Mann v. High Country Meats, Inc. , 125 Idaho 357 ( 1994 )

TROUT, Justice.

PARTIES

M & M Feedlot is owned and operated by Kent and Charles Mann (Mann), in Parma, Idaho. High Country Meats, Inc. (High Country) is a Utah corporation whose president is Wells Cannon (Cannon) and whose shareholders are Cannon and defendant Richard A. Coonrod (Coonrod). Coonrod is a resident of . Edina, Minnesota.

BACKGROUND

High Country entered into a contract with M & M Feedlot for the purchase of sixty-two veal calves which High Country was to pick up at the M & M Feedlot in Parma, Idaho. Pursuant to their agreement Mann released four of the calves to High Country. Because High Country was slow in making payment for those calves, Mann wanted payment guaranteed before the remaining calves would be released. Thereafter, Cannon initiated a three-way conference call from Utah between Kent Mann in Parma, Idaho and Coonrod in Edina, Minnesota. Mann asserted that during the telephone conversation Coonrod indicated that he would personally guarantee payment for any additional calves sold to High Country. Mann alleged that as a result of the conversation, he released the additional calves. While High Country did make payment on the sale of the calves in the amount of $9,000.00, Mann asserted that the sum of $19,846.00 plus interest was still due and owing on the sale.

Mann filed suit against High Country and Coonrod, individually, on February 22, 1991. On September 18, 1991, Coonrod filed a motion to dismiss alleging that the district court lacked personal jurisdiction over him. Kent Mann submitted his affidavit regarding the sale of calves to High Country, his beliefs regarding Coonrod’s business involvement with High Country, and his version of the three-way conversation in which he contends payment was guaranteed by Coonrod. Coon-rod submitted his affidavit directly contradicting Kent Mann’s statements about Coon-rod’s business involvement and any alleged guarantee.

On December 4, 1991, the district court entered an order denying Coonrod’s motion to dismiss based on lack of personal jurisdiction. After the order denying the motion to dismiss was entered, Coonrod and High Country filed an answer to Mann’s complaint on January 15, 1992, continuing to deny any jurisdiction over them and asserting that to the extent there was any guarantee, it violated the statute of frauds. A trial was held on June 19,1992. At trial the attorney for High Country and Coonrod argued to the court that M & M Feedlot should not be able to recover on the alleged guarantee by Coon-rod, based upon the statute of frauds. The court found High Country liable for the unpaid balance on the contract and took under advisement the argument presented by Coonrod regarding the statute of frauds. In a supplemental order dated August 18, 1992, the court ruled that Coonrod was estopped from asserting the defense of the statute of frauds. Thereafter judgment was entered for Mann against High Country and Coon-rod, jointly and severally, for the total sum, including interest and attorney fees, of $26,-438.76. Coonrod filed a notice of appeal on October 13, 1992; High Country has not appealed from the entry of judgment against it.

The following issues were raised on appeal: 1) Whether the district court erred in exercising personal jurisdiction over Coonrod under the Idaho long-arm statute and under the Due Process Clause of the United States Constitution; and 2) whether the district court erred in ruling that Coonrod was es-topped from raising the statute of frauds as a defense.

STANDARD OF REVIEW

Idaho Appellate Rule 17(e)(1)(A) provides that a final judgment appealed from is deemed to include “[a]ll interlocutory judgments, orders and decrees entered prior to the judgment, order or decree appealed from, ...” Thus this Court can review all orders entered by the district court prior to entry of the final judgment which involve issues on appeal. We therefore consider first the district court’s order denying Coon-rod’s motion to dismiss based upon lack of personal jurisdiction and the affidavits filed in opposition to and in support thereof.

When reviewing an appeal" from motions to dismiss based on lack of personal jurisdiction, we apply the same standard as when we review appeals from orders of summary judgment; We construe the evidence presented to the district court in favor of the party opposing the order and accord that party the benefit of all inferences which might be reasonably drawn. Houghland Farms, Inc. v. Johnson, 119 Idaho 72, 74-75, 803 P.2d 978, 980-81 (1990) (citing Intermountain Business Forms, Inc. v. Shepard Business Forms Co., 96 Idaho 538, 540, 531 P.2d 1183, 1185 (1975)). Thus in reviewing the district court’s ruling on the motion to dismiss we construe the evidence in favor of Mann.

THERE WERE INSUFFICIENT FACTS ASSERTED FOR THE DISTRICT COURT TO EXERCISE PERSONAL JURISDICTION OVER COONROD UNDER THE LONG-ARM STATUTE.

