IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
July 13, 2005 Session
LAW OFFICES OF HUGO HARMATZ v. STEVE DORROUGH, ET AL.
Appeal from the Circuit Court for Knox County
No. 1-94-03 Dale C. Workman, Judge
No. E2004-01987-COA-R3-CV - FILED JULY 20, 2005
This is an action to enforce a foreign judgment. The trial court granted the Defendants’ motion to
dismiss due to lack of personal jurisdiction, subject matter jurisdiction and improper venue. Because
the Plaintiff failed to establish a prima facie case that personal jurisdiction over any of the
Defendants was proper, we affirm the judgment of the trial court as modified to clarify that the
dismissal is without prejudice.
Tenn. R. Civ. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed as
Modified; Case Remanded
SHARON G. LEE, J., delivered the opinion of the court, in which HERSCHEL P. FRANKS, P.J., joined.
D. MICHAEL SWINEY , J., filed a separate dissenting opinion.
Michael W. Fortune, Knoxville, Tennessee, for the Appellant, Law Offices of Hugo Harmatz.
John O. Threadgill, Knoxville, Tennessee, for the Appellee, Steve Dorrough, Jayme Dorrough, and
Nomad Investment Group, Inc.
OPINION
On February 14, 2003, the Plaintiff, Law Offices of Hugo Harmatz, filed its complaint to
enforce a foreign judgment entered in New Jersey. The complaint states in relevant part as follows:
That the Plaintiff, Law Offices of Hugo Harmatz, is a company which
operates in the State of New Jersey and is located at P.O. Box 500,
Colts Neck, NJ 07722-0500.
That the Defendants, Steve Dorrough and Jayme Dorrough, can be
served at the above address of their attorney of record, Lynn Tarpy,
who represented the Defendants against the Plaintiff in the Circuit
Court for Knox County, Tennessee, Docket No. 1-633-01. That the
Defendant, Nomad Investment Group, Inc., is not listed as a
corporation with the Secretary of State for the State of Tennessee and
therefore, does not have a specific process server identified, and can
be served at the above address of its attorney of record, Lynn Tarpy,
who represented the Defendant against the Plaintiff in the Circuit
Court for Knox County, Tennessee, Docket No. 1-633-01.
That on the 17th day of July, 2001, in the Superior Court for New
Jersey, Law Division, Monmouth County, Docket Number MON-L-
552-01, the Plaintiff recovered a judgment against the Defendants in
the amount of Forty Three Thousand Five Hundred Twenty One and
50/100 ($43,521.50) Dollars plus costs. A certified copy of the
judgment is attached hereto as Exhibit “A”.
That this judgment is still in full force and effect, and no part of the
judgment has been paid and satisfied.
[Numbering in original omitted].
The Defendants responded with a motion to dismiss pursuant to Tenn. R. Civ. P. 12.02, on
the grounds that the court “lacks subject matter jurisdiction, personal jurisdiction and venue is
improper[.]” A hearing was held on the matter, but no transcript was made of the hearing and no
party has filed a statement of the proceedings. On July 24, 2004, the trial court entered an order that
states in its entirety, “[u]pon Motion of Defendants and for good cause shown, this case is hereby
dismissed with costs taxed to the Plaintiff.”
Plaintiff argues on appeal that the trial court dismissed its action on grounds that service of
process was insufficient, and its appellate brief is devoted entirely to arguing that its service of
process upon Defendants in Florida was sufficient. However, Defendants’ motion does not raise as
a ground for dismissal insufficiency of service of process, which is specifically and individually
enumerated as a separate ground in Rule 12.02. Tenn. R. Civ. P. 12.02(5). Moreover, there is
nothing in the trial court’s judgment, or in the remainder of the record, that mentions sufficiency (or
lack thereof) of service of process. The determinative issue, as we perceive it, is whether the action
was correctly dismissed for lack of personal jurisdiction over the Defendants.
In the case of Chenault v. Walker, 36 S.W.3d 45 (Tenn. 2001), the Supreme Court provided
guidelines for consideration of a motion to dismiss for lack of personal jurisdiction, addressing the
question of “[w]ith what certainty must the facts be established in the record for a judge to determine
that personal jurisdiction exists over the defendants?” Id. at 55. The Court stated as follows:
Under the Tennessee Rules of Civil Procedure a motion to dismiss
may be based on one or more of eight grounds, including lack of
personal jurisdiction and failure to state a claim on which relief can
be granted. See Tenn. R. Civ. P. 12.02. A court either decides this
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motion based on the allegations contained in the pleadings or, if
matters outside the pleadings--such as affidavits--are presented, the
court will treat the motion as one for summary judgment as provided
in Tenn. R. Civ. P. 56. See Tenn. R. Civ. P. 12.03.
As we have stated in the past, however, Rule 12.03 does not apply to
a motion to dismiss for lack of personal jurisdiction, unless the
evidence brought to the court is so conclusive that the motion may be
fully and finally resolved on the merits. See Nicholstone Book
Bindery, Inc. v. Chelsea House Publishers, 621 S.W.2d 560, 561 n.
