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North American Window & Door Co., Inc. v. American Properties Realty

May 21, 2009


On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. DJ-300871-07.

Per curiam.


Argued April 27, 2009

Before Judges Lisa and Sapp-Peterson.

Plaintiff, North American Window and Door Co., Inc. (North American) obtained a default judgment against defendants in the Court of Common Pleas of Chester County, Pennsylvania on September 20, 2007 in the amount of $59,808.74, together with 1.5% per month interest from December 12, 2005, plus costs of suit. Defendants are related New Jersey entities, headquartered in New Jersey, and conduct business exclusively in New Jersey. They both conduct business at the same address in Iselin. After North American obtained the judgment, it docketed it in the New Jersey Superior Court. Defendants moved to vacate the docketed judgment, contending the Pennsylvania court lacked personal jurisdiction over them. Based upon the motion record, and after hearing oral argument, Judge Kieser denied the motion. He issued an order to that effect on February 5, 2008, which included a comprehensive written statement of reasons.

On appeal, the principal argument presented by defendants is that Judge Kieser's finding that defendants had sufficient minimum contacts with Pennsylvania to justify long-arm jurisdiction and that subjecting defendants to long-arm jurisdiction did not offend traditional notions of fair play and substantial justice was erroneous. Defendants further argue that the judge erred in refusing to vacate the default judgment because one of the defendants was not a party to the underlying agreement with North American and North American was not the party with which defendants exclusively dealt.*fn1 Finally, they argue the judge erred in refusing to vacate that portion of the default judgment providing for 1.5% interest per month both pre and post-judgment. We reject these arguments and affirm substantially for the reasons expressed by Judge Kieser in his February 5, 2008 order and decision.

North American's principal place of business is in West Chester, Pennsylvania. It is a regional distributor of high-end doors and windows for estate homes, country clubs and commercial establishments. Defendant American Properties Realty, Inc., and its affiliated companies, are in the business of constructing luxury single-family estates in master planned communities of apartments, condominiums and townhouses. It has been in business for more than thirty years and has constructed about 15,000 such housing units.

As part of one of its construction projects for luxury condominiums in Demarest, defendants sought to purchase custom doors from North American. Although the initial contact occurred in New Jersey, negotiations and exchange of information proceeded for a period of about six months, by telephone, fax, and other communications, directed to North American's Pennsylvania business location, leading up to an order on May 26, 2005. At that time, defendants ordered custom doors for a total price of $190,651.60. The order was placed by fax and phone directed to North American's Pennsylvania address. On several occasions during the dealings between the parties, employees of defendants told North American's employees that defendants wanted North American to submit proposals on other projects they were considering.

On June 27, 2005, North American received from defendants a $63,550.51 deposit at its Pennsylvania office. On July 26, 2005, defendants modified the specifications and mailed and faxed the change order to Pennsylvania, resulting in additional charges of $2,883.20. Until all of the specifications were finalized, the doors could not be manufactured. As requested by defendants, the doors were manufactured by Architectural Doors, Inc., which is located in New Jersey.

Shipments were made to defendants' construction site as requested. Shipments were made directly from the manufacturer to defendants' construction site on December 12, 2005 and February 24, 2006. However, defendants requested a delay in the shipment of some doors because units were not selling as quickly as expected. North American stored those doors in a warehouse in West Chester, Pennsylvania until defendants were ready to receive them, and they were shipped on March 6, 2006.

Defendants made additional installment payments of $24,298.74 on February 21, 2005, and $45,876.81 on April 10, 2006. No additional payments were made, leaving a balance due of $59,808.74.

The doors were installed in defendants' project. The condominium units in which they were installed each sold for approximately $2 million.

North American filed the Pennsylvania action seeking damages for the unpaid balance on the contract. Defendants acknowledged that they were properly served with process. Although they initially requested an extension of time to respond, they chose not to respond in Pennsylvania. Default judgment was then entered in Pennsylvania and docketed on December 5, 2007 in the New Jersey Superior Court pursuant to the Uniform Enforcement of Foreign Judgments Act, N.J.S.A. 2A:49A-25 to -33. As required by the Act, the clerk immediately notified defendants of the docketed judgment. On December 13, 2007, defendants filed a motion objecting to and seeking vacation of the judgment based on Pennsylvania's lack of personal jurisdiction. On January 2, 2008, a writ of execution was issued, reflecting a total judgment amount at that time of $81,667.84.*fn2

In support of its motion, defendants filed a certification of an employee setting forth factual information and attaching documentation regarding the transaction between the parties. North American filed a responding certification of its president, together with attached documentation. The ...

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