Shequita Avery v. Purdue University-IPFW (mem. dec.)

• Court: Indiana Court of Appeals
• Decided: February 29, 2016
• Docket: 02A05-1505-SC-457
• Status: Published

Opinion

MEMORANDUM DECISION Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision shall not be regarded as precedent or cited before any Feb 29 2016, 9:16 am

court except for the purpose of establishing the defense of res judicata, collateral estoppel, or the law of the case.

ATTORNEY FOR APPELLANT Thomas L. Stucky Blume, Connelly, Jordan, Stucky & Lauer, LLP Fort Wayne, Indiana

IN THE COURT OF APPEALS OF INDIANA

Shequita Avery, February 29, 2016 Appellant-Defendant, Court of Appeals Case No. 02A05-1505-SC-457 v. Appeal from the Allen Superior Court Purdue University-IPFW, The Honorable Jennifer DeGroote, Appellee-Plaintiff Magistrate Trial Court Cause No. 02D03-1409-SC-15200

Robb, Judge.

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 1 of 9 Case Summary and Issue [1] Purdue University–IPFW (“IPFW”) filed a small claims action against

Shequita Avery to recover scholarship funds IPFW contends were erroneously

applied to Avery’s financial aid account. Avery filed a motion to dismiss

IPFW’s complaint for lack of personal jurisdiction. The small claims court

denied Avery’s motion to dismiss and certified the matter for interlocutory

appeal. We accepted jurisdiction. Concluding the small claims court erred in

denying Avery’s motion to dismiss, we reverse and remand.

Facts and Procedural History [2] Avery is a lifetime resident of Alabama and single mother of four children. She

is employed as a phlebotomist and earns approximately $18,000.00 per year.

Her father, an Army veteran, has resided in Indiana since 1973 and lives with a

service-connected disability. He travels to Alabama to visit Avery and his

grandchildren for holidays. Avery has never been to Indiana.

[3] In 2013, the Indiana Department of Veterans’ Affairs (“DVA”) informed

Avery’s father that his children may be eligible for tuition assistance through

Indiana’s Child of a Disabled Veteran Program (known as CVO). See Ind.

Code §§ 21-14-4-1 to -8. Avery contacted the DVA to inquire about her

eligibility as an Alabama resident. According to Avery, a DVA representative

told her the scholarship would only be approved for the cost of in-state tuition

and that a state university could, in its discretion, accept the scholarship for a

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 2 of 9 non-resident. Avery requested an application from the DVA and applied for a

CVO scholarship. Under the “Student Data” section, Avery listed an Alabama

address and an Alabama phone number. Appendix of Appellant at 17. The

DVA certified Avery’s eligibility, and Avery registered for online classes with

IPFW. IPFW awarded Avery a CVO scholarship totaling $3,117.00, which

covered the cost of tuition for Avery’s spring 2014 semester because IPFW does

not distinguish between residents and non-residents for online class tuition.

[4] Several months later, in April, IPFW rescinded the scholarship, citing Avery’s

non-resident status. The Assistant Director of Financial Aid sent Avery an

email stating Avery was ineligible for the scholarship and that it was not clear

from the CVO paperwork that Avery is a resident of Alabama. At this point in

the semester, Avery was not permitted to withdraw and owed IPFW the full

scholarship amount.

[5] In September 2014, IPFW sued Avery in small claims court for the amount of

the scholarship plus $1,000.00 in attorney fees and $94.00 in court costs, for a

total of $4,198.00. Rather than file an answer, Avery filed a motion to dismiss

for lack of personal jurisdiction under Indiana Trial Rule 12(B)(2). IPFW did

not file a response. The small claims court held a hearing and denied Avery’s

motion to dismiss. Thereafter, Avery filed a motion to certify the matter for

interlocutory appeal pursuant to Indiana Appellate Rule 14(B). The small

claims court certified its order denying Avery’s motion to dismiss on April 22,

2015, and we accepted jurisdiction over the appeal on July 6, 2015.

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 3 of 9 Discussion and Decision I. Standard of Review [6] Avery contends the small claims court erred in denying her motion to dismiss

for lack of personal jurisdiction under Indiana Trial Rule 12(B)(2). Jurisdiction

is presumed in Indiana and need not be alleged in the complaint. MBNA Am.

Bank, N.A. v. Rogers, 835 N.E.2d 219, 221 (Ind. Ct. App. 2005), trans. denied.

