Appeal by defendant from order filed 2 May 2002 by Judge Mark
E. Powell in Henderson County District Court. Heard in the Court
of Appeals 23 April 2003.
Frank B. Jackson and James L. Palmer, and Henderson County
Legal Department, by Charles Russell Burrell, for plaintiff
appellee.
Elkins & Elkins, by H. Trade Elkins, for defendant appellant.
BRYANT, Judge.
Manfred Lang (defendant) appeals an order filed 2 May 2002
denying his motion to dismiss for lack of personal jurisdiction.
(See footnote 1)
On 27 October 2000, Wilma Lang (Lang) and Karin Wilma Lang
(the daughter) (collectively plaintiffs) filed separate motions in
the cause to enforce a foreign support judgment pursuant to theUniform Reciprocal Enforcement of Support Act (URESA). The motions
alleged that Lang and defendant had married in Germany in 1962.
The daughter was born during the marriage, which ended in divorce
in 1974. Defendant and Lang entered into a separation agreement
whereby defendant was to pay spousal and child support. This
agreement was incorporated into the German divorce decree.
Sometime thereafter, defendant moved to Henderson County, North
Carolina. Because defendant failed to meet his support obligations
under the agreement, Lang filed a “Notice of Registration of
Foreign Support Order” with the district court in Henderson County,
on 23 June 1992. On 18 August 1994, the daughter filed her own
notice of registration. The notices of registration listed a Flat
Rock, North Carolina mailing address for defendant. Defendant
objected to the registration of the German support judgment and
ultimately appealed the issue, resulting in this Court's affirmance
of the trial court's confirmation of the registration. See Lang v.
Lang, 125 N.C. App. 573, 481 S.E.2d 380 (1997).
In a motion to dismiss dated 7 February 2002, defendant argued
the trial court lacked personal jurisdiction to hear plaintiffs'
motions in the cause to enforce the existing support judgment
because defendant was never a resident or citizen of the State of
North Carolina and did not have sufficient contacts with the State
to warrant the exercise of personal jurisdiction. The trial court
entered an order on 2 May 2002 finding in pertinent part that:
1. These cases began as registrations by
. . . [p]laintiffs of support orders entered
in Germany. The notices of registration were
served on . . . [d]efendant when he waspresent in North Carolina. The registrations
were confirmed, and the confirmation was
upheld by the North Carolina Court of Appeals.
2. On October 27, 2000 . . . [p]laintiffs
filed a verified “Motion to Enforce Judgment”
in these two cases. This motion was
personally served on . . . [d]efendant in
Florida. . . . Defendant's counsel filed a
notice of special limited appearance to
contest personal jurisdiction.
. . . .
3. . . . Defendant has engaged in the
following activity in the State of North
Carolina or related to the State of North
Carolina:
a) He executed on July 26, 1999 a power
of attorney appointing Don H. Elkins as his
attorney-in-fact. This document was filed in
the Office of the Henderson County Register of
Deeds the same day.
b) In the lawsuit Kutz v. Lang, 99-CVS-53
(Henderson County), [defendant] admitted in
his answer filed in April of 1999 that he was
a resident of Henderson County, North
Carolina, and the [trial] [c]ourt finds that
he was in fact such a resident at the time of
the filing of the answer.
c) During a deposition in the case of
Kutz v. Lang on February 7, 2000, . . .
[d]efendant stated that “we have a personal
residence in Kenmure,” a Henderson County,
North Carolina subdivision, and that he had
investments in building sites in two Henderson
County subdivisions. He further stated that
“within the last ten, twelve years we sold
about 100, 110 lots in three different
subdivisions” and used one subdivision
clubhouse as a sales office. The actions of
. . . [d]efendant as stated by him are found
as fact.
d) During the same deposition, . . .
[d]efendant stated that he owned the Middleton
Place subdivision in Henderson County, North
Carolina for ten years and was in the
subdivision “hundreds of times.” He further
admitted showing homes in the subdivision and
taking back mortgages to assist with the
financing. The deposition of . . .[d]efendant further shows that . . .
