Title: Mastercraft Floor Covering, Inc. v. Charlotte Flooring, Inc.

State: oklahoma

Issuer: Oklahoma Supreme Court

Document:

MASTERCRAFT FLOOR COVERING, INC. v. CHARLOTTE FLOORING, INC.2013 OK 87Case Number: 111529Decided: 10/22/2013THE SUPREME COURT OF THE STATE OF OKLAHOMA
NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN 
THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR 
WITHDRAWAL. 

MASTERCRAFT FLOOR COVERING, INC., 
Plaintiff/Appellant,v.CHARLOTTE FLOORING, INC., 
Defendant/Appellee.
CERTIORARI TO THE COURT OF CIVIL APPEALS DIVISION III
Honorable Jefferson D. Sellers, Trial Judge
¶0 The plaintiff/appellant, Mastercraft Floor Covering (Mastercraft), a 
Tulsa-based Oklahoma corporation, filed a lawsuit against Charlotte Flooring 
(CFI), a North Carolina corporation, on September 6, 2012, in the District Court 
of Tulsa County. Mastercraft alleged that CFI had hired it to install carpet in 
a North Carolina casino, but that after the work was completed, CFI failed to 
pay for the labor, services, and materials which totaled $140,976.23. CFI 
entered a special entry of appearance to object to Oklahoma having jurisdiction 
to decide the cause because CFI lacked the requisite minimum contacts to be sued 
in the State of Oklahoma. On February 6, 2013, the trial judge, determined that 
Mastercraft failed to prove that CFI had sufficient minimum contacts to permit 
Oklahoma to exercise jurisdiction over CFI without offending conventional 
notions of fair play and substantial justice. Mastercraft appealed, and the 
Court of Civil Appeals affirmed. We hold that because of the totality of 
contacts with the Oklahoma-based corporation, the trial court had personal 
jurisdiction. 
CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION 
VACATED;TRIAL COURT REVERSED AND CAUSE REMANDED.
Tadd J.P. Bogan, James E. Weger, Tulsa, Oklahoma, for 
Plaintiff/Appellant.Stephen K. Metcalf, William H. Spitler, Tulsa, Oklahoma, 
for Defendant/Appellee.
KAUGER, J:
¶1 The only issue presented is whether the trial court had personal 
jurisdiction over a North Carolina corporation who hired an Oklahoma company to 
perform work in North Carolina. Because of the totality of contacts with the 
Oklahoma-based corporation, we hold that it did. 
ALLEGED FACTS
¶2 Turner Construction, a construction company working on a Harrah's Cherokee 
Hotel Tower (Casino) in Cherokee, North Carolina, hired the defendant, appellee, 
Charlotte Flooring, Inc. (CFI) to perform flooring work on the Casino project. 
CFI is a North Carolina corporation, with its principal place of business in 
Charlotte, North Carolina. 
¶3 In May of 2010, CFI telephoned the plaintiff/appellant, Mastercraft Floor 
Covering, Inc. (Mastercraft), an Oklahoma corporation with its principal place 
of business in Tulsa, Oklahoma. According to Mastercraft, CFI telephoned to ask 
it to install carpet in the Casino. Subsequently, numerous telephone and email 
negotiations followed, culminating in a proposal dated May 25, 2010, prepared in 
Tulsa, Oklahoma, by Mastercraft and sent to CFI in North Carolina.1 In June of 2010, CFI sent 
Mastercraft a "Scope of Work for Commercial Installation" which was dated June 
25, 2010, and was signed and initialed by Mastercraft on July 13, 2010. 
¶4 Mastercraft sent workers from Oklahoma to Charlotte to install carpet in 
the Casino. The project was done in stages over a twenty month period. The owner 
of the project purchased the carpet directly from the materials manufacturer in 
Dalton, Georgia, and the owner furnished it to the project site for 
installation. Scheduling was done through emails between CFI and Mastercraft. 

¶5 An affidavit from Mastercraft's president provides that:
1) CFI made the initial contact with Mastercraft by telephone to Oklahoma, 
and Mastercraft executed the May 25, 2010, proposal letter from its office in 
Tulsa.2) The "Scope of Work" document was e-mailed from Charlotte to 
Oklahoma and Mastercraft signed it in Tulsa. 3) The contact between the two 
companies began in May of 2010, and lasted until March of 2012. 4) 
Mastercraft mailed invoices to Charlotte and CFI mailed 12 payments to Oklahoma 
for the work performed. 5) At least 30-40 phone calls and 140 emails were 
made regarding scheduling and a description of the work to be performed before 
CFI failed to pay the $140,976.23 balance it owed to 
Mastercraft.
