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S.D. Sales Corp. v. Doltex Fabrics Corp.

Decided: October 10, 1966.

S.D. SALES CORP., A NEW YORK CORPORATION, PLAINTIFF,
v.
DOLTEX FABRICS CORP., A NEW YORK CORPORATION, DEFENDANT



Botter, J.s.c.

Botter

The issue posed is whether the court should invoke the doctrine of forum non conveniens to decline jurisdiction in an action commenced by attachment. Both parties are New York corporations not authorized to do business in New Jersey; plaintiff can readily sue defendant in New York; the cause of action arose outside of New Jersey, and the dispute is unrelated to this State except that defendant's goods, which could be attached, were here for processing by a third party.

Plaintiff obtained an order for a writ of attachment, claiming defendant owes plaintiff $13,000 on an open account for services rendered in printing and dyeing textile materials. The attachment was executed against 10,000 yards of cotton velour owned by defendant which were in New Jersey in the hands of a processor for dry finishing. Notice of the attachment

was then given to defendant, and defendant has moved to quash the attachment. R.R. 4:77-14 and 16.

The Legislature has provided that an attachment "may issue" where "the defendant absconds or is a nonresident of this state, and a summons cannot be served on him in this state * * *." N.J.S. 2A:26-2(b). An attachment against a nonresident's property within the State is a means of obtaining jurisdiction over defendant to the extent of the property attached. Pennoyer v. Neff, 95 U.S. 714, 24 L. Ed. 565 (1877). The fact that defendant is a New York corporation not authorized to do business in New Jersey and cannot be served with a summons in New Jersey brings defendant within the scope of our Attachment Act. Goldmark v. Magnolia Metal Co., 65 N.J.L. 341 (Sup. Ct. 1900). Here, however, defendant's obligation did not arise by contract made or to be performed in New Jersey. The parties and the litigation have no relationship to New Jersey except that defendant sends goods into New Jersey from time to time for processing.

It is difficult to say if there is a precise holding on the issue here posed in any reported New Jersey decision. In Goldmark v. Magnolia Metal Co., supra, the court held that an attachment will lie against a foreign corporation for the recovery of a debt which arose outside the State. However, there is no reference in the opinion to plaintiff's residence. Court records showing plaintiff's residence are no longer available. It may be that the case merely holds that a New Jersey resident can attach a foreign corporation's assets to pursue a cause of action which arose within or without the State. If this is so, the holding would be unremarkable and unrelated to the problem at hand.

In Pan American Securities Corp. of New York v. Fried, Krupp Aktiengesellschaft, a German Corp., 16 N.J. Misc. 225 (Cir. Ct. 1938), the court said that a New York corporation can attach the property of a German corporation to pursue a claim on negotiable bonds not issued or payable in New Jersey and not otherwise connected with New Jersey. The attachment was made upon certain rights and credits owing

to defendant from New Jersey corporations. The literal statutory requirements for an attachment were satisfied, namely, defendant was a nonresident and could not be served in New Jersey. The court retained jurisdiction without describing the factors which militated against applying the forum non conveniens doctrine. The doctrine was not even mentioned by name in the opinion. But the court was dealing with an application for pretrial discovery only, and the right was reserved at the trial on a sufficient showing to decline jurisdiction by "judicial application of the principles of public policy, or comity * * *." (at p. 230)

Our Supreme Court has recently applied forum non conveniens where personal service upon a foreign corporation was made in New Jersey in actions brought by residents of European countries. Semanishin v. Metropolitan Life Ins. Co., 46 N.J. 531 (1966). The court there said that the doctrine may be applied to protect the "citizens of a state from the unjustifiable burden imposed upon them when controversies having no connection with the state are allowed to proceed to trial." 46 N.J., at p. 533, citing Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 67 S. Ct. 839, 91 L. Ed. 1055 (1947). If a court, on grounds of forum non conveniens, can decline to take jurisdiction when effective personal service can be made upon defendant, the court should have as much discretion to decline jurisdiction where service is obtained by an attachment process. The issue is not how jurisdiction was obtained. The issue is whether jurisdiction should be retained over a dispute that is essentially foreign to the chosen forum. In other jurisdictions the doctrine has been applied on occasion to reject jurisdiction in cases similar to the case at hand. See Plum v. Tampax, Inc., 399 Pa. 553, 160 A. 2 d 549 (Sup. Ct. 1960); Russell v. Wilson, 18 La. 367 (Sup. Ct. 1841); Central Pub. Co. Inc. v. Wittman, 283 App. Div. 492, 128 N.Y.S. 2 d 769 (App. Div. 1954). See also the New York Business Corporation Law, McKinney's Consol. Laws, c. 4, § 1314(b), which denies jurisdiction in an action against a foreign corporation by a nonresident or another foreign corporation unless certain

conditions are met which in general connect the parties or the cause of action to New York. This statute reflects New York's "policy against lending its courts to the resolution of disputes between nonresident parties * * *." Simonson v. International Bank, 14 N.Y. 2 d 281, 285, 251 N.Y.S. 2 d 433, 435, 200 N.E. 2 d 427, 429 (Ct. App. 1964). If a defendant foreign corporation does not have sufficient contact with New York to be subject to personal service in that jurisdiction*fn1 and the other conditions establishing a nexus with New York do not exist, a New Jersey corporation or other nonresident of New York could not bring an action of this kind in New York. See Cala v. Luis De Ridder Ltda., S.A., 17 A.D. 2 d 729, 232 N.Y.S. 2 d 284 (App. Div. 1962), holding that a foreign corporation cannot maintain an action commenced by attachment against another foreign corporation in New York where the cause of action did not arise in New York, citing New York General Corporation Law, section 225, now New York Business Corporation Law, § 1314, supra. A contrary view may be found in the following cases, although distinguishing facts may have impelled retention of jurisdiction. Aero Spray, Inc. ...


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