[d]efendant has recently been extensively
involved with investing in and selling real
estate in Henderson County, North Carolina.
The actions of . . . [d]efendant as stated by
him in the deposition are found as fact.
e) . . . Defendant was issued a North
Carolina operator's license in September 1987.
This license was renewed in January of 1991.
The Division of Motor Vehicles driving history
of . . . [d]efendant dated February 20, 2001
lists . . . [d]efendant's address as being in
Flat Rock, North Carolina. . . . Defendant
and his wife purchased an automobile in North
Carolina in 1993 and registered it in North
Carolina.
f) . . . Defendant signed, as a seller,
offers to purchase and contract for real
property located in North Carolina as late as
November of 2000.
g) . . . Defendant, signed (or his
attorney-in-fact signed on his behalf) many
warranty deeds as grantor, conveying property
located in Henderson County, North Carolina,
the most recent being in November of 2001.
. . . .
i) . . . Defendant reserved certain
repurchase rights for himself as shown in the
“Amendment to Declaration of Restrictive
Covenants for Wildwood Heights Subdivision,”
filed October 21, 1987 in the Henderson County
Register of Deeds. . . . Defendant's home in
Kenmure was sold in August of 2000.
Based on these findings, the trial court concluded that
defendant engaged in substantial activity within the State and
“that this activity allows the State of North Carolina to assert
general personal jurisdiction over . . . [d]efendant pursuant to
N.C.G.S. [§] 1-75.4(1)d.” The trial court further concluded that
defendant “purposefully established and maintained such contacts
with the State of North Carolina such that he should reasonably
anticipate being haled into court in North Carolina.” Because the
assertion of personal jurisdiction over defendant did not offendtraditional notions of fair play and substantial justice, the trial
court denied defendant's motion to dismiss.
_____________________________
The issues are whether: (I) the trial court erred in making
finding of fact number 1 because it was prejudicial and irrelevant
to the determination of personal jurisdiction; (II) the trial court
erred in relying on activities by defendant that pre-dated the
service of process of plaintiffs' motions in the cause; and (III)
defendant's activities in North Carolina were “substantial” and
“continuous and systematic.”
(See footnote 2)
I
Defendant first argues the trial court erred in making the
following finding:
1. These cases began as registrations by
. . . [p]laintiffs of support orders entered
in Germany. The notices of registration were
served on . . . [d]efendant when he was
present in North Carolina. The registrations
were confirmed, and the confirmation was
upheld by the North Carolina Court of Appeals.
Defendant contends that this finding was not only irrelevant but
prejudicial because, based on
Pinner v. Pinner, no jurisdictional
claim or finding may be founded upon the existence of a priorregistered order.
See Pinner v. Pinner, 33 N.C. App. 204, 207-08,
234 S.E.2d 633, 636 (1977). While defendant properly cites this
Court's holding in
Pinner, we conclude that his argument is without
merit for the following reason. The trial court's finding served
an introductory function, providing information on the procedural
background of the case. It did not serve as a basis for the
exercise of personal jurisdiction. Instead, all relevant factors
supporting the trial court's conclusion of personal jurisdiction
were specifically listed in finding of fact number 3. This
assignment of error is therefore overruled.
II
Defendant next contends the trial court erred in relying on
activities that pre-dated the service of process of plaintiffs'
motions in the cause.
When addressing a question of personal
jurisdiction the court engages in a two-step
inquiry. First, the court must determine
whether the applicable long-arm statute
permits the exercise of jurisdiction over the
defendant. Next, the court determines whether
the exercise of jurisdiction comports with due
process under the Fourteenth Amendment.
North Carolina's long-arm statute, N.C.
Gen. Stat. § 1-75.4, was enacted “to make
available to the North Carolina courts the
full jurisdictional powers permissible under
federal due process.” Since the North
Carolina legislature designed the long-arm
statute to extend personal jurisdiction to the
limits permitted by due process, the two-step
inquiry merges into one question: whether the
exercise of jurisdiction comports with due
process.
