Jurisdiction Crucial in Lawsuit Involving Boat Sale

The plaintiff in Susan Michelle Canon v. Harry B. Towns, et al. recently lost her appeal from a judgment from the Parish of Calcasieu, dismissing her claims against the defendant North Carolina boat sellers in the case for lack of personal jurisdiction. If a court does not have jurisdiction over a party in a case, it will dismiss the claims against that party. Failure to choose the proper court can prevent the success of a valid claim and lead to wasted time and money.

In need of a shrimping vessel to start a business in Louisiana, the plaintiff in the case, Ms. Canon, discovered a boat advertised for sale on the website NoBoatBrokers.com. The listing provided a North Carolina phone number for the sellers, Raeford and Jennifer Millis, which Ms. Canon used to initiate negotiations. These negotiations resulted in Ms. Canon transferring funds from her bank in Louisiana to the seller’s bank in North Carolina to pay for the boat. After traveling to North Carolina to finalize her purchase, Ms. Canon released the uninsured boat to the custody of her Louisiana boat captain and one crew member, both of whom oversaw the boat run aground repeatedly after leaving Sneads Ferry, North Carolina until its ultimate destruction as a result of catching fire in Florida.

The North Carolina boat sellers, the Millises, objected to the Louisiana court’s exercise of personal jurisdiction over them as defendants. In accordance with procedural rules that must be followed in civil law suits, a court must have jurisdiction over the “person” for the court to exert its authority over that defendant. Louisiana refers to its rules of civil procedure as the Code of Civil Procedure (CCP), and courts in the state may refer to prior state and/or federal case law to interpret specific provisions of the Code. Louisiana addresses issues of personal jurisdiction in CCP 6. The only limit on the state’s exercise of personal jurisdiction are those imposed by the due process requirements of the constitution, and in the case of non-resident defendants, there must have been sufficient contact with the state to support that court’s assertion of personal jurisdiction over that defendant. The trial court did not find the Millises’ contacts with Louisiana sufficient to assert jurisdiction over them and dismissed the claims against them.

Ms. Canon appealed the trial court’s dismissal of her claims against the Millises, and the appeals court began their de novo review of the legal question of whether personal jurisdiction over the Millises could be established by a Louisiana court with La R.S. 13:3201, the Louisiana long-arm statute. Louisiana’s long arm statue contains specific acts and conditions that allow the state to exercise of jurisdiction, as well as a provision that authorizes jurisdictional assertion to the full extent allowed by the U.S. Constitution through 13:3201(B) which provides in part “a court of this state may exercise personal jurisdiction over a nonresident on any basis consistent with the constitution of this state and of the Constitution of the United States.”

The court of appeals proceeded to evaluate Louisiana’s authority to assert personal jurisdiction over the defendant boat sellers by considering the Millises’ contacts with Louisiana, and found them insufficient to support the assertion of either specific or general jurisdiction. The court found that the Millises’ acts of providing a North Carolina phone number as contact information in an Internet advertisement listing the boat for sale on a third-party website that was accessible by anyone anywhere with internet access was not directed at Louisiana and did not specifically target consumers in the state. Further, contact with the defendants was initiated by Ms. Canon, and “[e]verything connected to the sale occurred in North Carolina.”

While upholding the trial court’s decision to dismiss Ms. Canon’s claims against the Millises for lack of personal jurisdiction, Ms. Canon is still free to pursue her claims against the Millises in a court that can properly assert personal jurisdiction over the defendants, should she choose to do so.

There are many decisions that, once made can significantly affect the outcome of the case. If you are facing litigation, contact the Berniard Law Firm. Our firm provides expertise in situations where nuanced procedural rules are in play, and offers guidance to avoid procedural missteps.

Call the Berniard Law FirmToll-Free at 1-866-574-8005 and an attorney with expertise in complex litigation matters will be available to assist you.