Court Opinion

ID: 2689300
Source: CourtListenerOpinion
Date Created: 2014-08-01 17:00:35.097618+00
Date Added: 2024-06-11T09:50:13.035796
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                             FOURTH DISTRICT
                              July Term 2014

                          JEREMY HAMILTON,
                              Appellant,

                                    v.

                           BETTY HAMILTON,
                               Appellee.

                              No. 4D14-37

                             [July 23, 2014]

   Appeal of non-final orders from the Circuit Court for the Seventeenth
Judicial Circuit, Broward County; Mily Rodriguez-Powell, Judge; L.T. Case
No. CACE13023844.

   Elana H. Gloetzner of Elana Weintraub Gloetzner, PLC, Southfield,
Michigan, for appellant.

  C. Edward McGee, Jr., of McGee & Huskey, P.A., Fort Lauderdale, for
appellee.

MAY, J.

   A question of personal jurisdiction is at the center of this appeal. A
stepson appeals an order denying his motion to dismiss for lack of
personal jurisdiction and an order granting a temporary injunction. He
argues the trial court erred in denying his motion to dismiss and granting
the temporary injunction because he lacks minimum contacts with the
State of Florida. We agree and reverse.

    The dispute arises out of family owned and operated adult
entertainment establishments in Michigan.              Ownership of the
establishments is governed by the terms of the Hamilton Family
Subchapter S Voting Trust, which was executed in 2006 in Michigan.
Each named beneficiary was given a one-fifth interest in shares of stock in
the businesses. The five beneficiaries of the Trust were: the stepson, John
I. Hamilton, Jr., Charles J. Hamilton, Michael I. Hamilton, and Courtney
Vanloo.   The managing trustee was the father, who managed the
businesses on behalf of the beneficiaries.
   Upon the father’s death in 2010, the surviving spouse and stepmother
became the managing trustee and also acquired John I. Hamilton, Jr.’s
one-fifth interest.  As managing trustee, she maintained the bank
accounts for the businesses. The Trust provided that the managing
trustee “may only be removed by a vote of two-thirds (2/3) of the voting
interest and only at a meeting called for the purpose of removing the
Managing Trustee.”1

   The stepson was interested in selling his stock, but none of the
beneficiaries wanted to purchase it. The beneficiaries, including the
stepson, executed a Stock Restriction Agreement, which set forth various
terms governing the beneficiaries’ disposal of their shares of stock. After
the execution of the Stock Restriction Agreement, the stepson again
expressed his desire to sell his stock; his stepmother agreed to purchase
his interest.

   The stepson asked a family financial adviser in Michigan to prepare and
deliver a preliminary stock purchase agreement setting forth basic terms
to govern the proposed sale to his stepmother. The financial adviser faxed
the “Preliminary Stock Purchase Agreement” to the stepmother’s attorney
in Florida. All of the other beneficiaries were aware of the preliminary offer
to sell the stepson’s interest in the businesses; none of them objected.

    The stepmother and stepson executed the Stock Purchase Agreement.
In return for the stepson’s stock, the stepmother agreed to pay him $2,000
per week for eight years. Paragraph seven of the agreement provided:
“This Agreement is made in the State of Florida and shall be interpreted in
accordance with the laws of the State of Florida. Venue shall be had in
Broward County Florida and all parties agree to accept service of process
by US Mail to the addresses provided above.”

   After the agreement was executed, the other beneficiaries, including the
stepson, held a meeting without the stepmother. At this meeting, the
stepson voted the stock he had already sold to his stepmother to remove
her as the managing trustee. As a result of her removal, the remaining
beneficiaries seized control of the businesses, which included unlawfully
opening new bank accounts and illegally diverting the profits from the
businesses away from the stepmother.

   The stepmother filed suit against her stepson in Broward County for
specific performance, breach of contract, and injunctive relief. Both she

1   The following facts are taken from the allegations of the complaint.

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and her stepson are residents of Michigan, but she has a residence in
Broward County, Florida. The stepson moved to dismiss the complaint for
lack of personal jurisdiction.2

   The trial court heard the stepson’s motion to dismiss and the
stepmother’s motion for temporary injunction. In his motion to dismiss,
the stepson argued that the allegations in the complaint did not establish
a basis for jurisdiction, pursuant to sections 685.102 and 48.193, Florida
Statutes.

   The stepson’s supporting affidavit attested that he is a resident of
Michigan, does not reside in Florida, and has no contacts within Florida.
The stepson does not own, hold, use, possess, or lease any property,
maintain an office, or conduct business in Florida. He further attested
that he has not entered into any contract in Florida and has not engaged
in any acts with the stepmother in Florida. The stepmother did not file a
response or affidavit refuting the attestations.

   At the hearing, the stepson maintained that he had no contacts with
Florida. The stepmother’s counsel argued that the terms of the Stock
Purchase Agreement provided for jurisdiction in Florida, and the stepson
wanted to execute the agreement in Florida because of an impending
divorce.

    The trial court denied the motion, stating:

       I’ve reviewed the Stock Option Agreement, I’ve reviewed the
       Motion to Dismiss, I’ve reviewed the exhibits. I’ve also
       reviewed 685.101 and 102. 101 deals with the choice of laws
       that would apply. 102 deals with jurisdiction. Parties agreed
       under the Stock Option Agreement that jurisdiction would lie
       in Florida in Broward County and the Motion to Dismiss is
       denied.

The court also entered a temporary injunction. The stepson now appeals
the order denying his motion to dismiss and the order granting the
temporary injunction.

