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Lebel v. Everglades Marina Inc.

Decided: May 31, 1988.


On appeal from the Superior Court of New Jersey, Law Division, Bergen County.

King, Gruccio and D'Annunzio. The opinion of the court was delivered by King, P.J.A.D.


[225 NJSuper Page 317] We granted leave to appeal the decision of a Law Division judge finding in personam jurisdiction over a Florida corporation being sued by a citizen of New Jersey in our courts. R.

2:2-4. We find that insufficient minimum contacts existed between the defendant corporation and this State and that the defendant did not purposefully avail itself of New Jersey as a place to do business or intentionally put its product in the stream of commerce in this State. In fairness to the defendant and in the interest of allocative efficiency, this forum will not assert in personam jurisdiction in this case. We reverse.

In 1984, Richard Lebel, a New Jersey resident, attended a boat show in New York City where he met a representative of defendant Everglades Marina, Inc., (Everglades) a Florida corporation, and discussed the purchase of a "Cigarette Speed-Boat" for about $200,000. Lebel asserts that he spoke on the telephone from New Jersey with a representative of Everglades in Florida at least 20 times between 1984 and 1986. He said that he discussed the purchase of the boat and his intention to use it in New Jersey during the summer months. The representative from Everglades denied meeting Lebel in New York City and contended that all discussions about the boat occurred in 1986 by long-distance phone calls.

Lebel finally purchased a 1987 Cigarette Speed-Boat for $215,580 from the Everglades headquarters in Fort Lauderdale, Florida. The sales agreement, dated June 24, 1986, was sent to Lebel in New Jersey which he signed and returned to Florida. The boat was delivered, registered, and stored in Florida. Sometime after the purchase Lebel arranged for a third-party hauler to bring the boat to New Jersey.*fn1 The hauler was involved in an accident while in transit to New Jersey (we do not know where) and the boat was damaged. The boat never even reached New Jersey and was then returned to Florida, where Lebel later sold it to a third party.

On September 11, 1987 a complaint was filed in New Jersey against Everglades by Lebel alleging fraud, negligent repairs,

breach of the warranty of merchantability, and improper storage and maintainance. The defendant was served in Florida by the sheriff's department. R. 4:4-4(a)(1). Everglades filed a motion to dismiss for lack of personal jurisdiction. As noted, the Law Division judge denied the motion. He decided that there were sufficient minimum contacts between the defendant and this forum to exercise in personam jurisdiction. On February 22, 1988 we granted defendant's motion for leave to appeal and now reverse.

A long line of cases address the right of a state to reach out and hale a citizen of another state or nation into its jurisdiction in an action for damages. The decision on whether to exercise jurisdiction focuses upon two factors: (1) whether "minimum contacts" have occurred between the defendant and the forum state and (2) whether the contacts themselves are sufficient under the specific circumstances of the case for the defendant reasonably to expect to be forced to litigate in the forum state.

Due process requires that in order for the defendant to be subject to in personam jurisdiction it have certain minimum contacts with a state so that the maintenance of the suit does not offend "traditional notions of fair play and substantial justice." International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95 (1945). Plaintiff here urges that the defendant had contacts with this State because: (1) defendant's representative spoke with plaintiff about the boat on a number of occasions by long-distance telephone from Florida; (2) defendant knew plaintiff would bring the boat to New Jersey at some time; (3) defendant sent the contract to New Jersey to be signed; (4) the first contact was at a boat show in New York. However, the fact remains that the boat never reached New Jersey. It was delivered and registered in Florida, stored there, and maintained there. It was in transit to New Jersey when the third-party hauler was in an accident and the boat was damaged.

In similar cases where other New Jersey courts have found in personam jurisdiction the merchandise had been delivered to New Jersey through a stream of commerce flowing into this State. The court exercised in personam jurisdiction over a Maryland corporation which sold a truck to a New Jersey resident in Dave's Trash Removal v. Charm City Equipment Corp., 214 N.J. Super. 497 (App.Div.1987). The defendant was charged by the plaintiff, a New Jersey resident, with breach of warranty. We there held that the truck had entered the stream of commerce in New Jersey and that the defendant corporation reasonably should have expected to be brought into a New Jersey court if the truck did not operate properly. But see Helicopteros Nacionales de Columbia v. Hall, 466 U.S. 408, 104 S. Ct. 1868, 80 L. Ed. 2d 404 (1984) (if the claims do not arise in the forum state and are not related to it, contacts of a defendant corporation are more closely scrutinized). Cf. Washington v. Magazzu, 216 N.J. Super. 23 (App.Div.1987) (we found no jurisdiction over an attorney from Virginia sued for malpractice who had been contacted by a New Jersey lawyer to litigate a medical malpractice case for a New ...

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