Unless a lack of jurisdiction is apparent on the face of the complaint, the party

challenging jurisdiction has the burden of establishing the lack thereof by a

preponderance of the evidence. Attaway v. Omega, 903 N.E.2d 73, 76 (Ind. Ct.

App. 2009).

The legal question of whether personal jurisdiction exists given a set of facts is reviewable de novo. However, the presence of personal jurisdiction is based on the existence of jurisdictional facts. When determining these facts, the trial court is performing its classic fact-finding function, often evaluating the character and truthfulness of witnesses, and is in a better position to determine these issues than a reviewing court. For this reason, a trial court’s findings of jurisdictional facts are generally reviewed for clear error.

Anthem Ins. Cos., Inc. v. Tenet Healthcare Corp., 730 N.E.2d 1227, 1238 (Ind.

2000), superseded by rule on other grounds.

[7] It appears, however, that the small claims court did not make any findings of

jurisdictional facts. We have previously held, “Where the trial court did not

find jurisdictional facts, we may accept the plaintiff’s well-pleaded facts to the

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 4 of 9 extent they are not challenged, and we may view challenged facts in favor of the

plaintiff.” JPMorgan Chase Bank, N.A. v. Desert Palace, Inc., 882 N.E.2d 743, 747

(Ind. Ct. App. 2008), trans. denied. But the complaint here does not mention

any facts relevant to the jurisdiction question. The complaint indicates IPFW

filed an “account” claim against Avery, but the section that is supposed to

contain “[a] brief statement of the nature of the claim” merely states, “Pursuant

to IC 33-37-3-1 and IC 21-14-2-11, Plaintiff may collect attorney fees and

collection costs. Defendant is therefore liable for the principal amount of

$3117.00, attorney fees in the amount of $1000.00, plus interest and costs.”

Supplemental Appendix of Appellant at 1. IPFW did not file a response to

Avery’s motion to dismiss, nor a brief in this appeal—meaning IPFW has never

challenged Avery’s account of the underlying facts. In this situation, we have

no choice but to accept the facts as Avery presented them in her motion to

dismiss.

[8] Finally, we note that when an appellee fails to submit a brief, we do not

undertake the burden of developing an argument on its behalf. Trinity Homes,

LLC v. Fang, 848 N.E.2d 1065, 1068 (Ind. 2006). Instead, we review for prima

facie error; that is, error “at first sight, on first appearance, or on the face of it.”

Id. (citation omitted).

II. Personal Jurisdiction [9] Personal jurisdiction refers to a court’s power to impose judgment on a

particular defendant. Boyer v. Smith, 42 N.E.3d 505, 509 (Ind. 2015). Indiana

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 5 of 9 Trial Rule 4.4(A) sets out examples of activities that often support jurisdiction,

but it also includes a “catchall” provision permitting the exercise of jurisdiction

“on any basis not inconsistent with the Constitutions of this state or the United

States.” Id. (quoting Ind. Trial Rule 4.4(A)). In LinkAmerica Corp. v. Cox, 857

N.E.2d 961 (Ind. 2006), our supreme court held this “catchall” provision

“reduce[s] analysis of personal jurisdiction to the issue of whether the exercise

of personal jurisdiction is consistent with the Federal Due Process Clause.” Id.

at 966-67.

[10] Before an Indiana court can properly assert personal jurisdiction over a

defendant, the Due Process Clause of the Fourteenth Amendment requires that

the defendant have certain “minimum contacts” with the state “such that the

maintenance of the suit does not offend traditional notions of fair play and

substantial justice.” Id. at 967 (quoting Int’l Shoe Co. v. Wash., 326 U.S. 310, 316

(1945)) (internal quotation marks omitted). If the defendant’s contacts with the

state are so “continuous and systematic” that the defendant should reasonably

anticipate being haled into the state’s courts for any matter, the defendant is

subject to general jurisdiction. Id. (citing Helicopteros Nacionales de Colombia, S.A.

v. Hall, 466 U.S. 408, 415 n.9 (1984)). If the defendant’s contacts with the state

are not “continuous and systematic,” the defendant may be subject to specific

jurisdiction “if the controversy is related to or arises out of the defendant's

contacts with the forum state.” Id. (citing Helicopteros, 466 U.S. at 414 & n.8).

