Tm Productions, Inc. v. Blue Mountain Broadcasting Co.

623 S.W.2d 427, 1981 Tex. App. LEXIS 4236
CourtCourt of Appeals of Texas
DecidedAugust 13, 1981
Docket20482
StatusPublished
Cited by19 cases

This text of 623 S.W.2d 427 (Tm Productions, Inc. v. Blue Mountain Broadcasting Co.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tm Productions, Inc. v. Blue Mountain Broadcasting Co., 623 S.W.2d 427, 1981 Tex. App. LEXIS 4236 (Tex. Ct. App. 1981).

Opinions

GUITTARD, Chief Justice.

The trial court dismissed this suit for lack of jurisdiction over the person of defendant. Plaintiff appeals, contending that defendant consented to jurisdiction in Texas and that defendant’s contacts with Texas were sufficient to satisfy due process. We hold that plaintiff did not properly raise the consent issue in the trial court and that the court’s finding of lack of minimum contacts is supported by the evidence. Consequently, we affirm.

Findings and Conclusions

We take our statement of facts from the trial court’s findings, which are not challenged. Plaintiff TM Productions, Inc. is a Texas corporation engaged in the business of making and selling musical commercials for radio and television stations. It sells its products to customers throughout the United States and around the world, through sales representatives living and working in their respective territories. Defendant Blue Mountain Broadcasting Company is an Idaho corporation which maintains its principal place of business in Oregon. Its owner and general manager is John H. Runkle, Jr. Having received brochures describing TM’s products, Runkle made a telephone call to TM’s office in Dallas inquiring about the availability of the products. He was advised that demonstration tapes would be sent. Not having received the merchandise, he made another telephone call. No further contacts occurred until approximately two months later, when TM’s sales representative visited Blue Mountain’s office in Oregon. On that occasion, Runkle, acting for Blue Mountain, signed two written contracts in the form of agreements licensing the use of TM’s products for a period of three years. On the reverse side of one of the contracts are the following printed provisions:

13. This agreement shall not be effective for any purpose until accepted and executed by an officer of TM in Dallas, Dallas County, Texas. This agreement shall be deemed to have [429]*429been entered into by both parties in Dallas, Dallas County, Texas.
15. This agreement shall be interpreted under the laws of the State of Texas and shall be performable at Dallas, Dallas County, Texas. Exclusive venue and jurisdiction of any dispute or suit arising hereunder shall lie within the courts of the State of Texas or within the courts of the United States of America located within the Northern District of Texas.

After the contracts were signed, TM mailed its products to Blue Mountain in Oregon. Blue Mountain made one payment on each contract by mail to TM’s Dallas Office. Blue Mountain has had no other contacts with the State of Texas.

Defendant Blue Mountain made its special appearance by a sworn plea to the jurisdiction, alleging that'it was not amenable to process issued by the Court of Texas because it was not a resident of Texas, had not engaged in business in Texas and had no agents, employees, or place of business in Texas. The plea further alleges that the contracts sued on were negotiated and executed in Oregon and that the products described by the contracts were delivered to the defendant in Oregon.

At the special appearance hearing, defendant offered in evidence the deposition of John H. Runkle, Jr., with the two contracts attached as exhibits. Other evidence was offered by plaintiff. The trial court made findings of fact and concluded that defendant did not purposely avail itself of the privilege of conducting activities in Texas, that defendant did not purposely invoke the benefits or protection of Texas laws, that defendant had insufficient minimum contacts with Texas, and that it would not be fair and reasonable to require defendant to come into Texas to defend the action. Accordingly, the court dismissed the suit.

Consent to Jurisdiction

On this appeal, plaintiff contends that defendant failed to establish its lack of amenability to process because one of the contracts in question contains an express consent to suit in Texas courts. Defendant replies that plaintiff cannot now assert jurisdiction of defendant’s person on the basis of such a consent because it did not plead consent as a ground of jurisdiction and did not otherwise raise that ground in the trial court. We agree.

The only ground of jurisdiction alleged in the petition is the following:

3. Defendant is doing business within the State of Texas by entering into contracts by mail with residents of the State of Texas to be performed in whole or in part by either party within the State of Texas. Defendant does not maintain a place of regular business in this State or a designated agent within the State of Texas upon whom service may be made upon causes of action arising out of the business done by Defendant in the State. Accordingly, Defendant has appointed the Secretary of the State of Texas as agent for Defendant upon whom service of process may be had in this suit.

Plaintiff asserts that this allegation is a sufficient ground of personal jurisdiction, and, since a sufficient ground is alleged, defendant, by its special appearance, assumed the burden of establishing its lack of amenability to service by both pleading and proof. Plaintiff insists that since the contract was offered in evidence and paragraph 15 was read to the court and admitted without objection, the consent to jurisdiction therein provided establishes Blue Mountain’s amenability to suit in Texas.

If the question were one of first impression, we would be inclined to reject plaintiff’s contention on the ground that at the special appearance hearing the only question under rule 120a is the defendant’s amenability to Texas process, as distinguished from the validity of the process issued and served, and that insufficiency of [430]*430the jurisdictional allegations of the petition affects the validity of the process rather than amenability to process. This view is based on the analysis of the problem by Professor E. Wayne Thode in In Personam Jurisdiction, Article 2031B, The Texas “Long Arm” Jurisdiction Statute; and the Appearance to Challenge Jurisdiction in Texas and Elsewhere, 42 Texas L.Rev. 279 (1964). As Professor Thode points out, before adoption of rule 120a, any appearance by a nonresident defendant was a general appearance, which subjected the defendant to the jurisdiction of the Texas court under the applicable statutes (later superseded by rules 121,122 and 123 of the Texas Rules of Civil Procedure), as interpreted and applied in York v. State, 73 Tex. 651, 11 S.W. 869 (1889), aff’d, York v. Texas, 137 U.S. 15, 11 S.Ct. 9, 34 L.Ed. 604 (1890). Consequently, a nonresident defendant was required either to defend the suit in Texas or to abandon his defense on the merits and attack the judgment on due process grounds if suit should be brought to enforce it in his home state.

This harsh rule was changed by rule 120a in only a limited respect.

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Tm Productions, Inc. v. Blue Mountain Broadcasting Co.
623 S.W.2d 427 (Court of Appeals of Texas, 1981)

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623 S.W.2d 427, 1981 Tex. App. LEXIS 4236, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tm-productions-inc-v-blue-mountain-broadcasting-co-texapp-1981.