Case Name: AETNA LIFE & CASUALTY COMPANY, as subrogee of Energy Conservation, Unlimited, Inc., Appellant, v. THERM-O-DISC, INC., Appellee
Court: Florida District Court of Appeal
Jurisdiction: Florida
Decision Date: 1986-02-12
Citations: 488 So. 2d 83
Docket Number: No. BG-422
Parties: AETNA LIFE & CASUALTY COMPANY, as subrogee of Energy Conservation, Unlimited, Inc., Appellant, v. THERM-O-DISC, INC., Appellee.
Judges: BOOTH, C.J., and WIGGINTON, J., concur.
Reporter: Southern Reporter, Second Series
Volume: 488
Pages: 83–91

Head Matter:
AETNA LIFE & CASUALTY COMPANY, as subrogee of Energy Conservation, Unlimited, Inc., Appellant, v. THERM-O-DISC, INC., Appellee.
No. BG-422.
District Court of Appeal of Florida, First District.
Feb. 12, 1986.
Rehearing Denied May 19, 1986.
Harris Brown, of Mathews, Osborne, McNatt, Gobelman & Cobb, Jacksonville, for appellant.
Daniel C. Shaughnessy, of Coker, Myers & Schickel, Jacksonville, for appellee.

Opinion:
BARFIELD, Judge.
Aetna Life and Casualty Company (Aet-na) appeals an order granting appellee's motion to dismiss for lack of jurisdiction. Appellant asserts that the trial court erred in concluding that "there are insufficient allegations to bring Defendant within the provisions of Section 48.193, Florida Statutes." We agree and reverse.
Aetna is the liability insurer for Energy Conservation Unlimited (ECU), which manufactures a device that transfers heat from air conditioning units to hot water heaters. Although this mechanism is not activated in the winter, it remains filled with water and requires protection from freezing. Ap-pellee Therm-O-Disc manufactures a switch which is intended to activate a circulating pump when the temperature reaches freezing, to prevent damage to the heat transfer unit.
ECU, a Florida corporation, purchased switches from Therm-O-Disc, a foreign corporation with its principal place of business in Ohio. The switches were shipped to ECU's office in Florida and incorporated by ECU into the heat transfer units, which were then distributed to various consumers, including the U.S. Government for use at base housing projects in Georgia and South Carolina. During the winter of 1981-82, the switches failed to activate the circulating pumps, resulting in substantial property damage in Georgia and South Carolina, for which Aetna reimbursed the U.S. Government and thereby became subrogat-ed to ECU's rights against Therm-O-Disc.
Aetna subsequently sued Therm-O-Disc in five separate counts alleging negligence, breach of express warranty, breach of implied warranty of merchantability, breach of implied warranty of fitness for a particular purpose, and strict liability. Therm-O-Disc moved to dismiss for lack of jurisdiction and the original complaint was dismissed with leave to amend. Aetna's amended complaint alleged that Therm-O-Disc sold and delivered switches to ECU in Florida, that Therm-O-Disc engaged in a business activity or venture in Florida by negotiating and completing this sale within the state, that Therm-O-Disc breached the contract and breached express and implied warranties in Florida due to the failure of its product to conform to its intended use, that Therm-O-Disc was engaged in solicitation of the sale of switches to ECU in Florida, and that the switches were processed, serviced or manufactured by Therm-O-Disc, were used or consumed within Florida in the ordinary course of commerce, trade, or use, and said use resulted in damages to ECU.
Therm-O-Disc moved a second time to dismiss for lack of jurisdiction and filed a supporting affidavit of its product safety director which stated that Therm-O-Disc has no business office, no property, and no agent or representative in Florida, that the switches were custom-made pursuant to specifications received from ECU, that Therm-O-Disc does not offer its products for sale to the general public in Florida and did not engage in solicitation of the sale of the custom-made switches, and that Therm-O-Disc did not maintain any degree of direction or control over the switches once they had been delivered to ECU. In response, Aetna filed two affidavits, from the vice-president of ECU and from ECU's purchasing manager. The vice-president's affidavit stated that the sale and delivery of the switches from Therm-O-Disc were completed in Florida and that the switches were incorporated into the heat transfer units in Florida. The purchasing manager's affidavit stated that Therm-O-Disc's products are used by other manufacturers in Florida, that the switches are a standard type, calibrated to fit the specific needs of the customer, and that she had numerous telephone conversations with Therm-O-Disc, which provided input as to the technical requirements for the switches. The affidavit further stated that Therm-O-Disc entered into a contract for the delivery of its switches to ECU in Longwood, Florida, that the switches were delivered pursuant to this contract in Florida, and that the contract was breached in Florida in that the switches did not comply with their intended use. The affidavit also stated that Therm-O-Disc's district manager personally made a sales call to the office of ECU in Long-wood, Florida, soliciting the business of ECU. Attached to this affidavit were invoices manifesting the existence of a contract between the parties.