¶6 Mastercraft submitted approximately 42 emails as a sampling of the 
correspondence which occurred between May of 2010 and March of 2012. The emails 
cover such topics as: start dates; communication problems; installations 
schedules; phone call follow ups; requests that phone calls be made; insurance; 
and construction delays. Other than its collaboration with Mastercraft, CFI 
insists it has no other contacts with Oklahoma. However, it does admit that it 
maintains a website, www.charlotteflooring.com, which is accessible to the 
general public and contains general information about its services. 
¶7 On September 6, 2012, Mastercraft filed a breach of contract action in the 
District Court of Tulsa County, alleging that CFI had failed to pay for services 
and materials provided pursuant to their contract. On October 26, 2012, CFI 
sought a special entry of appearance so that it could object to the Tulsa 
court's jurisdiction over it. The trial court granted the special entry of 
appearance on October 31, 2012. On November 19, 2012, CFI filed a motion to 
dismiss for lack of personal jurisdiction and supporting brief, arguing that any 
business relationship existing between Mastercraft and CFI involved insufficient 
contacts for the Oklahoma court to exercise personal jurisdiction. 
¶8 The trial court held a hearing on the motion to dismiss on January 28, 
2013. On February 6, 2013, the trial court entered a journal entry of judgment 
dismissing the case for lack of personal jurisdiction. Mastercraft appealed and 
in a May 17, 2013, unpublished opinion, the Court of Civil Appeals affirmed the 
trial court. We granted certiorari on September 23, 2013, to address whether an 
out-of-state company, who solicits business from and hires an Oklahoma company 
to perform work in another state, is subject to Oklahoma's jurisdiction.
¶9 BECAUSE OF THE TOTALITY OF THE CONTACTS WITH THE 
OKLAHOMA-BASED CORPORATION, THE TRIAL COURT HADPERSONAL 
JURISDICTION. 
¶10 Oklahoma's long-arm statute, 12 O.S. 2011 §2004(F), allows jurisdiction 
over non-residents in Oklahoma courts. It provides that "[a] court of this state 
may exercise jurisdiction on any basis consistent with the Constitution of this 
state and the Constitution of the United States."2 In Fields v. 
Volkswagen of America Inc., 1976 OK 106, 555 P.2d 48, 52, we explained that the intent of the 
Oklahoma long-arm statute is to extend the jurisdiction of Oklahoma courts over 
non-residents to the outer limits permitted by the Oklahoma Constitution3 and by the due process 
clause of the United States Constitution.4 
¶11 CFI argues that it has not directed its activities in any way toward 
Oklahoma, and that it would be unfair and substantially unjust to permit 
Mastercraft to bring this action in Oklahoma, merely because the Oklahoma 
contractor and its Oklahoma employees voluntarily accepted the benefits 
associated with voluntarily traveling to North Carolina to perform work on a 
North Carolina project. Mastercraft contends that pursuant to Hough v. 
Leonard, 1993 OK 
112, 867 P.2d 428, personal jurisdiction over CFI is proper.
¶12 When a non-resident deliberately engages in significant activities in a 
forum state or creates continuing obligations between the non-resident and the 
residents of the forum, the non-resident submits to the jurisdiction of the 
state.5 Jurisdiction may not be avoided merely because the 
non-resident did not physically enter the forum state. Jurisdiction under the 
long-arm statute is predicated on foreign state activity which results in forum 
state harm.6 A non-resident who has purposefully directed activities 
at forum residents must present a compelling case that jurisdiction would be 
unreasonable,7 or that the contacts were so insignificant that the 
exercise of in personam jurisdiction would offend the traditional notions of 
substantial justice and fair play.8 
¶13 When a nonresident corporation exercises the privilege of conducting 
activities in a state, it also enjoys the benefits and protections of the laws 
of that state and any obligations connected with that activity may be enforced 
in that state's courts.9 The focus is on whether there is some act by which the 
defendant purposefully avails itself of the privilege of conducting activities 
within the forum state, thus invoking the benefits and protections of its 
laws.10 Due process requires that the nonresident defendant's 
conduct and connection with the forum state are such that the nonresident could 
have reasonably anticipated being haled into court in that state.11 A single act can support jurisdiction so long as it 
creates a substantial connection with the forum state.12 For purposes of due process, jurisdiction is proper if 
the suit was based on a contract that has substantial connection with the 
state.13
¶14 Twenty years ago, in Hough v. Leonard, 1993 OK 112, 867 P.2d 428, we addressed whether a 
non-resident engaged in the oil and gas business had sufficient contacts with 
Oklahoma for an Oklahoma court to assert personal jurisdiction. In Hough, 
an Oklahoma resident who owned and operated an oil field service company was 
hired by a non-resident oil business to work on an oil well in Kansas. When 
problems with the Kansas oil well were unresolved, the non-resident oil company 
telephoned the Oklahoma resident to ask for rates to do more work on the well. 