1 (Tenn.1981) ("[S]ummary judgment procedure does not properly
apply to jurisdictional issues.") (quoting 6 Moore, Federal Practice
(Part 2) § 56.17(36) at 913 (1980)).
* * *
Regardless of the theory on which personal jurisdiction is based,
though, the necessity of adopting a middle-ground solution--between
relying merely on the pleadings and postponing a decision on
jurisdiction until discovery has been completed--is apparent. Many
federal courts have dealt with this issue, and there appears to be
considerable agreement on several aspects of the procedure necessary
to determine whether the evidence in favor of finding jurisdiction is
sufficient to allow the case to proceed. . . If the defendant challenges
jurisdiction by filing affidavits, the plaintiff must establish a prima
facie showing of jurisdiction by responding with its own affidavits
and, if useful, other written evidence. See Posner v. Essex Ins. Co.
Ltd., 178 F.3d 1209, 1214 (11th Cir.1999); Bank Brussels Lambert v.
Fiddler Gonzalez & Rodriguez, 171 F.3d 779, 784 (2nd Cir.1999);
OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091
(10th Cir.1998). A court will take as true the allegations of the
nonmoving party and resolve all factual disputes in its favor, see
Posner, 178 F.3d at 1215; IMO Industries, Inc. v. Kiekert AG, 155
F.3d 254, 257 (3rd Cir.1998), but it should not credit conclusory
allegations or draw farfetched inferences, see Massachusetts School
of Law, 142 F.3d at 34.
Chenault v. Walker, 36 S.W.3d at 55-56 (Tenn. 2001)[footnote omitted].
Tennessee’s long-arm statute, Tenn. Code Ann. § 20-2-214, allows Tennessee courts to
exercise jurisdiction to the extent the Fourteenth Amendment to the United States Constitution
permits. Id. at 52-53; Humphreys v. Selvey, 154 S.W.3d 544, 550 (Tenn. Ct. App. 2004). The long-
arm statute provides:
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(a) Persons who are nonresidents of Tennessee and residents of
Tennessee who are outside the state and cannot be personally served
with process within the state are subject to the jurisdiction of the
courts of this state as to any action or claim for relief arising from:
(1) The transaction of any business within the state;
(2) Any tortious act or omission within this state;
(3) The ownership or possession of any interest in property located
within this state;
(4) Entering into any contract of insurance, indemnity, or guaranty
covering any person, property, or risk located within this state at the
time of contracting;
(5) Entering into a contract for services to be rendered or for materials
to be furnished in this state;
(6) Any basis not inconsistent with the constitution of this state or of
the United States;
(7) Any action of divorce, annulment or separate maintenance where
the parties lived in the marital relationship within this state,
notwithstanding one party's subsequent departure from this state, as
to all obligations arising for alimony, custody, child support, or
marital dissolution agreement, if the other party to the marital
relationship continues to reside in this state.
(b) "Person," as used herein, includes corporations and all other
entities which would be subject to service of process if present in this
state.
(c) Any such person shall be deemed to have submitted to the
jurisdiction of this state who acts in the manner above described
through an agent or personal representative.
Tenn. Code Ann. § 20-2-214.
Due process requires that an out-of-state defendant can be subject to personal jurisdiction
only if the defendant has such minimum contacts with the forum state that the maintenance of the
action does not offend traditional notions of fair play and substantial justice. Chenault, 36 S.W.3d
at 53; J.I. Case Corp. v. Williams, 832 S.W.2d 530, 531-33 (Tenn. 1992)(citing International Shoe
Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945)); see also Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 471-78, 105 S.Ct. 2174, 2181-84, 85 L.Ed.2d 528 (1985); World-Wide
Volkswagen Corp. v. Woodson, 444 U.S. 286, 291-94, 100 S. Ct. 559, 564-66, 62 L.Ed.2d 490
(1980).
Courts recognize two types of personal jurisdiction: general jurisdiction and specific
jurisdiction. United Agricultural Services, Inc. v. Scherer, 17 S.W.3d 252, 256 (Tenn. Ct. App.
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1999). When a state exercises personal jurisdiction over a defendant in a lawsuit not arising out of
or related to the defendant’s contacts with the forum, the state is exercising general jurisdiction over
the defendant. Id.; Helicopteros Nationales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n.9, 104
S. Ct. 1868, 1872 n. 9, 80 L.Ed.2d 404 (1984). When a state exercises personal jurisdiction over a
defendant in a lawsuit arising out of or related to the defendant’s contacts with the forum, the state
is exercising specific jurisdiction over the defendant. Id; Helicopteros, 466 U.S. at 414 n. 8; 104
S.Ct. at 1872 n. 8.
