Appeal by third-party defendant from an order entered 24
August 2004 by Judge Howard E. Manning, Jr. in Wake County Superior
Court. Heard in the Court of Appeals 20 April 2005.
Smyth & Cioffi, L.L.P., by Andrew P. Cioffi, for plaintiff-
Teague, Campbell, Dennis & Gorham, L.L.P., by J. Matthew
Little and Robert M. Tatum, for defendants/third-party
Cranfill, Sumner & Hartzog, L.L.P., by F. Marshall Wall and
Kari R. Johnson, for third-party defendant-appellant.
Third-party defendant, Stahler Furniture Company (Stahler
Furniture), appeals the trial court's order denying its motion to
dismiss for lack of personal jurisdiction. After careful review,
we reverse the order below.
The record tends to indicate the following: Stahler Furniture
is a Vermont corporation located in Lyndonville, Vermont. Timothy
Havey (Havey) and Marilyn Sommers (Sommers) (collectively
plaintiffs) are North Carolina residents. On or about 22 July
2003, plaintiffs visited the Stahler Furniture store in Vermont and
purchased a corner cabinet and an end table. Stahler Furniture
contracted with defendants and third-party plaintiffs, Yellow
Transportation, Inc. (Yellow Transportation), an Indiana
corporation, to transport the furniture to plaintiffs' residence in
North Carolina from Stahler Furniture's business facility in
Specifically, on or about 10 November 2003, Stahler Furniture
contracted with Yellow Transportation to deliver an end table and
corner cabinet to plaintiffs' home in Raleigh, North Carolina.
Defendant Mark Valentine (Valentine) was the truck driver. On 14
November 2003, Valentine arrived at plaintiffs' home. According to
plaintiffs' complaint, as Valentine was unloading a crate
containing a piece of furniture from the tractor-trailer, Valentine
pushed the crate out of the truck in an unsafe and dangerous
manner causing it to fall on and permanently injure Havey. On 12 March 2004, Havey and Sommers filed a complaint against
Valentine and Yellow Transportation alleging negligence.
Defendants answered and filed a third-party complaint against
Stahler Furniture alleging negligence, negligent misrepresentation,
and breach of contract. Stahler Furniture filed a N.C. Gen. Stat.
§ 1A-1, Rule 12(b)(2) motion to dismiss the third-party complaint
for lack of personal jurisdiction. On 24 August 2004, the trial
court denied Stahler Furniture's motion. Stahler Furniture
'The standard of review of an order determining jurisdiction
is whether the findings of fact by the trial court are supported by
competent evidence in the record; if so, this Court must affirm the
order of the trial court.' Tejal Vyas, LLC v. Carriage Park Ltd.
P'ship, 166 N.C. App. 34, 37, 600 S.E.2d 881, 884 (2004) (quoting
Better Business Forms, Inc. v. Davis, 120 N.C. App. 498, 500, 462
S.E.2d 832, 833 (1995)), per curiam affirmed, 359 N.C. 315, 608
S.E.2d 751 (2005). In this case, however, the trial court made no
findings of fact. Where no findings are made, proper findings are
presumed, and our role on appeal is to review the record for
competent evidence to support these presumed findings. Bruggeman
v. Meditrust Acquisition Co., 138 N.C. App. 612, 615, 532 S.E.2d
215, 217-18, appeal dismissed and disc. review denied, 353 N.C.
261, 546 S.E.2d 90 (2000).
Our Supreme Court has held that
a two-step analysis must be employed to
determine whether a non-resident defendant is
subject to the in personam jurisdiction of ourcourts. First, the transaction must fall
within the language of the State's long-arm
statute. Second, the exercise of jurisdiction
must not violate the due process clause of the
fourteenth amendment to the United States
Tom Togs, Inc. v. Ben Elias Industries Corp., 318 N.C. 361, 364,
348 S.E.2d 782, 785 (1986) (citation omitted). For purposes of
this appeal, neither party disputes that North Carolina's long-arm
statute applies to the facts of this case. Thus, our inquiry
focuses upon whether the exercise of personal jurisdiction would
violate the due process clause of the Fourteenth Amendment to the
United States Constitution.
To comply with due process, there must be minimum contacts
between the non-resident defendant and the forum so that allowing
the suit does not offend traditional notions of fair play and
substantial justice. Id. at 365, 348 S.E.2d at 786 (citing
International Shoe Co. v. Washington, 326 U.S. 310, 316, 90 L. Ed.
95, 102 (1945)).