In its order granting the motion to dismiss for lack of jurisdiction, the trial court concluded that there were insufficient allegations to bring the defendant within the provisions of the long-arm statute and the cases interpreting that statute. Noting that it was not clear from the purchasing manager's affidavit whether Therm-O-Disc's district manager visited ECU in connection with the contract described in the amended complaint, the court gave Aetna fifteen days within which to file a further affidavit. Instead, Aetna filed this appeal.
Section 48.193, Florida Statutes (1981), lists the acts which will subject a person to the jurisdiction of the courts of this state for any cause of action arising from the specified acts. The procedure to be followed in testing jurisdiction under the long-arm statute is as follows: The plaintiff must initially allege in its complaint sufficient jurisdictional facts to show compliance with the statute, at which time the burden shifts to the defendant to make a prima facie showing of the inapplicability of the statute, and thereafter plaintiff is required to substantiate its jurisdictional allegations. Pace Carpet Mills, Inc. v. Life Carpet and Tile Company, Inc., 365 So.2d 445 (Fla. 4th DCA 1978). If the plaintiff's allegations in support of jurisdiction are challenged, and that challenge is supported by affidavit, plaintiff must then support its jurisdictional allegations by affidavit or oth'er proof. Sims v. Sutton, 451 So.2d 931 (Fla. 3d DCA 1984); Newton v. Bryan, 433 So.2d 577 (Fla. 5th DCA 1983); Hickok Teaching Systems, Inc. v. Equitech Training Systems, Inc., 421 So.2d 772 (Fla. 4th DCA 1982); and Cosmopolitan Health Spa, Inc. v. Health Industries, Inc., 362 So.2d 367 (Fla. 4th DCA 1978).
Before a state court may acquire personal jurisdiction over a foreign corporation, the foreign corporation must have initiated some minimum contact with the forum state, so that maintenance of the suit does not offend traditional notions of fair play and substantial justice. Harlo Products Corporation v. J.I. Case Company, 360 So.2d 1328 (Fla. 1st DCA 1978). It is necessary that there be some act by which the foreign corporation purposely avails itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protection of its laws. Id. at 1329. Long arm statutes are to be strictly construed, in order to guarantee compliance with due process requirements. Citizens State Bank v. Winters Government Securities Corporation, 361 So.2d 760 (Fla. 4th DCA 1978); Bank of Wessington v. Winters Government Securities Corporation, 361 So.2d 757 (Fla. 4th DCA 1978).
Aetna's amended complaint indicates that appellant sought to establish jurisdiction under subsections (l)(a) (engages in a business venture in the state), (l)(f) (causes injury to persons or property within the state), and (l)(g) (breaches a contract in the state). The allegations that Therm-O-Disc is engaged in a business venture in this state appear to be insufficient to establish in personam jurisdiction, so that jurisdiction has not been established under subsection (l)(a). Jurisdiction has also not been established under subsection (l)(f), which applies where physical injury has occurred to persons or property within the state, not, as here, where physical injury to property outside the state has resulted in financial injury to a Florida corporation or its subrogee. Hyco Manufacturing Company v. Rotex Industrial Corporation, 355 So.2d 471 (Fla. 3d DCA 1978). However, Aetna has sufficiently pled jurisdictional facts showing that Therm-O-Disc's conduct falls within section 48.193(l)(g), which provides that a person who "[bjreaches a contract in this state by failing to perform acts required by the contract to be performed in this state" subjects himself "to the jurisdiction of the courts of this state for any cause of action arising from [the breach]." Aetna has asserted that Therm-O-Disc contracted to deliver switches to ECU in Florida, that these switches, when delivered, did not conform to the specifications and requirements agreed upon, and that the breach of the contract therefore occurred within the State of Florida, upon the delivery of the non-conforming goods. Thermo-Disc's affidavit in support of its motion to dismiss does not appear to refute any of these allegations.
Appellee asserts nonetheless that the invoices attached to appellant's affidavit conclusively show that the legal place of delivery, wherein ECU took beneficial ownership and legal title to the switches, was Mansfield, Ohio, since the invoices recited the goods were shipped to ECU, "F.O.B. Mansfield." Alternatively, appellee argues that no acts required to be performed by it in Florida were not performed, since both parties had intended that the contract between them was for switches which were ultimately to be used in Georgia and South Carolina, and that it was only after the switches were installed in Georgia and South Carolina that they allegedly failed to perform their function and caused property damage in those states. As to the latter argument, appellee appears to have confused the point at which the contract was breached (by delivery of goods which did not conform to the agreement between the parties) and the point at which this breach became known (when the switches failed).