2The other beneficiaries, including the stepson, sued the stepmother in Michigan
requesting the court: (1) enter a declaratory judgment concerning the
stepmother’s purchase of shares of stock from the stepson; and (2) void the Stock
Purchase Agreement and enjoin the stepmother from enforcing it.

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    “Generally, a trial court’s ruling on a motion to dismiss for lack of
personal jurisdiction is reviewed de novo. . . . [W]ith respect to the
determination of facts, we defer to the trial court. With respect to the
application of those facts to the law, we review de novo.” Dev. Corp. of Palm
Beach v. WBC Constr., L.L.C., 925 So. 2d 1156, 1160 (Fla. 4th DCA 2006)
(citations omitted) (internal quotation marks omitted).

   Our supreme court has held that “a forum selection clause, designating
Florida as the forum, cannot operate as the sole basis for Florida to
exercise personal jurisdiction over an objecting non-resident defendant.”
McRae v. J.D./M.D., Inc., 511 So. 2d 540, 542 (Fla. 1987). McRae, however,
was decided prior to the enactment of sections 685.101 and 685.102,
Florida Statutes. Those statutes provide a basis for jurisdiction under
particularized circumstances.

   The Third District discussed jurisdiction in light of these statutory
provisions in Jetbroadband WV, LLC v. MasTec North America, Inc., 13 So.
3d 159 (Fla. 3d DCA 2009). “[I]f certain requirements are met, parties
may, by contract alone, confer personal jurisdiction on the courts of
Florida.” Id. at 162. To satisfy the statutory requirements for personal
jurisdiction under section 685.102, the contract, agreement, or
undertaking must:

      1. include a choice of law provision designating Florida law as
         the governing law;

      2. include a provision whereby the non-resident agrees to
         submit to the jurisdiction of the courts of Florida;

      3. involve consideration of not less than $250,000;

      4. not violate the United States Constitution; and

      5. either bear a substantial or reasonable relation to Florida
         or have at least one of the parties be a resident of Florida
         or incorporated under its laws.

Id. The facts alleged in this complaint fail to satisfy these requirements.

    True, the first three factors were satisfied. The Stock Purchase
Agreement provided that Florida law would apply to the agreement. The
parties’ agreement to the mandatory venue provision constituted consent
to jurisdiction in Florida. See Golf Scoring Sys. Unlimited, Inc. v. Remedio,
877 So. 2d 827, 829 (Fla. 4th DCA 2004). And, the Stock Purchase

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Agreement involved consideration of not less than $250,000.

   However, the complaint and the evidence failed to establish the
requisite minimum contacts required by the Constitution. This is the fatal
flaw in the stepmother’s jurisdictional quest. “Factors that go into
determining whether sufficient minimum contacts exist include the
foreseeability that the defendant’s conduct will result in suit in the forum
state and the defendant’s purposeful availment of the forum’s privileges
and protections.” Taskey v. Burtis, 785 So. 2d 557, 559 (Fla. 4th DCA
2001).

   Here, the stepson’s affidavit refuted many, but not all, of the allegations
contained within the complaint. Although faxing the preliminary draft and
final copy of the Stock Purchase Agreement to Florida provided “some”
contact, it was insufficient to establish that the stepson had a connection
with the State of Florida independent of the forum selection clause to
establish the requisite minimum contacts. See id.; see also McRae, 511
So. 2d at 543 (finding no basis independent from the forum selection
clause to exercise jurisdiction). But see Global Satellite Commc’n Co. v.
Sudline, 849 So. 2d 466, 467 (Fla. 4th DCA 2003) (finding a Florida forum
selection clause coupled with the agreement’s requirement that payment
be made in Florida established minimum contacts). The court erred in
denying the motion to dismiss.

   The stepson also challenges the court’s order granting the temporary
injunction. He argues that the court did not have personal jurisdiction
over him, failed to properly evaluate the four requirements for a temporary
injunction, and refused to conduct a full evidentiary hearing. The
stepmother responds that the court had personal jurisdiction over the
stepson, evaluated the evidence, and correctly entered the temporary
injunction. We agree that without personal jurisdiction over the stepson,
the temporary injunction must be vacated.

  We review temporary injunctions for an abuse of discretion. Colucci v.
Kar Kare Auto. Grp., Inc., 918 So. 2d 431, 435 (Fla. 4th DCA 2006).

   We first note that the stepson failed to furnish us with an adequate
record to review this issue. See Applegate v. Barnett Bank, 377 So. 2d
1150 (Fla. 1979).      Nevertheless, the lack of personal jurisdiction
undermines the validity of the temporary injunction.

    We have reviewed Smith v. Knight, 679 So. 2d 359 (Fla. 4th DCA 1996),
relied upon by the stepmother to support the entry of the temporary
injunction, and find it distinguishable. There, we approved the entry of an

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ex parte temporary injunction in the absence of personal jurisdiction.
Because of the ex parte nature of the proceeding, we found no error in the
entry of the temporary injunction because giving notice might have
accelerated the alleged injury. Id. at 361. Here, however, the stepson had
notice, and specially appeared to contest personal jurisdiction. There was
therefore no harm to protect against. We find no merit in the other issues
raised concerning the injunction.

   We therefore reverse the order denying the stepson’s motion to dismiss
for lack of personal jurisdiction, and the order entering the temporary
injunction. We remand the case for dismissal of the complaint.

   Reversed and Remanded.

DAMOORGIAN, C.J., and WARNER, J., concur.

                           *        *        *

   Not final until disposition of timely filed motion for rehearing.

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