Court Opinion

ID: 6550724
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:25:15.513284+00
Date Added: 2024-06-11T15:56:06.115121
License: Public Domain

Tom Glaze, Judge, dissenting. I must dissent. Our Supreme Court in SD Leasing, Inc. v. Al Spain & Associates, Inc., 277 Ark. 178, 640 S.W.2d 451 (1982), held that this State’s long-arm statute conferred jurisdiction on an Arkansas court by the completion of the contract in Arkansas although prior negotiations and the contract’s subject matter were in ariother state. Dr. Robert A. Leflar politely referred to SD Leasing as a “marginal case.” See Leflar, Conflict of Laws: Arkansas, 1978-82, 36 Ark.L.Rev. 191, 195 (1982-83). Webster’s New Collegiate Dictionary defines “marginal” as close to the lower limit of qualification, acceptability, or function. If the SD Leasing case is marginal, I must say the instant case clearly falls short of the minimum contacts — or if you will the lower limit of qualification — necessary to confer jurisdiction on Arkansas. Although the majority opinion refers to “appellant’s contacts with Arkansas being few,” I submit that the contacts sufficient to confer jurisdiction on this State are simply non-existent. In reviewing this case, the reader must keep in mind that this Court is affirming the trial court’s decision finding the appellant, a Texas resident, liable as a personal guarantor of a lease agreement between two Arkansas corporations. Appellant’s only contact with these Arkansas corporations was by virtue of his relationship with Composition Management Company (CMC), a Texas corporation. He was CMC’s general counsel and one of its officers and directors. Admittedly, Jerry Sizemore, CMC’s Marketing Director, came to Arkansas and negotiated the sale of two computers to the appellee Worthen Bank which, in turn, leased the equipment to the second Arkansas corporation, Telecompo. Worthen Bank required several guarantees regarding its lease with Telecompo; one was required of the appellant. Appellant’s only involvement with the leasing arrangements that took place in Arkansas was his mailing a financial statement and lease-guaran tee to Worthen Bank. No one questions Arkansas’ jurisdiction over CMC, most likely because CMC (through Sizemore) conducted the business negotiations in Arkansas that led to the lease which was executed and performed in this State. Indisputably, the appellant was never physically within the State of Arkansas. The financial forms (including the individual guarantee) were prepared in Arkansas and mailed to the appellant in Texas. Upon receipt of these instruments, appellant signed and returned them by mail. It is also unrefuted that appellant never personally participated in any of the negotiations in Arkansas that led to the lease in controversy. The majority opinion relies on the fact that appellant was involved with CMC as a director, officer and general counsel and that CMC was directly responsible for the formation of Telecompo. Obviously, appellant had a close connection with CMC, but I am puzzled how my colleagues can parlay CMC’s contacts with this State into exercising in personam jurisdiction over appellant. Again, the majority in part relies upon World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980), stating that “appellant should have reasonably anticipated being haled into court in Arkansas if the lease went into default.” Of course, appellant’s expectations or anticipations are not the benchmark for determining whether his contacts with Arkansas were sufficient to withstand a due process challenge to the exercise of in personam jurisdiction over him. In sum, the majority opinion is premised on appellant’s relationship with CMC to substantiate this Court’s decision to extend in personam jurisdiction over him. Unquestionably, we have fewer contacts here than in SD Leasing. Under the test of minimum contacts and fair play, I am convinced that Arkansas’ assumption of in personam jurisdiction over appellant violates his due process rights. I cannot conceive of our Supreme Court’s interpreting Jts^ long-arm statute to gather in out-of-state residents who, like appellant, have virtually no personal contacts with our State’s borders. I would reverse. I am authorized to state that Corbin, J., joins in this dissent.