However, as to appellee's first argument, once appellant had sufficiently pled jurisdictional facts showing that appel-lee breached the contract in Florida by delivering in Florida switches that did not conform to the contractual specifications, and appellee's affidavit did not refute these allegations, appellant was under no duty to further support its allegations by affidavit or other proof. Nevertheless, appellant did submit such proof, in the form of two affidavits and two invoices. The affidavits stated, inter alia, that both the delivery and the breach occurred in Florida, but the invoices indicate that the switches were to be shipped F.O.B. appellee's plant in Ohio. This seems to indicate that delivery, and therefore the breach of contract, occurred in Ohio. If appellee had stated in its affi davit that delivery did not take place in Florida, the invoices would appear to support that position, so that appellant would then have been required to prove, if it could, that in fact delivery did occur in Florida, so as to support its allegations to that effect. The record before us does not indicate whether this issue was addressed by the parties and the court below.
Because the record contains the invoices which appear to contradict appellant's affidavits, we cannot conclusively determine that delivery of the switches took place in Florida. But because appellee did not state in its affidavit, nor argue in its motion to dismiss, that delivery of the switches did not take place in Florida, we are not in a position to make a determination that delivery did not take place in Florida. That determination is for the trial court on remand.
There remains the question of whether Aetna has met the "minimum contacts" test of International Shoe Company v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945). In Lacy v. Force V Corporation, 403 So.2d 1050, 1054 (Fla. 1st DCA 1981), this court held that in determining whether the minimum contacts test had been met,
Unquestionably, the single most important factor to be considered is whether "the defendant's conduct and connection with the forum . are such that he should reasonably anticipate being haled into court there..." It is essential that this circumstance be considered from the perspective of the defendant — not from that of the plaintiff. The reasonable foreseeability factor is frequently applied to force a nonresident defendant to answer a suit within the forum if it "purposefully avails itself of the privilege of conducting activities within the forum. ."
(cites omitted). In Lacy, the allegations in the complaint grounded jurisdiction on section 48.193(l)(g), based upon delivery to a Florida corporation of a printing press which did not conform to the specifications in the contract. The Ohio manufacturer's affidavits stated that it had no business connection in Florida, except an unsolicited phone call by the plaintiff regarding the machinery, in which information concerning specifications and shipping arrangements were sought. The Lacy court employed the dual test of Products Promotions, Inc. v. Cousteau, 495 F.2d 483 (5th Cir.1974), in determining that Florida could assume jurisdiction under the circumstances without depriving the defendant of due process. The court found that the defendant had not rebutted the assertions in plaintiff's complaint that the contract was to be performed in Florida, that the press was in fact delivered to plaintiff's place of business in Florida, and that the contract was there breached due to defendant's failure to. provide equipment complying with the contractual specifications. The court held that because the contract was required to be performed in Florida, it was not unreasonable from the defendant's perspective to foresee that an alleged breach of the contract might be litigated in Florida, or that enforcement of the defendant's rights under the contract might depend on the laws of Florida. The court noted that defendant's delivery of the printing press to the plaintiff could hardly be deemed a fortuitous, nondeliberate act, since "he purposefully employed the normal channels of commerce as a conduit to market his product in another state." 403 So.2d at 1056.
The Lacy court considered that the legislature, through its enactment of section 48.193, has expressed an important policy consideration that Florida residents whose contracts are to be performed in this state shall be protected here from any po tential breach of their contracts by out-of-state persons. It held that the defendant's "conduct in connection with the forum is such that he should reasonably anticipate being brought in court to defend any alleged breach of the contract." Id. Following Lacy, we hold that if the trial court determines on remand that the delivery of the switches, and therefore any breach of the contract regarding the switches, took place in Florida, sufficient minimum contacts between Therm-O-Disc and the State of Florida will have been shown to satisfy the due process requirements of International Shoe.
The trial court's order granting the motion to dismiss for lack of jurisdiction is REVERSED and the cause is REMANDED to the trial court for an evidentiary hearing, if necessary, and a determination of the place at which the allegedly nonconforming goods were in fact delivered, so as to determine the location of the contract breach, upon which in personam jurisdiction over appellee appears to rest.
BOOTH, C.J., and WIGGINTON, J., concur.
. See Jones v. Jack Maxton Chevrolet, Inc., 484 So.2d 43 (Fla. 1st DCA 1986), in which this court held that it is sufficient to plead jurisdiction over non-resident defendants by tracking the relevant language of the long arm statute.
. In Canron Corporation v. Holt, 444 So.2d 529 (Fla. 1st DCA 1984), the court appears to have determined that, notwithstanding the fact that Canron's product was shipped F.O.B. its South Carolina plant, the product was delivered in Florida. The court held that this demonstrated sufficient "connexity" between Canron's business activities in Florida and the cause of action sued upon. It should be noted, however, that the finding of personal jurisdiction in Canron was based on section 48.193(l)(a) ("doing business" in Florida), and that the record indicates a continuous course of dealing between Canron and the Florida corporation over many years.
. This disposition is not meant to prejudice appellant's right to seek permission from the trial court to amend its complaint to properly allege in personam jurisdiction under any of the other sections of the long arm statute. If the complaint is so amended, and the jurisdictional allegations are properly challenged, appellant will then be required to prove its allegations.