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Catalano v. Lease & Rental Management Corp.

September 26, 1991


Arnold, P.J.Cv.


Plaintiff, Fred Catalano, sued Auto-Use, Inc. (Auto-Use) alleging that it unlawfully repossessed his Mercedes Benz automobile. He seeks the return of the automobile. Auto-Use, a Massachusetts corporation, moved to dismiss on the grounds of lack of in personam jurisdiction. After holding a hearing as required by Meeker v. Meeker, 52 N.J. 59, 72, 243 A.2d 801 (1968), this court denied the motion. This opinion supplements this court's oral opinion. R. 2:5-6(c).

The motion raises an issue not decided in any reported decision from a New Jersey court -- who has the burden of proof on the issue of in personam jurisdiction? That issue, and the related issue of how a court should resolve disputes regarding material facts, has been decided by reported decisions of the federal courts. In accordance with those decisions, this court holds that the burden of proof is on plaintiff to establish through sworn affidavits, certifications, or testimony that defendant's contacts with New Jersey are sufficient to give this court in personam jurisdiction. Stranahan Gear Company, Inc. v. N.L. Industries, Inc., 800 F.2d 53 (3 Cir.1986); Nelson by Carson v. Park Industries Inc., 717 F.2d 1120 (7 Cir.1983), cert. den. 465 U.S. 1024, 104 S. Ct. 1277, 79 L. Ed. 2d 682 (1984); American Telephone & Telegraph Co. v.

MCI Communications Corp. 736 F. Supp. 1294 (D.N.J.1990). In deciding whether plaintiff has satisfied this burden, this court will resolve all disputes concerning material facts presented in the record in plaintiff's favor. Nelson by Carson, supra, 717 F.2d at 1123. Resolving all disputes concerning relevant facts in plaintiff's favor, the facts material to the resolution of this motion are as follows.

Plaintiff is the chairman of the board and chief executive officer of Bee Pollen U.S.A. Inc., (Bee Pollen), a New Jersey corporation having its office in Teaneck, New Jersey. In 1984, plaintiff wanted to lease a Mercedes Benz automobile. He telephoned At-Lease Inc. (At-Lease), a New York corporation having its office in New York City, from Bee Pollen's office in New Jersey. At-Lease referred plaintiff to a Mercedes Benz dealer in Newton, New Jersey where plaintiff selected a car. There were discussions over the telephone between plaintiff, from Bee Pollen's New Jersey office, and At-Lease at its New York office, regarding the terms of the lease. The lease was between Bee Pollen and At-Lease. It was signed by plaintiff in New York and by a guarantor in New Jersey, and the car was delivered to plaintiff by the Mercedes Benz dealer in Newton. Plaintiff was then living in Holmes, New York and he registered and insured the car in New York.

The lease between At-Lease and Bee Pollen was executed on a form with the name Auto-Use in bold letters at the top of the form. Beneath it was the address 10 Haverhill Street, Andover, Massachusetts 01810. At the time the lease was signed, At-Lease assigned the lease to Auto-Use. Title to the automobile passed directly from the New Jersey dealer to Auto-Use. Auto-Use does not have an office in New Jersey, nor is it licensed or registered in New Jersey.

Bee Pollen only paid the monthly lease payments for a few months. Those payments were made by checks mailed from New Jersey to Auto-Use in Massachusetts. After Bee Pollen stopped paying, plaintiff then made all subsequent payments by

mailing checks from New Jersey to Auto-Use in Massachusetts. In December 1984, plaintiff moved to Hillsborough Township, New Jersey, registered the car in New Jersey and insured it in New Jersey.

The term of the lease was five years ending in March 1989. It provided that Bee Pollen had an option to purchase the auto for $9,100, which plaintiff testified was exercised on behalf of Bee Pollen. Plaintiff has produced a photocopy of a fully executed retail installment sale contract, dated April 1989, between Bee Pollen and defendant which provides for the sale of the car to Bee Pollen. It is undisputed that plaintiff mailed 14 monthly payments from New Jersey to defendant in Massachusetts, pursuant to the retail installment contract, and that these payments were accepted. Nevertheless, defendant maintains that "no contract to relet or sell the vehicle to plaintiff was made," and has submitted a certification from its president to that effect. This factual dispute for purposes of this motion must be resolved in plaintiff's favor. Nelson by Carson, supra, 717 F.2d at 1123. In June 1990, despite the fact that the retail installment contract provided that "[t]he seller has no right to lawfully enter your premises or commit any breach of peace to repossess goods purchased under this agreement," Auto-Use hired Hawk Repossession, Inc. (Hawk) of Hillside, New Jersey, to repossess the car. When Hawk's employees went to plaintiff's home in Hillsborough Township to repossess the car, they got into an argument with plaintiff and the police were called to maintain order while the car was towed away.

In Lebel v. Everglades Marina, Inc., 115 N.J. 317, 558 A.2d 1252 (1989) the New Jersey Supreme Court noted that 100 years after issuing the opinion in Pennoyer v. Neff, 95 U.S. 714, 24 L. Ed. 565 (1877), the United States Supreme Court "is still laboring to articulate a coherent doctrine of personal jurisdiction within the framework established by that opinion." Lebel, 115 N.J. at 319, 558 A.2d 1252. In deciding Lebel the Court stayed with the basics, i.e., "due process requires only that in order to subject a defendant to a judgment in personam,

if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.'" Id. at 322, 558 A.2d 1252 (quoting International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95, 102 (1945)). In addition, the court ...

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