[T]here must be some act by which the
defendant purposefully avails himself of the
privilege of conducting activities within the
forum state, thus invoking the benefits and
protections of its laws; the unilateral
activity within the forum state of others who
claim some relationship with a non-resident
defendant will not suffice.
When a controversy is related to or 'arises out of' a
defendant's contacts with the forum, the [United States Supreme]
Court has said that a 'relationship among the defendant, the forum,
and the litigation' is the essential foundation of in personamjurisdiction. Helicopteros Nacionales de Colombia v. Hall, 466
U.S. 408, 414, 80 L. Ed. 2d 404, 411 (1984) (quoting Shaffer v.
Heitner, 433 U.S. 186, 204, 53 L. Ed. 2d 683[, 698] (1977)). This
type of personal jurisdiction has been characterized as specific
jurisdiction. Id. at 414 n.8, 80 L. Ed. 2d at 411 n.8. When the
suit does not arise out of a defendant's activities in the forum
state, personal jurisdiction is present when there are sufficient
contacts between the state and the defendant. Id. at 414, 80 L.
Ed. 2d at 411. This type of personal jurisdiction has been
characterized as general jurisdiction. Id. at 414 n.9, 80 L. Ed.
2d at 411 n.9.
A. Specific Jurisdiction
'Specific jurisdiction exists if the defendant has purposely
directed its activities toward the resident of the forum and the
cause of action relates to such activities.' Wyatt v. Walt Disney
, 151 N.C. App. 158, 165, 565 S.E.2d 705, 710 (2002)
(quoting Frisella v. Transoceanic Cable Ship Co
., 181 F. Supp. 2d
644, 647 (E.D.La. 2002)). To determine whether it may assert
specific jurisdiction over a defendant, the court considers (1)
the extent to which the defendant 'purposefully avail[ed]' itself
of the privilege of conducting activities in the State; (2) whether
the plaintiffs' claims arise out of those activities directed at
the State; and (3) whether the exercise of personal jurisdiction
would be constitutionally 'reasonable.' ALS Scan, Inc. v. Digital
, 293 F.3d 707, 712 (4th Cir. 2002) (citation
omitted), cert. denied
, 537 U.S. 1105, 154 L. Ed. 2d 773 (2003). When specific jurisdiction exists, a defendant has 'fair warning'
that he may be sued in a state for injuries arising from activities
that he 'purposefully directed' toward that state's residents.
Tom Togs, Inc.
, 318 N.C. at 366, 348 S.E.2d at 786.
(1) Purposeful Availment
Purposeful availment is shown if the defendant has taken
deliberate action within the forum state or if he has created
continuing obligations to forum residents. Ballard v. Savage
F.3d 1495, 1498 (9th Cir. 1995). Although contacts that are
isolated or sporadic may support specific jurisdiction if they
create a substantial connection with the forum, the contacts must
be more than random, fortuitous, or attenuated. Burger King Corp.
, 471 U.S. 462, 472-75, 85 L. Ed. 2d 528, 540-42
(1985). Furthermore, it is not required that a defendant be
physically present within the forum, provided its efforts are
purposefully directed toward forum residents. Id.
at 476, 85 L.
Ed. 2d at 543.
The record indicates that Stahler Furniture is a Vermont
corporation with one retail location in Lyndonville, Vermont.
Stahler Furniture is not licensed or registered to do business in
North Carolina. Stahler Furniture neither has any employees in
North Carolina, nor does it have any real or personal property in
this state. Stahler Furniture has not shipped more than one or two
other pieces of furniture to North Carolina in the last ten years.
On or about 22 July 2003, plaintiffs went to Stahler
Furniture's store in Lyndonville, Vermont, and purchased two piecesof furniture. The furniture was completely paid for by plaintiffs
in Vermont on or about 22 July 2003. Stahler Furniture and Yellow
Transportation, an Indiana corporation, entered into a contract for
Yellow Transportation to deliver plaintiffs' furniture to North
Carolina. The contract negotiations and the contract execution
between Stahler Furniture and Yellow Transportation did not occur
in North Carolina. Yellow Transportation picked up the furniture
for delivery in Lyndonville, Vermont. The description and weight
of the property to be delivered were given to Yellow Transportation
by Stahler Furniture in Vermont. While attempting to deliver the
furniture in North Carolina, Valentine, an employee of Yellow
Transportation, dropped a furniture crate onto Havey. No employees
or representatives of Stahler Furniture were present at the scene
of the delivery accident.
