment contract with Schubert by failing to pay his monthly salary after terminating him. Count II asserts that Schubert suffered damages because he reasonably relied on misrepresentations made by Tilley. Finally, in Count III, Schubert seeks reimbursement of expenses he incurred while working for G & T in Myrtle Beach and Atlanta.

In response to these claims, defendants move to dismiss Schubert’s complaint. They contend that this court lacks personal jurisdiction over Tilley. Defendants also argue that venue does not properly lie in Illinois. Alternatively, pursuant to 28 U.S.C. § 1404(a), defendants move to transfer this case to the United States District Court for the Northern District of Georgia.

In analyzing defendants’ motion to dismiss, this court would normally decide the issue of personal jurisdiction before considering the propriety of venue. Nonetheless, “when there is a sound prudential justification for doing so, ... a court may reverse the normal order of considering personal jurisdiction and venue.” Leroy v. Great Western United Corp., 443 U.S. 173, 180, 99 S.Ct. 2710, 2715, 61 L.Ed.2d 464 (1979). To determine whether it can exercise personal jurisdiction over Tilley, this court would have to resolve a close question concerning the application of the fiduciary shield doctrine. Under this doctrine, an Illinois court may not assert personal jurisdiction over an individual whose sole contact with the state consisted of acts he performed as a fiduciary of a corporation. Olinski v. Duce, 155 Ill.App.3d 441, 443-44, 108 Ill.Dec. 237, 239, 508 N.E.2d 398, 400 (1987). Arguably, the fiduciary shield doctrine insulates Tilley from the jurisdiction of any court in Illinois; but state law does not clearly dictate such a result. To complicate matters further, an Illinois appellate court recently reversed a lower court’s ruling that application of the fiduciary shield doctrine is mandatory. The appellate court ruled that Illinois courts may exercise discretion when determining whether to apply the fiduciary shield doctrine to a particular case. Washburn v. Becker, Nos. 1-88-0889, 1-88-2621, — Ill. App.3d-, — Ill.Dec.-, — N.E.2d -(Ill.App. July 17, 1989). This recent *1131 ruling only increases the uncertainty surrounding the applicability of the fiduciary shield doctrine in Tilley’s case. Therefore, rather than grapple with a thorny jurisdictional issue involving a legal doctrine that continues to evolve, this court will initially examine the question of venue. Ultimately, the court need not resolve the difficult issue of personal jurisdiction because Schubert has chosen an inappropriate venue for his lawsuit.

Federal jurisdiction over Schubert’s complaint rests entirely on diversity of citizenship. Consequently, to maintain an action in federal court, Schubert may bring suit “only in the judicial district where all plaintiffs or all defendants reside, or in which the claim arose.” 28 U.S.C. § 1391(a). Schubert does not reside in the Northern District of Illinois; neither do the two defendants. 2 Thus, Schubert can bring suit in this court only if his claims arose in this district.

When analyzing the question of where a claim arose, federal courts have employed a variety of tests. 3 In recent years, however, most courts (including this one) have adopted a “weight of contacts” test for determining the site where a claim arose.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Saktides v. Cooper
742 F. Supp. 382 (W.D. Texas, 1990)
Fink v. Declassis
738 F. Supp. 1195 (N.D. Illinois, 1990)
Torco Oil Co. v. Innovative Thermal Corp.
730 F. Supp. 126 (N.D. Illinois, 1989)

Cite This Page — Counsel Stack

Bluebook (online)
716 F. Supp. 1129, 1989 U.S. Dist. LEXIS 9393, 1989 WL 89869, Counsel Stack Legal Research, https://law.counselstack.com/opinion/schubert-v-gay-taylor-inc-ilnd-1989.