For a court to exercise personal jurisdiction of a general nature over a nonresident defendant,
the proof must show that the defendant maintains “continuous and systematic” contacts with the
foreign state. Scherer, 17 S.W.3d at 256; International Shoe Co. v. Washington, 326 U.S. 310, 317,
66 S.Ct. 154, 159 (1945). However, in the absence of general jurisdiction resulting from continuous
and systematic contacts with the forum state, specific personal jurisdiction exists when a commercial
actor purposely directs his activities toward citizens of the forum state and litigation results from
injuries arising out of or relating to those activities. Chenault, 36 S.W.3d at 53; Scherer, 17 S.W.3d
at 256. In such a case, “the defendant’s conduct and connection with the forum State are such that
he should reasonably anticipate being haled into court there.” Id. “In addition to an evaluation of
the defendant’s contacts and their connection to the plaintiff’s cause of action, courts consider two
lesser factors: the forum state’s interest in exercising jurisdiction and the convenience to the parties.”
Chenault, 36 S.W.3d at 53.
In the present case, construing the allegations of the complaint in a light most favorable to
the Plaintiff, the complaint contains nothing to demonstrate that Defendants have maintained
continuous and systematic contacts with Tennessee, that the subject matter of this cause of action
bears any relation with Tennessee, or that the Defendants are residents of Tennessee. The record
shows that Plaintiff unsuccessfully attempted to serve process on Defendants in Tennessee several
times, before serving process on them in Jensen Beach, Florida.
Defendants’ motion to dismiss was unsupported by accompanying affidavits or any other
proof. The question thus arises: was the unsupported motion sufficient for the court to dismiss the
action based on lack of personal jurisdiction? Under the circumstances of the present case, we
believe it was. Importantly, the complaint makes no allegation tending to establish jurisdiction other
than the allegation, which we accept as true, that the parties were at some earlier time involved in
litigation in Knox County, Tennessee. This court has on numerous occasions reiterated the Supreme
Court’s ruling that “[i]t is clear that the plaintiff bears the ultimate burden of demonstrating that
jurisdiction exists.” Chenault, 36 S.W.3d at 56; Humphreys v. Selvey, 154 S.W.3d 544, 548 (“The
plaintiff has the burden of establishing a prima facie case that personal jurisdiction over a defendant
is proper.”); Manufacturers Consolidation Serv., Inc. v. Rodell, 42 S.W.3d 846, 854 (Tenn. Ct. App.
2000); Lucite International, Inc. v. Runciman, C/A No. W2004-00314-COA-R3-CV, 2005 WL
394775 at *2, 2005 Tenn. App. LEXIS 104 (Tenn. Ct. App. W.S., filed Feb. 18, 2005); Davis-Kidd
Booksellers, Inc. v. Day-Impex, Ltd., 832 S.W.2d 572, 577 (Tenn. Ct. App. 1992)(holding plaintiffs
failed to carry burden of establishing prima facie case of personal jurisdiction).
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In Humphreys v. Selvey, this court was presented with a situation similar to the present case,
in that the defendants filed an unsupported motion to dismiss based on lack of personal jurisdiction.
The Humphreys court stated:
Humphreys contends that Selvey's motion to dismiss "was not
'properly supported' because [defendant] failed to submit any
evidence in the form of affidavits, sworn statements, declarations,
testimony, or otherwise in support of his motion." (emphasis in
original). In Manufacturers Consolidation Serv., Inc. v. Rodell, 42
S.W.3d 846, 854 (Tenn.Ct.App.2000), the court noted that where "the
defendant challenges the trial court's personal jurisdiction over him
by filing a properly supported motion to dismiss, 'the plaintiff may
not stand on his pleadings but must, by affidavit or otherwise, set
forth specific facts showing that the court has jurisdiction.' " (quoting
Theunissen v. Matthews, 935 F.2d 1454, 1458 (6th Cir.1991); accord
Serras v. First Tennessee Bank Nat'l Ass'n, 875 F.2d 1212, 1214 (6th
Cir.1989)). The above-cited authority does not stand for the position
that a movant is required to file affidavits or evidentiary documents
in support of their motion, but rather provides that where a movant
files affidavits or similar evidentiary documents in support of a
motion to dismiss, a plaintiff "must, by affidavit or otherwise, set
forth specific facts showing that the court has jurisdiction." See id.
Humphreys, 154 S.W.3d at 550 n. 5 (Tenn. Ct. App. 2004).
In response to Defendants’ motion to dismiss, Plaintiff had the options of amending its
complaint to include sufficient jurisdictional allegations, filing affidavits to establish personal
jurisdiction, or making an offer of proof to the trial court at the hearing. Plaintiff took none of these
actions, and we find therefore that it failed to meet its burden to establish a prima facie case that
personal jurisdiction over the Defendants was proper.
In its judgment dismissing the case, the trial court did not state whether it was dismissing the
action with prejudice. In Rodell, 42 S.W.3d 846, 855 n.5 (Tenn. Ct. App. 2000), the court noted that
“dismissal for lack of personal jurisdiction should be without prejudice.” We modify the trial court’s
judgment to clarify that Plaintiff’s action is dismissed without prejudice, and for the aforementioned
reasons, we affirm the trial court’s judgment as modified. Costs on appeal are assessed to the
Appellant, Law Offices of Hugo Harmatz, and its surety.
_________________________________________
SHARON G. LEE, JUDGE
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