Stahler Furniture does not advertise in North Carolina.
However, Stahler Furniture does have an Internet website. Yellow
Transportation argues that because Stahler [Furniture], through
the use of its website and catalog, holds itself out as a seller of
furniture to residents of North Carolina[,] . . . [it has]
deliberately availed itself of the privilege of conducting business
in North Carolina as well as the protection of the laws of North
In ALS Scan, Inc. v. Digital Serv. Consultants, Inc
., 293 F.3d
707, the United States Court of Appeals for the Fourth Circuit
delineated the following rule for determining whether an Internetwebsite can be the basis of an exercise of personal jurisdiction by
[A] State may, consistent with due process,
exercise judicial power over a person outside
of the State when that person (1) directs
electronic activity into the State, (2) with
the manifested intent of engaging in business
or other interactions within the State, and
(3) that activity creates, in a person within
the State, a potential cause of action
cognizable in the State's courts. Under this
standard, a person who simply places
information on the Internet does not subject
himself to jurisdiction in each State into
which the electronic signal is transmitted and
received. Such passive Internet activity does
not generally include directing electronic
activity into the State with the manifested
intent of engaging business or other
interactions in the State thus creating in a
person within the State a potential cause of
action cognizable in courts located in the
. at 714. When a website is neither merely passive nor highly
interactive, the exercise of jurisdiction is determined 'by
examining the level of interactivity and commercial nature of the
exchange of information that occurs.' Carefirst of Maryland v.
Carefirst Pregnancy Ctrs.
, 334 F.3d 390, 400 (4th Cir. 2003)
(quoting Zippo Manufacturing Co. v. Zippo Dot Com, Inc
., 952 F.
Supp. 1119, 1126 (W.D.Pa. 1997)).
Stahler Furniture's website is an informational, passive
website. The website provides a history of the store and its
owner, a brief description of the type of furniture made by the
company (i.e., types of wood), and the number of employees. The
website also lists its address, phone number, and an electronic
mail address through which a person could request a catalog. Thewebsite allows viewers to view samples, and states that Stahler
Furniture will deliver within seventy-five miles of the store and
will ship furniture throughout the United States. However, viewers
cannot purchase furniture via the website and the website does not
actively target North Carolina customers.
As the website in this case does not specifically target North
Carolina residents, does not allow viewers to purchase furniture
directly from the website, and merely provides information to the
viewer, we conclude the website is passive and does not, by itself,
provide a basis for an exercise of personal jurisdiction by North
Carolina courts. Similarly, because (1) all of the contract
negotiations occurred outside of North Carolina, and (2) Stahler
Furniture does not have any significant contacts with North
Carolina, we conclude Stahler Furniture has not purposefully
availed itself of the privilege of conducting activities in this
(2) Do plaintiffs' claims arise out of activities directed at
Yellow Transportation has alleged Stahler Furniture breached
its duty to provide Yellow Transportation with the correct weight
of the furniture, and therefore, Yellow Transportation brought a
negligence claim against Stahler Furniture. [A] court may
exercise specific personal jurisdiction over a nonresident
defendant acting outside of the forum when the defendant has
intentionally directed his tortious conduct toward the forum state,
knowing that that conduct would cause harm to a forum resident. Carefirst
, 334 F.3d at 397-98 (footnote omitted). However, as
explained by the United States Court of Appeals for the Fourth
Circuit, a single shipment of goods to a state may not be the basis
for personal jurisdiction if the exercise of personal jurisdiction
would not be fair, reasonable, and would not comport with the
traditional notions of fair play and substantial justice. See
Chung v. NANA Development Corp.
, 783 F.2d 1124, 1126-27 (4th Cir.),
, 479 U.S. 948, 93 L. Ed. 2d 381 (1986). Moreover,
[i]t is essential that the contract relied upon have a
'substantial connection' with the forum state. Id
. at 1128. The
significant contacts considered are those actually generated by the
. at 1127.
In this case, the North Carolina residents visited the Stahler
Furniture store in Vermont and purchased furniture. As a result of
this purchase, Stahler Furniture shipped the furniture to
plaintiffs' residence in North Carolina. All of the negotiations
for the purchase of the furniture and its shipment occurred in
Vermont. Moreover, Havey and Sommers initiated contact with
Stahler Furniture. Nonetheless, Yellow Transportation contends
Stahler Furniture was negligent because it failed to provide them
with the correct weight of the furniture, and this failure caused
the truck driver to use an improper unloading technique, which
proximately caused Havey's injuries when the furniture fell on
Havey. While Stahler Furniture did make the shipping arrangements
to have the furniture shipped to North Carolina, an analysis of the
entire transaction between Havey, Sommers, Stahler Furniture, andYellow Transportation does not reveal a substantial connection to
the State of North Carolina.