After construing the evidence most favorably for Mann, the district court ruled that it had personal jurisdiction over Coonrod based upon allegations that Coonrod did guarantee the sales contract; that the contract was entered into over the telephone with an Idaho participant; and that the guarantee was of a sales contract to be performed in Idaho. We disagree with the court’s conclusion.

In order for a court properly to exercise jurisdiction over an individual who is not subject to the “general” jurisdiction of the courts of the state of Idaho, there must be a legal basis for the assertion of extraterritorial jurisdiction. Houghland Farms, 119 Idaho at 75, 803 P.2d at 981. I.C. § 5-514 provides the basis needed for the courts of Idaho to assert extraterritorial jurisdiction over an individual or business. Saint Alphonsus v. Washington, 123 Idaho 739, 743, 852 P.2d 491, 495 (1993). “In order for an Idaho court to exert jurisdiction over an out-of-state defendant ... the act[s] giving rise to the cause must fall within the scope of our long-arm statute----” Saint Alphonsus, 123 Idaho at 742, 852 P.2d at 494. Mann has asserted that the Idaho courts have jurisdiction over Coonrod under one provision of Idaho’s long-arm statute: I.C. § 5-514(a). Thus on appeal we are concerned only with whether there was sufficient evidence to support a conclusion that Coonrod transacted business within the state of Idaho so as to subject him to the jurisdiction of the district court.

I.C. § 5-514(a) provides in pertinent part as follows:

Any person, firm, company, association or corporation, whether or not a citizen or resident of this state, who in person or through an agent does any of the acts hereinafter enumerated, thereby submits said person, firm, company, association or corporation, and if any individual, his personal representative, to the jurisdiction of the courts of this state as to any cause of action arising from the doing of any of said acts;

(a) The transaction of any business within this state which is hereby defined as the doing of any act for the purpose of realizing pecuniary benefit or accomplishing or attempting to accomplish, transact or enhance business purpose or objective or any part thereof of such person, firm, company, association or corporation; ....

For the purpose of the motion to dismiss it is important to note that Coonrod is being sued individually and thus we must examine his activities independently of those of High Country to determine if he was personally transacting business within Idaho for the purposes of the long-arm statute. While his acts may have been done to benefit the business in which he has an interest, it is nevertheless his actions with which we are concerned and not those of High Country.

Based upon the affidavits presented on the motion to dismiss we cannot say Coon-rod transacted business within the state of Idaho within the meaning of the long-arm statute. The facts as alleged in Kent Mann’s affidavit demonstrate only that Cannon and Coonrod were in daily contact regarding the operation of High Country; that Coonrod was involved in the financial decisions of High Country; .and that Coonrod stated during a telephone call to him in Minnesota, which was initiated by Cannon in Utah, that he would guarantee payment for the calves. Therefore, the only actions alleged by Mann that would indicate Coonrod transacted business in Idaho are the telephone call and the fact that Mann is located in Idaho. We cannot say Coonrod transacted business in Idaho based upon a telephone call which he did not even initiate. Likewise, we cannot say Coonrod transacted business in Idaho due to the mere fact that Mann is located in Idaho. Nowhere do we find allegations supporting an inference that Coonrod was acting “for the purpose of realizing pecuniary benefit” or that he was “attempting to accomplish, transact or enhance” his own business purposes. Based upon the record before us there is simply no evidence that Coonrod entered into a transaction of business within the state of Idaho. These facts were not a sufficient basis upon which the district court could assert jurisdiction.

Because we hold that Coonrod did not transact business within Idaho so as to come within the scope of the Idaho long-arm statute, there is no need to discuss whether the exercise of jurisdiction would comply with the mandates of the United States Constitution.

Likewise, based upon our holding that Coonrod is not subject to the jurisdiction of the district court, there is no need for us to address whether the doctrine of equitable estoppel properly barred Coonrod from raising the defense of the statute of frauds.

CONCLUSION

We hold that the district court erred in concluding it could properly exercise personal jurisdiction over Coonrod and we, therefore, reverse the denial of the motion to dismiss. Because the district court should not have exercised jurisdiction over Coonrod, the district court’s judgment finding Coonrod jointly and severally liable under the sales contract is vacated and the case is remanded for entry of judgment against High Country alone. Costs but no fees awarded to appellant.

McDEVITT, C.J., and JOHNSON and SILAK, JJ., concur.