Court Opinion

ID: 9666118
Source: CourtListenerOpinion
Date Created: 2023-08-24 01:05:23.519584+00
Date Added: 2024-06-11T18:15:23.947964
License: Public Domain

David Newbern, Justice, dissenting. In spite of its recognition that both the provisions of Ark. Code Ann. § 16-4-101 (C) (1) (1987) and the due process “minimum contacts” test must be satisfied, the Court’s opinion holds that the statutory requirement is satisfied because it does not violate the Constitution to subject Keystone Insurance Company to personal jurisdiction in Arkansas. Keystone transacted no business in Arkansas, thus § 16-4-101(C)(1)(a) does not apply. A separate subsection of the long-arm statute permits in personam jurisdiction to be exercised of a party “contracting to supply services ... in this state . . . .” § 16-4-101 (C)(1)(b). That subsection is not at issue here because Mr. Szalay’s sole statutory argument for reversal is that this case arose out of Keystone’s “transacting business” in Arkansas. If the definitions found in the Arkansas Insurance Code are relevant, they show the General Assembly did not define “Transact” there in a way that includes anything done by Keystone in this State. Arkansas Code Ann. § 23-60-102(13) (1987) is as follows: “Transact” with respect to insurance includes any of the following: (A) Solicitation and inducement; (B) Preliminary negotiations; (C) Effectuation of a contract of insurance; (D) Transaction of matters subsequent to effectuation of a contract of insurance and arising out of it[.] There is no evidence whatsoever that Keystone solicited, negotiated, entered, or corresponded with Szalay about the policy or billed him for premiums here. The Court’s opinion is correct in stating that the Due Process Clause would not prohibit the exercise of jurisdiction of an insurance company which could anticipate litigation in this State by virtue of having agreed to protect its insured with respect to accidents which occur here. It is incorrect, however, to base a holding that the long-arm statute is satisfied because it would not be unconstitutional to assert personal jurisdiction of Keystone. This Court has not held that the words of the Statute may be ignored if the Constitution is satisfied, and it should not do so now. The basis of the transition from statute to Constitution in the Court’s opinion is an obiter dictum from CDI Contractors, Inc. v. Goff Steel Erectors, Inc., 301 Ark. 311, 783 S.W.2d 846 (1990). In that case we wrote, “The purpose of this section [16-4-101(C)(1)] is to permit Arkansas courts to exercise the maximum in personam jurisdiction allowable by due process. Martin v. Kelley Elec. Co., 371 F.Supp. 1225 (E.D. Ark. 1974); SD Leasing, Inc. v. Al Spain & Assoc., Inc., 277 Ark. 178, 640 S.W.2d 451 (1982).” In the CDI case we held that mail and telephone contacts which occurred in Arkansas between parties to a contract were insufficient to satisfy the due process requirement. We did not discuss whether the long-arm statute was satisfied. In the Martin case, the U.S. District Court stated the purpose of the long-arm statute “was to permit courts in Arkansas, ... to exercise inpersonam jurisdiction to the furthest limits permitted by due process of law, and that the statute is to be liberally construed.” The holding, however, was that the statute requires that the actions sued upon “arise out of’ the activities which constitute the minimum contacts with this State. The complaint was dismissed for lack of in personam jurisdiction; the statutory requirement had not been met. In the SD Leasing case we did not state that the long-arm statute permits whatever jurisdiction the Constitution permits. Rather, we stated, “We have held that the purpose of this statute is to expand our state’s personal jurisdiction over nonresidents, within the limits permitted by the due process clause of the United States Constitution. Nix v. Dunavant, 249 Ark. 641, 460 S.W.2d 762 (1970). [Emphasis supplied.]” We may have meant “to the extent of the limits,” but we did not say it. Even if that were the interpretation to be given the SD Leasing opinion, however, the holding of that case was that the statute was satisfied because of several acts of the defendant in this State, including the fact that the contract was not effectuated until it was approved here. That is also true of the Nix case where we found the statute satisfied by the negotiation of a contract in Arkansas. Again, the important issue in this case is not whether the Constitution would be violated by permitting Keystone to be sued in Arkansas on its policy. Not only would it not be unconstitutional, but it would make good sense to permit it because, in the language of § 16-4-101 (C) (1) (b), Keystone has agreed to provide a “service” in this State in the form of insurance coverage. Presumably the witnesses to the accident are here and Arkansas law would apply at least to some aspects of the case. The problem is that this decision ignores the very words of the statute on which it must be based. To hold that Keystone has transacted business in this State from which this cause of action has arisen is a bald fiction unsupported by any authority whatever. I respectfully dissent. Holt, C.J., and Dudley, J., join in this dissent.