(3) Would an exercise of personal jurisdiction be
[T]he fundamental requirement of personal jurisdiction [is]:
'deliberate action' within the forum state in the form of
transactions between the defendant and residents of the forum or
conduct of the defendant purposefully directed at residents of the
forum state. Millennium Enterprises v. Millennium Music, LP
F. Supp. 2d 907, 921 (D.Or. 1999).
In conducting this inquiry, we direct our
focus to the quality and nature of [the
nonresident's] contacts. We should not
merely . . . count the contacts and
quantitatively compare this case to other
preceding cases. . . .
To decide whether the requisites of
specific jurisdiction are satisfied in this
case, it is necessary to consider how they
apply to the particular circumstance in which,
as here, an out-of-state defendant has acted
outside of the forum in a manner that injures
someone residing in the forum.
, 334 F.3d at 397 (citations omitted) (quoting Nichols v.
G.D. Searle & Co.
, 783 F. Supp. 233, 238 (D.Md. 1992)).
Although Havey was injured in North Carolina and the furniture
was shipped to North Carolina, the key facts surrounding Yellow
Transportation's third-party complaint against Stahler Furniture
occurred in Vermont. Moreover, plaintiffs went to Vermont to
purchase the furniture. Through the purchase of furniture in
Vermont, Stahler Furniture became contractually obligated to shipthe furniture to North Carolina. Furthermore, Stahler Furniture
has had essentially no contact with the State of North Carolina
over the past ten years. And, as previously discussed, a passive
Internet website cannot provide the basis for an exercise of
personal jurisdiction. Considering the quantity and quality of
Stahler Furniture's contacts with the State of North Carolina, we
hold that specific personal jurisdiction does not exist in this
B. General personal jurisdiction
The test for general jurisdiction is more stringent,
must be 'continuous and systematic contacts between [the]
defendant and the forum state.' Bruggeman
, 138 N.C. App. at 617,
532 S.E.2d at 219 (citations omitted).
The existence of minimum contacts cannot be
ascertained by mechanical rules, but rather by
consideration of the facts of each case in
light of traditional notions of fair play and
justice. The factors to be considered are (1)
quantity of the contacts, (2) nature and
quality of the contacts, (3) the source and
connection of the cause of action to the
contacts, (4) the interest of the forum state,
and (5) convenience to the parties.
Marion v. Long
, 72 N.C. App. 585, 587, 325 S.E.2d 300, 302 (1985)
It is unnecessary to review each of these factors individually
as we have already explained that Stahler Furniture does not have
minimum contacts with the State of North Carolina. Over the past
ten years, Stahler Furniture has sold one or two pieces of
furniture to North Carolina residents. It is not registered orlicensed to do business in North Carolina. Stahler Furniture does
not own any real or personal property located in this state.
Stahler Furniture does not advertise here and it has a passive,
informational website that anyone in the United States may access.
Stahler Furniture did not solicit any customers in North Carolina;
rather, the North Carolina plaintiffs in this case went to the
Stahler Furniture store in Vermont and purchased the furniture.
Accordingly, we conclude general personal jurisdiction does not
exist in this case.
In sum, we conclude the trial court erroneously denied Stahler
Furniture's Rule 12(b)(2) motion to dismiss for lack of personal
jurisdiction. As we have explained, neither specific personal
jurisdiction nor general personal jurisdiction exists in this case.
Indeed, the significant facts in this case arose in Vermont and
Stahler Furniture does not have continuous and systematic contact
with the State of North Carolina. As stated in Chung
the defendant's conduct and connection with
the forum State [must be] . . . such that he
should reasonably anticipate being haled into
court there. . . .
The focus on a defendant's own acts
serves the underlying due process objective of
fair notice, giving a degree of
predictability to the legal system that allows
potential defendants to structure their
primary conduct with some minimum assurance as
to where that conduct will and will not render
them liable to suit.
, 783 F.2d at 1127 (citations omitted) (quoting World-Wide
, 444 U.S. 286, 297, 62 L. Ed. 2d 490[,
501] (1980)). Accordingly, we reverse the decision below. Reversed.
Judges HUDSON and GEER concur.
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