The Oklahoma resident faxed quotes out of state to the non-resident and was 
hired to work on the Kansas well. The only other connection that the 
non-resident had with the state was that one of his business partners held a 
recorded mineral leasehold interest in Oklahoma.
¶15 When Hough brought suit against the non-residents in Oklahoma to recover 
for payment of his services, the Court held that, based on the totality of the 
contacts, the non-residents contact with Oklahoma was sufficient to exercise 
personal jurisdiction over the non-residents. We said:
Here, the non-residents have made the necessary minimum contacts with 
Oklahoma. After exhausting Kansas firms, the non-residents hired an Oklahoma 
company, in which Hough was a subcontractor, to work on the well. Although it is 
disputed whether the non-residents called Hough for the purpose of obtaining 
advice, quotations, and services on the Kansas well, the jury returned a verdict 
in Hough's favor. It is not disputed that a contract was entered into over the 
telephone in Oklahoma. Regardless of who initiated the contact, the 
non-residents could have refused to enter into a contract and thereby alleviated 
the risk of defending a suit commenced in Oklahoma. McMillan also has recorded 
leasehold interests in Oklahoma and relies on Oklahoma law to protect his 
interest in those leases. Finally, after dealing with Hough, the non-residents 
contacted at least two more Oklahoma companies to inquire about providing 
services on the Kansas well. While each individual contact made by the 
non-residents may not be sufficient standing alone to maintaining minimum 
contacts, the totality of the contacts are sufficient to exercise personal 
jurisdiction over the non-residents.14 
¶16 Here, there is no leasehold interest involved. Nevertheless, CFI elected 
to do business with Mastercraft, an Oklahoma company. The interaction between 
the Oklahoma company and the North Carolina company was not a single isolated 
transaction which involved the unilateral activity of Mastercraft.15 CFI chose to engage in activities with an Oklahoma 
corporation. Between May of 2010, and March of 2012, over 30-40 phone calls and 
140 emails were exchanged. Communications were further maintained by mailing 
checks for services performed to the Oklahoma company. 
¶17 Although CFI disputes the existence of a contract, this argument is 
meritless. The undisputed facts show that the Oklahoma company was asked to 
perform work in North Carolina, and that it received at least partial payment 
for the work performed. At the very least an oral contract was formed. CFI's 
voluntary election to do business with an Oklahoma company, and the stream of 
communications it maintained with that Oklahoma company constitute an effort by 
CFI to avail itself of the privilege of conducting activities in Oklahoma. Even 
more so than the facts demonstrated in Hough, supra, CFI's election to do 
business with an Oklahoma entity and its electronic and postal communications 
within Oklahoma constitute minimum contacts with this state. The alleged 
controversy arose out of, or was related to, these contacts. CFI's demonstration 
of its willingness and ability to conduct business with an Oklahoma corporation 
also demonstrates that the burden placed on CFI in defending itself in our 
courts would not rise to a level of constitutional concern.
¶18 Other Oklahoma precedent supports the conclusion that the out-of-state 
corporation has made the necessary minimum contacts with Oklahoma. For example, 
in Conoco Inc., v. Agrico Chemical Co., 
2004 OK 83, ¶21, 115 P3d 829, an 
Oklahoma company negotiated and executed a purchase agreement in Oklahoma and we 
noted that the ties to Oklahoma far exceeded the minimum contacts requirement. 
In Gregory v. Grove, 1976 OK 5, ¶6, 547 P.2d 381, 382, we held that a totality of contacts 
between non-resident defendants and Oklahoma are to be considered in determining 
the sufficiency to exercise jurisdiction under long-arm service -- and that this 
may include telephone communications and letters. 