[11] Specific jurisdiction requires purposeful availment. Id. The defendant’s

contacts must include some action by which the defendant “purposefully

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 6 of 9 avails” herself of “the privilege of conducting activities within the forum State,

thus invoking the benefits and protections of its laws.” Anthem, 730 N.E.2d at

1233-34 (quoting Hanson v. Denckla, 357 U.S. 235, 253 (1958)). A single contact

with the forum state may be sufficient to establish specific jurisdiction if the

contact creates a “substantial connection” with the forum state and the suit

arises from that connection. LinkAmerica, 857 N.E.2d at 967 (quoting McGee v.

Int’l Life Ins. Co., 355 U.S. 220, 223 (1957)). When evaluating a defendant’s

contacts with the forum state, a court should consider:

(1) whether the plaintiff’s claim arises from the defendant’s forum contacts; (2) the overall contacts of the defendant or its agent with the forum state; (3) the foreseeability of being haled into court in that state; (4) who initiated the contacts; and (5) whether the defendant expected or encouraged contacts with the state.

Wolf’s Marine, Inc. v. Brar, 3 N.E.3d 12, 15 (Ind. Ct. App. 2014).

[12] But even if a defendant’s contacts are sufficient to confer jurisdiction, due

process requires the assertion of jurisdiction over the defendant be reasonable.

LinkAmerica, 857 N.E.2d at 967. Reasonableness of exercising jurisdiction over

a defendant is determined by weighing the following factors:

(1) the burden on the defendant; (2) the forum State’s interest in adjudicating the dispute; (3) the plaintiff's interest in obtaining convenience and effective relief; (4) the interstate judicial system’s interest in obtaining the most efficient resolution of controversies; and (5) the shared interest of the several States in furthering fundamental substantive social policies.

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 7 of 9 Id. at 967-68 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476-77 (1985)).

“The fairness inquiry is separate from the contacts question and may be used to

defeat jurisdiction even if the defendant has sufficient contacts with the forum

state.” Brockman v. Kravic, 779 N.E.2d 1250, 1257 (Ind. Ct. App. 2002).

[13] We conclude Avery’s contacts with the State of Indiana are sufficient to

establish specific jurisdiction but that exercise of jurisdiction over Avery would

not be reasonable. Although Avery has never visited or resided in Indiana, she

contacted Indiana’s DVA to inquire about CVO scholarships. After speaking

with a DVA representative, Avery requested an application for the program.

Our state seal appears at the top of the application, which was titled “2013-14

Application for Remission of Fees for a Child of a Disabled Indiana Veteran or

a POW/MIA.” App. at 17. The application also states that the required

disclosure of applicants’ Social Security numbers complies with Indiana Code

section 4-1-8-1. Avery completed the application, submitted it to the DVA, and

accepted the scholarship that was offered. She then registered for online classes

with IPFW, a state university, and participated in the classes until IPFW

rescinded the scholarship. These contacts, albeit limited, were initiated by

Avery and gave rise to IPFW’s claim. Under these circumstances, Avery

purposely availed herself of the privilege of conducting activities in Indiana. See

Anthem, 730 N.E.2d at 1233-34.

[14] Nonetheless, we conclude the small claims court erred in denying Avery’s

motion to dismiss because the exercise of jurisdiction over Avery would offend

due process. Given our standard of review in this case, we believe Avery

Court of Appeals of Indiana | Memorandum Decision 02A05-1505-SC-457 | February 29, 2016 Page 8 of 9 demonstrated it would be unreasonable to require her to litigate in Indiana.

Avery is a single working mother of four children, ages three to fourteen years

old, and she earns only $18,000.00 per year. Requiring Avery to miss work,

arrange childcare, and travel to Indiana would create a substantial hardship that

would outweigh IPFW’s interest in obtaining convenient relief. Cf. McGee, 355

U.S. at 223-23 (holding the burden on individual insurance claimants who

likely cannot afford to litigate in foreign forums outweighs any inconvenience

suffered by an insurance company required to litigate in a state where it had no

offices and only one customer).1

Conclusion [15] Avery established prima facie error in the small claims court’s denial of her

motion to dismiss for lack of personal jurisdiction. We therefore reverse and

remand this case to the small claims court for proceedings consistent with this

opinion.

[16] Reversed and remanded.

Barnes, J., and Altice, J., concur.

1 Given the particular facts before us and our standard of review, the remaining reasonableness factors do not significantly favor or disfavor the exercise of jurisdiction in this case. See LinkAmerica, 857 N.E.2d at 967.

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