Case Name: UNION SKI COMPANY, Plaintiff and Appellant, v. UNION PLASTICS CORPORATION, Defendant and Respondent
Court: Utah Supreme Court
Jurisdiction: Utah
Decision Date: 1976-03-31
Citations: 548 P.2d 1257
Docket Number: No. 14065
Parties: UNION SKI COMPANY, Plaintiff and Appellant, v. UNION PLASTICS CORPORATION, Defendant and Respondent.
Judges: HENRIOD, C. J., and ELLETT and TUCKETT, JJ., concur.
Reporter: Pacific Reporter 2d
Volume: 548
Pages: 1257–1264

Head Matter:
UNION SKI COMPANY, Plaintiff and Appellant, v. UNION PLASTICS CORPORATION, Defendant and Respondent.
No. 14065.
Supreme Court of Utah.
March 31, 1976.
J. Brent Wood, Provo, Dave McMullin, Payson, for plaintiff and appellant.
Douglas J. Perry, Salt Lake City, for defendant and respondent.

Opinion:
CROCKETT, Justice:
Plaintiff, Union Ski Company, a Utah corporation, brought this action against defendant, Union Plastics Corporation, a California corporation, to recover for damages allegedly suffered because of defendant's breach of contract relating to a plan for defendant to manufacture ski boots. Defendant was served as provided in section 78-27-25, U.C.A.1953, the so-called Long-Arm Statute. From the granting of de fendant's motion to dismiss for lack of jurisdiction over it, the plaintiff appeals.
In the fall of 1973, Brent C. Hall, a Utah resident, visited the Union Plastics (Plastics) plant in California to discuss the feasibility of having Plastics manufacture a ski boot for Miller Ski Company, which then employed Mr. Hall. In November, 1973, Miller abandoned the project. However, Plastics had indicated some interest in the plan, so Mr. Hall and Arben K. Jol-ley, also a Utah resident, formed a new Utah corporation, Sports Industries, Inc., to market the boots which Plastics would manufacture. The name was later changed to Union Ski Company.
Negotiations between the two firms began in November, 1973, and, on December 28, 1973, Arthur Eizenberg, general manager of Plastics, came to Utah. The trip was primarily a ski vacation for Mr. Ei-zenberg and his family, but he did bring a proposed contract, which proved unacceptable to Ski. Mr. Eizenberg returned to Utah on January 5, 1974, when he met with Ski. An oral understanding was arrived at, which was to be completed in typewritten form, and then executed by the parties, which was not then accomplished. After some changes, the contract in controversy here was signed in April, 1974, by Plastics in California.
For Utah to acquire jurisdiction over the defendant, it would have to be on the basis of our statute, Section 78-27-24, U.C.A. 1953, which provides:
Any person . . . who in person or through an agent does any of the following enumerated acts, submits himself, . . . to the jurisdiction of the courts of this state as to any claim arising from:
(1) The transaction of any business within this state;
(2) Contracting to supply services or goods in this state; . . .
It is the prerogative of this State to set its own standards as to what contacts or activities within the State are sufficient to meet the requirements of that statute, so long as they do not fall below the requirements under adjudications based upon provisions of the Constitution of the United States, cited and relied upon by plaintiff. Notwithstanding the asserted trend toward liberality in allowing the acquisition of jurisdiction, with which this court is generally in agreement, it is significant to note that in Hanson v. Denckla decided subsequent to those cases, the United States Supreme Court warned against too extended an application of those decisions:
But it is a mistake to assume that this trend heralds the eventual demise of all restrictions on the personal jurisdiction of state courts, [citation] Those restrictions are more than a guarantee of immunity from inconvenient or distant litigation. They are a consequence of territorial limitations on the power of the respective States. However minimal the burden of defending in a foreign tribunal, a defendant may not be called upon to do so unless he has had the "minimal contacts" with that State that are a prerequisite to its exercise of power over him. [citations]
. . . [I]t is essential is each case that there be 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, [citation]
It is undoubtedly true that effect should be given to the policy declaration in our statute, that the jurisdiction of our courts should be extended to protect the citizens of this State consistent with concepts of fairness and equal justice under due process of law. But the other side of this coin is that the rule of. law should also protect our citizens from suits in other states, unless they have engaged in some conduct or activity there beyond a mere casual or transitory presence therein; and concomitantly, that the residents of our sister states should be given the same protections here as we expect our citizens to be accorded there.
In harmony with the foregoing this court has consistently held that the transaction of business within the meaning of our statute requires that the defendant has engaged in some substantial activity with some degree of continuity within this State. In the case of Hill v. Zale Corp. we set forth a number of examples of activity to be examined in determining whether, by reason of any one of them, or any combination of them, it can fairly and reasonably be said that activities of the foreign corporation in this State should subject it to the jurisdiction of our courts.
In analyzing whether the plaintiff has shown that the defendant comes within that requirement, these propositions are to be considered: First, the burden was upon the plaintiff to affirmatively so demonstrate. Second, on appeal we indulge the presumption of verity and correctness of the trial court's determination and do not disturb it unless the plaintiff has shown that it was in error. Third, there is a further principle, recognized in this area of the law, which may be regarded as having some bearing on the trial court's determination here. That is, that it is generally thought to be more fair and logical to find jurisdiction in the forum state when the major aspects of the activity out of which the cause of action arises occurs in that state; and conversely, that determination of jurisdiction in the forum state is less likely to be found where the principal activities (the execution of the contract, manufacture of the boots, and the payments therefor and defendant's alleged breach of the contract) take place elsewhere.
The main activity of the defendant relied upon by the plaintiff is that of Mr. Eizenberg. He visited Utah a total of four times: the two occasions previously mentioned, and again on January 11, 1974, and April 5, 1974. On the latter visits, Mr. Eizenberg attended meetings about the planning of sales after the boots should be manufactured, and he also inspected Ski's operations. Defendant Plastics did pay for some work done by three employees selected and retained by Ski. But Plastics did not have any business situs by way of office or store or otherwise in the State, nor any property, inventory, telephone listing or bank account; nor do any advertising here. Further, the contract on which plaintiff relies was executed in defendant's behalf in California; it provided that all payments would be made to Plastics' bank there, that all shipments would be F.O.B. Plastics' California plant, where the shoes were to be manufactured; and that the laws of California would govern the agreement.
When the foregoing facts are considered in the light of the principles above discussed and as set forth in the cited cases, we are not persuaded that we should disagree with the determination made by the trial court: that it was not shown that the defendant had engaged in activities in this State sufficient to render it subject to the jurisdiction of our courts.
Affirmed. No costs awarded.
HENRIOD, C. J., and ELLETT and TUCKETT, JJ., concur.
. McGee v. International Life Insurance Co., 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957) ; International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945).
. 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958).
. Id. at pp. 251, 253, 78 S.Ct. at pp. 1238, 1240.
. See See. 78-27-22, U.C.A.1953.
. Mack Financial Corp. v. Nevada Motor Rentals Inc., 529 P.2d 429 (Utah) ; Hanks v. Administrator of Estate of Jensen, 531 P.2d 363 (Utah 1975) ; Transwestern General Agency v. Morgan, 526 P.2d 1186 (Utah 1974) ; Pellegrini v. Sachs & Sons, 522 P.2d 704 (Utah 1974).
. 25 Utah 2d 357, 482 P.2d 332.
. Moore, Federal Practice, Sec. 4.25 (2d Ed. 1967), and authorities therein cited.