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Personal Jurisdiction Lessons Learned . . . Forgotten . . . and Remembered

As lawyers, we learn early on about the necessity that a court must have personal jurisdiction over a defendant in order to enter a valid, enforceable judgment.  Recently, the Tennessee Court of Appeals, in Corporate Flight Management, Inc. v. Tal Aviation, S.A., Case No. M2018-01492-COA-R3-CV (8/28/19), had occasion to provide a basic primer on personal jurisdiction.

In sum, the appellate court affirmed the trial court’s dismissal of the action for lack of personal jurisdiction.  It rejected the Tennessee aircraft charter’s attempts to sue a French citizen in Murfreesboro, Tennessee for unpaid charter services.  The private charter services had been booked by a Luxembourg company, allegedly an agent acting in Tennessee whose actions were arguably to be imputed to the French citizen defendant.  The trial court rejected the agency arguments.  Lessons learned, forgotten, and remembered:

1. The authority of courts to exercise jurisdiction over non-resident persons is limited by the Due Process Clause of the 14th Amendment, which is co-extensive with Tennessee constitutional protections of due process.

2. The Tennessee “long-arm” jurisdictional statute is to be construed to extend jurisdiction of Tennessee Courts “as far as constitutionally permissible.”  Tenn. Code Ann. § 20-2-214.

3. There are two types of personal jurisdiction –

(a) specific – when a person has constitutionally required “minimum contacts” with the forum state and the claim arises out of those contacts.

(b) general – unrelated to the contacts giving rise to the suit but based on person’s pervasive, systematic, meaningful contacts with the forum state.

4. Jurisdiction may be challenged by a Rule 12 motion to dismiss.  The motion may be supported by affidavits, but the trial court is not “obligated to accept as true factual allegations . . . that are controverted by more reliable evidence and plainly lack credibility.”

5. Whether plaintiff establishes a prima facie showing of personal jurisdiction over a defendant is a question of law.

6. A defendant is not entitled to a jury trial on whether the facts establish personal jurisdiction.

7. Ordinarily, personal jurisdiction is a threshold issue to be decided early on to produce savings of time and resources.

The trial court properly considered the contracts between the Luxembourg broker and the French citizen defendant, and properly rejected the plaintiff’s perceptions of the alleged agent’s actions.  One more lesson remembered:  “An agent’s authority must be traceable to the principal and may not be shown by his (the agent’s) own statements or merely proving that he claimed or undertook to act as an agent.”