¶19 In B.K. Sweeney Co. v. Colorado 
Interstate Gas Co., 1967 OK 95, ¶¶12-15, 429 P.2d 759, we recognized: that the absence of 
multiple acts within the state is not necessarily fatal to the exercise of state 
power over a defendant; that a non-resident who engages in a single act or 
consummates a single transaction in a foreign state could be amendable to suit 
for damages arising out of that transaction; and that there exists no 
constitutional barrier to holding a non-resident subject to personal 
jurisdiction, irrespective of whether additional contacts in the state exist. In 
Yankee Metal Prod. Co. v. District 
Court, 1974 OK 
135, ¶10, 528 P.2d 311, the Court found personal jurisdiction over a non-resident whose only 
contact with Oklahoma was through telephone and mail communications. The 
non-resident made initial contact with Oklahoma by telephone to request a 
quotation on specifications of materials. All of these cases support the 
conclusion that minimum contacts were more than sufficient under the facts 
alleged in this cause.
CONCLUSION
¶20 In this instance, minimum contacts have been established and form the 
basis of Mastercraft's claim. Although the work was done in North Carolina, the 
contract appears to be executed in Oklahoma, and even if it were not, CFI's 
business activities were directed to Oklahoma and are the very activities that 
gave rise to this claim. While CFI may be burdened by having to come to Oklahoma 
to defend this matter, it chose to do business here. This state has a clear 
interest in helping its citizens obtain convenient and efficient resolution of 
controversies arising from contacts in this state. North Carolina's interest in 
this controversy is no greater than Oklahoma's. The trial court has personal 
jurisdiction over CFI.16 
CERTIORARI PREVIOUSLY GRANTED;COURT OF CIVIL APPEALS OPINION 
VACATED;TRIAL COURT REVERSED AND CAUSE REMANDED.
COLBERT, C.J., REIF, V.C.J., KAUGER, WATT, EDMONDSON, COMBS, GURICH, JJ., 
concur.
WINCHESTER, TAYLOR, JJ., dissent.
FOOTNOTES
1 The letter dated May 25, 
2010, is on Mastercraft letterhead and it is titled, "Proposal for Harrah's 
Cherokee Casino." It calls for the installation of 13,650 yards of carpet, 
customized seaming and border transitions, installation of pad, and 
specifications for seams. It also includes services of 24 hour a day owner and 
supervisor availability, clean up and vacuuming as well as crew travel and 
lodging. The yardage was based on Turner Construction blue prints dated March 
16, 2010, and provided as part of a bid set. The total listed on the leter was 
$242,373.00, and it was signed by Gary Freeby of Mastercraft. 
2 This statute has been amended several times. A portion 
of one amendment was held unconstitutional by Douglas v. Cox 
Retirement Properties, Inc., 2013 OK 37, 302 P.2d 789, and later re-enacted. 
However the pertinent provision remains unchanged. 
3 The Okla. Const. art. 2, §2 provides:
All persons have the inherent right to life, liberty, the pursuit of 
happiness, and the enjoyment of the gains of their own industry. 
4 The U.S. Const. amend. 14, §1 provides in pertinent 
part:
...No state shall make or enforce any law which shall abridge the privileges 
or immunities of citizens of the United States; nor shall any State deprive any 
person of life, liberty, or deny to any person within its jurisdiction the equal 
protection of the laws. 
5 Hough v. Leonard, 1993 OK 112, ¶7, 867 P.2d 438. See also, Burnham v. 
Superior Court of California, 495 U.S. 604, 
609-10, 110 S. Ct. 2105, 2109-10, 109 L. Ed. 2d 631, 638-39 (1990) (California 
court had personal jurisdiction in divorce action over New Jersey resident who 
was served with process while temporarily in California for activities unrelated 
to suit; due process was not violated by exercise of the jurisdiction. Due 
process does not necessarily require states to adhere to unbending territorial 
limits on jurisdiction.); Burger King Corp. v. 
Rudzewicz, 471 U.S. 462, 475-77, 105 S. Ct. 2174, 2184-85, 85 L. Ed. 2d 528, 543-44 (1985). The unilateral activity of the resident is not 
enough to exercise personal jurisdiction over a non-resident. Hansen v. 
Denckla, 357 U.S. 235, 253, 78 S. Ct. 1228, 1239, 2 L. Ed. 2d 1283, 
1298 (1958); Architectural Bldg. Components Corp. v. 
