Winnsboro Auto Ventures, LLC v. Santander Consumer USA, Inc.

CourtCourt of Appeals of Texas
DecidedApril 19, 2018
Docket05-17-00895-CV
StatusPublished

This text of Winnsboro Auto Ventures, LLC v. Santander Consumer USA, Inc. (Winnsboro Auto Ventures, LLC v. Santander Consumer USA, Inc.) 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
Winnsboro Auto Ventures, LLC v. Santander Consumer USA, Inc., (Tex. Ct. App. 2018).

Opinion

AFFIRM; and Opinion Filed April 19, 2018.

In The Court of Appeals Fifth District of Texas at Dallas No. 05-17-00895-CV

WINNSBORO AUTO VENTURES, LLC, Appellant V. SANTANDER CONSUMER USA, INC., Appellee

On Appeal from the 162nd Judicial District Court Dallas County, Texas Trial Court Cause No. DC-16-15149

MEMORANDUM OPINION Before Justices Bridges, Myers, and Schenck Opinion by Justice Schenck Winnsboro Auto Ventures, LLC (Winnsboro) appeals the trial court’s order denying its

special appearance in a suit instituted by Santander Consumer USA, Inc. (Santander) in Dallas

County. In two issues, Winnsboro argues it has insufficient contacts with Texas to support

jurisdiction in this case. We conclude that Winnsboro has sufficient minimum contacts with Texas

to support specific jurisdiction and the exercise of jurisdiction over Winnsboro does not offend

traditional notions of fair play and substantial justice. Accordingly, we affirm the trial court’s

order denying Winnsboro’s special appearance and remand the case to the trial court for further

proceedings consistent with this opinion. Because the dispositive issues in this case are settled in

law, we issue this memorandum opinion. TEX. R. APP. P. 47.4. BACKGROUND

This case involves a dispute between Santander, an Illinois corporation with its principal

place of business and headquarters in Dallas County, Texas, and automobile dealership

Winnsboro, a Louisiana corporation with its principal place of business in Louisiana. Santander

is in the business of purchasing automobile retail installment sales contracts from dealers like

Winnsboro. On or about April 16, 2014, Winnsboro and Santander entered into a Non–Recourse

Master Dealer Agreement (Agreement) whereby Winnsboro was entitled, but not obligated, to sell

automobile retail installment sales contracts to Santander.

Under the Agreement, Winnsboro had the option of submitting a proposal, including terms

and conditions, under which it would consider selling and assigning an installment sales contract

to Santander. After reviewing Winnsboro’s proposed terms and conditions and the applicable loan

documentation, Santander could elect to purchase the installment sales contract. Winnsboro,

however, controlled final approval of the sale, and could refuse the transaction notwithstanding

Santander’s agreement to purchase the installment sales contract. The Agreement had no specified

term, and was to be governed by and construed in accordance with Texas law. Winnsboro agreed

to indemnify Santander in the event of claims arising out of Winnsboro’s breach of or conduct

under the Agreement or the installment sales contracts.

Pursuant to the Agreement, Winnsboro solicited and sold numerous installment sales

contracts to Santander. This lawsuit arises out of Winnsboro’s alleged breach of the Agreement

as it relates to one installment sales contract arising from a vehicle Winnsboro sold (and Santander

financed) with a value of $33,165.33 (the “Contract”). Specifically, Santander alleges Winnsboro

breached the Agreement by failing to repurchase the Contract after it misrepresented the condition

of the vehicle and the equipment options included therewith, which resulted in the purchaser

returning the vehicle and demanding a refund. Santander obtained a no-answer default judgment

–2– against Winnsboro. Thereafter, Winnsboro filed a special appearance and moved for a new trial

subject to its special appearance.

Winnsboro supported its special appearance with the affidavit of Brett Oubre, Winnsboro’s

president and manager, generally disavowing having done business in Texas, and detailing the

nature of Winnsboro’s business. Santander responded by presenting the affidavit of Benny Cherry,

the Vice President–Dealer Operations for Santander (the Cherry Affidavit). The Cherry Affidavit

states, in pertinent part, that Santander’s corporate headquarters is in Dallas, Texas, and describes

the formation of the Agreement, the parties’ relationship under the Agreement, the procedures for

executing the Agreement, and Winnsboro’s solicitation and sale to Santander of 736 separate retail

installment contracts, including the Contract. Attached to the Cherry Affidavit was a copy of the

fully executed Agreement and a copy of the retail installment sales contract at issue in this case.

The trial court denied Winnsboro’s special appearance and ordered a new trial. This interlocutory

appeal followed. See TEX. CIV. PRAC. & REM. CODE ANN. § 51.014(a)(7) (West Supp. 2016).

STANDARD OF REVIEW

Whether a trial court has personal jurisdiction over a nonresident defendant is a question

of law. Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d 777, 790-91 (Tex. 2005).

Consequently, we review a trial court’s determination of a special appearance de novo. Moki Mac

River Expeditions v. Drugg, 221 S.W.3d 569, 574 (Tex. 2007). If, as is the case here,

the trial court does not issue findings of fact and conclusions of law with its special appearance

ruling, we imply all findings of fact necessary to support its ruling that are supported by the

evidence. BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789, 795 (Tex. 2002); Lewis v.

Indian Springs Land Corp., 175 S.W.3d 906, 913 (Tex. App.—Dallas 2005, no pet.). In this case,

the trial court impliedly found the Texas long-arm statute permits the exercise of jurisdiction over

Winnsboro, Winnsboro established purposeful “minimum contacts” with the forum state, and that

–3– the exercise of jurisdiction over Winnsboro comports with “traditional notions of fair play and

substantial justice.”

DISCUSSION

I. Personal Jurisdiction

In its first issue, Winnsboro argues it is not subject to personal jurisdiction in Texas. Texas

courts may exercise personal jurisdiction over a nonresident defendant “when the state’s long-arm

statute authorizes such jurisdiction and its exercise comports with due process.” Cornerstone

Healthcare Grp. Holding, Inc. v. Nautic Mgmt. VI, L.P., 493 S.W.3d 65, 70 (Tex. 2016). The

Texas long-arm statute allows jurisdiction over a nonresident that does business in Texas. TEX.

CIV. PRAC. & REM. CODE ANN. § 17.042 (West 2015). Among other acts, the Texas long-arm

statute provides that contracting with a “Texas resident,” where either party is to perform the

contract in whole or in part in Texas, constitutes “doing business” in this state. Id. (emphasis

added); Moki Mac, 221 S.W.3d at 574.

Winnsboro urges that because Santander is an Illinois Corporation it is not a Texas resident

entitled to utilize the long-arm statute to sue Winnsboro in Texas. While the long-arm statute gives

examples of actions that constitute doing business in the state, including contracting with a “Texas

resident” under stated circumstances, the statute does not define the term “Texas resident.”

Winnsboro does not cite any language in the statute or case law holding a corporation based in

Texas but incorporated under another state’s laws, such as Santander, cannot be a resident of

Texas.

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