Regent Lighting Corp. v. Galaxy Elec. Mfg., Inc., 933 F. Supp. 507,
509-10 (1996) (citations omitted). In other words, “there mustexist 'certain minimum contacts [between the non-resident defendant
and the forum] such that the maintenance of the suit does not
offend “traditional notions of fair play and substantial
justice.”'”
Tom Togs, Inc. v. Ben Elias Indus. Corp., 318 N.C.
361, 365, 348 S.E.2d 782, 786 (1986) (citations omitted). This
requirement is satisfied if “a party who when service of process is
made . . . [i]s engaged in substantial activity within this State.”
N.C.G.S. § 1-75.4(1)d (2001). The defendant must be considered to
have “purposefully avail[ed] himself of the privilege of conducting
activities within the forum state, thus invoking the benefits and
protections of its laws” and creating a “reasonabl[e] anticipat[ion
of] being haled into court there.”
Tom Togs, 318 N.C. at 365, 348
S.E.2d at 786. Moreover, “in cases such as the one before us,
where defendant's contacts with the state are not related to the
suit, an application of the doctrine of 'general jurisdiction' is
appropriate.”
Bruggeman v. Meditrust Acquisition Co., 138 N.C.
App. 612, 617, 532 S.E.2d 215, 219 (2000). Under this doctrine,
“jurisdiction may be asserted even if the cause of action is
unrelated to [the] defendant's activities in the forum as long as
there are sufficient 'continuous and systematic' contacts between
[the] defendant and the forum state.”
Fraser v. Littlejohn, 96
N.C. App. 377, 383, 386 S.E.2d 230, 234 (1989).
Defendant contends that the majority of his activities found
as fact by the trial court occurred prior to the time he was served
with process and can therefore not be considered under section 1-
75.4(1)d to determine whether there was substantial activity withthe State. We disagree. The long-arm statute requires a defendant
to be “engaged in substantial activity” in the State “when service
of process is made.” N.C.G.S. § 1-75.4(1)d. Being engaged
connotes already existing or ongoing activity. Furthermore, our
courts have consistently looked to a defendant's conduct prior to
service of process to find the existence of minimum contacts.
See
First Union Nat'l Bank of Del. v. Bankers Wholesale Mortgage, LLC,
153 N.C. App. 248, 570 S.E.2d 217 (2002);
Strother v. Strother, 120
N.C. App. 393, 462 S.E.2d 542 (1995).
Thus, the trial court
properly considered defendant's activity prior to the service of
process for purposes of determining whether defendant was engaged
in substantial activity within the State.
III
Defendant further argues that his activities in North
Carolina, as found by the trial court, were neither substantial nor
continuous and systematic because “property ownership alone is
insufficient to allow a non-resident to be subject to the personal
jurisdiction of the courts of this State.”
Bruggeman, 138 N.C.
App. at 616, 532 S.E.2d at 218. We note, however, that defendant's
contact with this state went beyond simply owning real estate.
See
id. at 618, 532 S.E.2d at 219 (finding minimum contacts of a
continuous and systematic nature where the defendant, “besides
owning real property in North Carolina, [was] engaged in at least
one substantial and ongoing profit-making venture in this State
through the leasing of that property”). Over the course of more
than ten years, including after the motions in the cause werefiled, defendant was engaged in the business of selling real estate
in Henderson County, North Carolina. Defendant “signed, as a
seller, offers to purchase and contract for real property located
in North Carolina as late as November of 2000.” Defendant, or his
attorney-in-fact on his behalf, also signed “many warranty deeds as
grantor, conveying property located in Henderson County, North
Carolina, the most recent being in November of 2001.” This
activity, which the trial court's findings show was systematic and
continuous, is sufficient to support the conclusion that defendant
“purposefully avail[ed] himself of the privilege of conducting
activities within the forum state, thus invoking the benefits and
protections of its laws” and could therefore “reasonably anticipate
being haled into court” in North Carolina.
Tom Togs, 318 N.C. at
365, 348 S.E.2d at 786. Accordingly, the trial court properly
concluded that the exercise of personal jurisdiction complied with
both the long-arm statute and due process.
Affirmed.
Judges TIMMONS-GOODSON and GEER concur.
Footnote: 1