Comfort, 1974 OK 
134, ¶14, 528 P.2d 307. Foreseeability of causing an injury to another state alone is not 
sufficient to establish jurisdiction. The foreseeability that is critical to due 
process analysis is that the defendant's conduct and connection with the forum 
state is such that the person should reasonably anticipate being hailed into 
court there. World-Wide Volkswagen Corp. v. Woodson, 
444 U.S. 286, 296-97, 100 S. Ct. 559, 566-67, 62 L. Ed. 2d 490, 501 (1980). However, a 
state generally has a manifest interest in providing its residents with a 
convenient forum for redressing injuries inflicted by out-of-state actors. So 
long as it creates a substantial connection with the forum, even a single act 
can support jurisdiction. McGee v. International Life 
Ins. Co., 355 U.S. 220, 223, 78 S. Ct. 199, 201, 2 L. Ed. 2d 223, 
226 (1957). 
6 Hough v. Leonard, see note 5, supra; 
Fields v. Volkswagon of America, Inc., 
1976 OK 106, ¶6, 555 P.2d 48. 
7 Hough v. Leonard, see note 5, supra; 
Burger King Corp. v. Rudzewicz, see note 5, supra. 

8 Hough v. Leonard, see note 5, supra; 
International Shoe Co. v. Washington, 
326 U.S. 310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95, 102, 161 A.L.R. 1057, 1061 (1945); 
Yery v. Yery, 1981 OK 46, ¶10, 629 P.2d 35. See also, 
Shaffer v. Heitner, 433 U.S. 186, 206-07, 97 S. Ct. 2569, 
2581, 53 L. Ed. 2d 683, 699 (1977) (All assertions of state jurisdiction, 
including in rem and quasi-in rem actions must be evaluated according to the 
minimum contacts standard.). 
9 Conoco Inc., v. Agrico Chemical 
Company, 2004 OK 
83, ¶19, 115 P.3d 829; International Shoe Co. v. Washington, see 
note 8, supra at 326 U.S. 319, 66 S. Ct. 160. 
10 Conoco Inc., v. Agrico Chemical 
Company, see note 9, supra; Hansen v. Denckla, see note 5, 
supra. 
11 Conoco Inc., v. Agrico Chemical 
Company, see note 9, supra; World-Wide Volkswagen 
Corp. v. Woodson, see note 5, supra. 
12 Conoco Inc., v. Agrico Chemical 
Company,, see note 9, supra; McGee v. International 
Life Ins. Co., see note 5, supra. 
13 Conoco Inc., v. Agrico Chemical 
Company; McGee v. International Life Ins. 
Co., see note 5, supra. 
14 Hough v. Leonard, see note 5, supra at 
¶13. 
15 Anderson v. Shiflett, 435 F.2d 1036, 
1038 (10th Cir. 1971) wherein a Texas resident hired an 
Oklahoma architect to draw plans for a project. The contract was made in Texas 
and covered projects located in Texas. The only Oklahoma contact was that the 
architect drew some of the plans at his Oklahoma office. Oklahoma lacked 
jurisdiction over the service contract because it was a single isolated 
transaction which involved the unilateral activity of the Oklahoman. Nor is it a 
case in which a party has failed to allege enough facts to assert jurisdiction. 
See, Crescent Corp. V. Martin, 1968 OK 95, ¶27, 443 P.2d 111, wherein an Oklahoma resident entered into 
an employment contract for consulting services with a corporation not licensed 
or doing business in Oklahoma. Oklahoma did not have jurisdiction because the 
facts alleged in the record were insufficient to sustain jurisdiction. The 
record was silent as to where the contract of employment was made, accepted, or 
to be performed. The Crescent Court refused to infer facts that a party failed 
to allege in order to assert jurisdiction. Even if these cases were persuasive 
at the time they were decided, the law and the way in which companies do 
business have evolved considerably in the last 40 years. 
16 Hough v. Leonard, see note 5, supra; 
Conoco Inc., v. Agrico Chemical Co., see note 
9, supra; Gregory v. Grove, 1976 OK 5, ¶6, 547 P.2d 381; Yankee Metal Prod. 
Co. v. District Court, 1974 OK 135, ¶10, 528 P.2d 311; and B.K. Sweeney 
Co. v. Colorado Interstate Gas Co., 
1967 OK 95, ¶¶12-15, 
429 P.2d 759.