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Sablic v. Croatia Line

October 23, 1998


Before Judges Pressler, Brochin and Kleiner

The opinion of the court was delivered by: The opinion of the court was delivered by Brochin, J.A.D.

[9]    Argued September 15, 1998

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

Plaintiff Zvonimir Sablic has appealed from a final judgment of the Law Division dismissing his complaint. The judgment was entered on the motion of defendant Croatia Line for summary judgment. The motion court held, in accordance with defendant's contentions, that it lacked personal jurisdiction over defendant because defendant had not been properly served, that it was without subject matter jurisdiction to adjudicate plaintiff's claims against defendant because defendant did not have sufficient contacts with the State of New Jersey to satisfy the requirements of due process, and that the Foreign Sovereign Immunity Act, 28 U.S.C.A. § 1602 et. seq., immunized defendant from suit on plaintiff's claims in New Jersey courts. Defendant also moved to dismiss plaintiff's claims on the ground of forum non conveniens, but the motion court did not rule on that contention for dismissal because its holdings on the other grounds urged by defendant disposed of the action. For the following reasons, we disagree with the motion court's holding that Croatia Line's contacts with New Jersey were insufficient to subject it to general in personam jurisdiction and that service of process was defective. However, we affirm the motion court's ruling that the Federal Sovereign Immunity Act immunizes Croatia Line from having to respond to Sablic's claims in our courts.

Because this is an appeal from an order for summary judgment, we are required to accept plaintiff's evidence as true and to give him the benefit of all favorable inferences that can reasonably be drawn therefrom. Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520 (1995). We will summarize the facts of the case in accordance with those principles.

Croatia Line is an entity which operates a steamship line, transporting cargo to and from Port Newark. Its headquarters are located in Croatia and its management is Croatian. It was formed with the name Jugoslovenska Linijska Plovidba ("Jugolinija") under the laws of the former Yugoslavia, and upon the fragmentation of that state, its name was changed to Croatia Line. The entity continued to operate under the laws of Croatia, a successor state.

Plaintiff is a Croatian national. He was granted political asylum in this country as a political refugee. He now resides in New York.

According to plaintiff's complaint, he was employed by Croatia Line and its predecessor and, from time to time, by various affiliated companies for approximately twenty-five years. He alleges that beginning in August 1995, while he was stationed in Hungary, he was threatened and assaulted at the direction Croatia Line, and that sometime between September 1995 and February 1996, he was wrongfully dismissed from his employment. Plaintiff asserts that the motive for the threats and assaults against him and for his termination was his active political opposition to the ruling Croatian political party. He does not contend that any of the conduct which forms the basis for his claims occurred in New Jersey or anywhere else in the United States.

Croatia Line itself is not authorized to transact intrastate business in New Jersey. It does not own or rent real property in the State. It has no telephone listing here in its own name, and there is no evidence that it has any bank accounts or employees in the state. For almost the past fifty years, however, Croatia Line and its predecessor have maintained regularly scheduled steamship service to and from Universal Terminal, Shed 220, Calcutta Street, Port Newark, New Jersey. The vessels of Croatia Line are berthed, loaded and discharged there, and cargo is received there from shippers and delivered to consignees. In connection with this operation, Croatia Line maintains a fleet of trailer chassis at Port Newark upon which containers for shipping cargo are moved to and from its vessels.

In order to conduct its shipping operations to and from Port Newark, Croatia Line utilizes the services of two affiliated corporations, Croatia Line of North America, Inc. and Crossocean Shipping Co., Inc. Both corporations have their offices at the Meadowlands Complex, Rutherford, New Jersey. Croatia Line of North America, Inc. is a subsidiary of a Liberian corporate subsidiary of Croatia Line. Crossocean Shipping Co., Inc. is a corporate subsidiary of Croatia Line of North America, Inc.

In the tariff filed with the Federal Maritime Commission, Croatia Line listed Crossocean Shipping, Inc. as its "general agents" and as authorized to enter into credit agreements with shippers on its behalf. Crossocean Shipping Co., Inc. is listed as the agent for Croatia Line in the Port of New York and Port of New Jersey's 1996 Port Guide. On behalf of Croatia Line, Crossocean Shipping Co., Inc. issues shipping documents; it bills and collects freight charges; it handles payments for leasing and maintenance of equipment; it solicits and books cargo and arranges to receive it for carriage from the United States, including from New Jersey, to foreign ports; it arranges for unloading and discharging cargo from Croatia Line's vessels; it arranges delivery of cargo from Croatia Line vessels to consignees in New Jersey; and it handles damage claims.

Croatia Line of North America, Inc. operates a regional center for Croatia Line. A general manager of Croatia Line explained in an interview published in the Croatia newspaper, Novi List, that "Regional Centers are located in the main company's markets and they act as the long hand of the shipping line's headquarters for marketing, ships' operations, container equipment operations, documentation control, financial operations and control of the agents in the region."

Defendant has not disputed these facts. It argues, however, that the presence of corporate subsidiaries within New Jersey is insufficient to subject the subsidiary's parent corporation to the subject matter jurisdiction of our courts. We agree, of course, that the mere presence of corporate subsidiaries within a state does not establish the minimum contacts necessary to sustain general in personam jurisdiction. Cannon Mfg. Co. v. Cudahy Packing Co., 267 U.S. 333, 336-37, 45 S. Ct. 250, 251-52, 69 L. Ed. 634 (1925); Unicom Invs. v. Fisco, Inc., 137 N.J. Super. 395, 401 (Law Div. 1975); Restatement (Second) of Conflicts of Laws § 52 comment b (1971) ("Judicial jurisdiction over a subsidiary corporation does not of itself give a state judicial jurisdiction over the parent corporation."). But it is black-letter law that the substantial, continuous activity of agents of a corporation within a jurisdiction establishes the minimum contacts which are required by due process. International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95 (1945); Giangola v. Walt Disney World Co., 753 F. Supp. 148, 154 (D.N.J. 1990). This rule applies whether the agent is a corporation or an individual. Substantial continuous activity within the state by one corporation acting as agent for another authorizes the courts of the state to exercise general in personam jurisdiction over the principal. Grand Entertainment Group v. Star Media Sales, Inc., 988 F.2d 476, 483 (3d Cir. 1993); Automated Salvage Transport Inc. v. NJ Koninklijefe KNP BT, No. CIV. A.96-369, 1997 WL 576402, at *51 (D.N.J. Sept. 12, 1997). Because plaintiff's factual allegations on this issue are undisputed, we hold as a matter of law that our court's exercise of subject matter jurisdiction over defendant is consistent with due process.

The Bergen County Sheriff first served plaintiff's summons and complaint on an employee of Crossocean Shipping Co., Inc. at its headquarters in Rutherford, New Jersey. Plaintiff describes the employee who received the summons and complaint as the claims manager of Crossocean Shipping, Inc. Defendant describes her as Crossocean's receptionist. Service was also made pursuant to R. 4:4-3(b)(1) and R. 4:4-4(a)(6) by delivering the summons and complaint to the person who was the president of Crossocean Shipping Co., Inc. and of Croatia Line of North America, Inc. at their Rutherford offices. The Bergen County Sheriff subsequently served Crossocean Shipping, Inc. and Croatia Line of North America, Inc. by delivering the summons and complaint to an individual whom the sheriff's officer identified in his return as the person in charge of their Rutherford offices. Later, a ...

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