Cannon and Associates, LLC v. Hillcrest Healthcare, LLC ( 2019 )

04/29/2019
IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
March 5, 2019 Session
CANNON AND ASSOCIATES, LLC v. HILLCREST HEALTHCARE, LLC
Appeal from the Chancery Court for Davidson County
No. 17-1010-III Ellen H. Lyle, Chancellor
___________________________________
No. M2018-00929-COA-R3-CV
___________________________________
This case involves the enrollment of a foreign judgment in Tennessee. The trial court
granted summary judgment in favor of the plaintiff, effectively enrolling the foreign
judgment, rendered in Florida, pursuant to the Full Faith and Credit Clause of the United
States Constitution and Tennessee’s Uniform Foreign Judgment Enforcement Act. On
appeal, the defendant argues that the granting of summary judgment was improper
because the Florida court lacked personal jurisdiction over defendant. Because we
conclude that genuine issues of material fact remain unresolved, the trial court’s order
granting summary judgment in favor of the plaintiff is vacated and remanded for further
proceedings.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Vacated
and Remanded
J. STEVEN STAFFORD, P.J., W.S., delivered the opinion of the court, in which ARNOLD B.
GOLDIN, and KENNY ARMSTRONG, JJ., joined.
W.H. Stephenson, II, Nashville, Tennessee, for the appellant, Hillcrest Healthcare, LLC
d/b/a Hillcrest Healthcare Center.
Philip L. Robertson and Brittany M. Bartkowiak, Franklin, Tennessee, for the appellee,
Cannon and Associates, LLC d/b/a Polaris Group.
OPINION
Background
I.
Hillcrest Healthcare, LLC (“Hillcrest” or “Appellant”) is a healthcare facility that
was organized in 1995 and is located in Ashland City, Tennessee. In 2010, Hillcrest
entered into a management agreement with Beacon-Ashland City, LLC (“Beacon”)
wherein Beacon assumed all of the day-to-day responsibilities of running the facility. The
agreement indicated that Beacon was an independent contractor of Hillcrest, and that
Beacon would have “ultimate control and decision-making authority over the assets and
operation of the facility during the [m]anagement [t]erm.” At all times relevant to this
appeal, J. David Hightower (“Mr. Hightower”) has been the registered agent for service
of process for Hillcrest with the Tennessee Secretary of State.1
On April 15, 2015, Beacon entered into a series of contracts for collection
services2 with Cannon and Associates, LLC d/b/a/ Polaris Group (“Polaris” or
“Appellee”), a company organized under the laws of Florida and located in Tampa,
Florida. Although the contract between Beacon and Polaris indicated that Polaris’s
services would be “provided both onsite and offsite as needed[,]” the contract did not
indicate whether Polaris’s services would be rendered in Florida or if employees of
Polaris would travel to Tennessee to assist Beacon. The contract did, however, provide
that Beacon would bear the cost of any travel required by Polaris personnel. Moreover,
this contract provided that the agreement of the parties “shall be governed by the laws of
the State of Florida.” Marcella Bryant was the Beacon administrator who signed the
April 15, 2015 contract with Polaris. Then, on June 15, 2015, another nearly identical
contract was entered into by Beacon and Polaris. This second contract contained largely
the same provisions as the April contract, except that this contract inexplicably provided
that it would be governed by the laws of the State of Arkansas. Further, this second
contract between Beacon and Polaris was signed by a different Beacon administrator,
Hughes Ash.
Shortly after Beacon entered into the two contracts for collection services with
Polaris, Beacon’s relationship with Hillcrest deteriorated. As such, Hillcrest terminated
its management contract with Beacon in August of 2015.3
II.
1
Mr. Hightower’s exact role at Hillcrest is not entirely clear from the record; his affidavit states
that he is the “lawful owner and officer” of Hillcrest, and that he has “full authority” to act on Hillcrest’s
behalf. It is unclear whether there are other owners and officers at Hillcrest or if Mr. Hightower is the sole
owner.
2
Specifically, Polaris contracted to “provide [the] facility with Accounts Receivable Assistance”
and Medicare and Medicaid billing support.
3
The record does not indicate what became of Beacon after the contract between Hillcrest and
Beacon was terminated; in any event, Beacon was never made a party to these proceedings and does not
participate in the present appeal.
-2-
After the contract between Hillcrest and Beacon was terminated, Polaris filed suit
against Hillcrest in the Thirteenth Judicial District for Hillsborough County, Florida (“the
Florida court”). The complaint alleged that Hillcrest was responsible for the balance
owing on the contract between Beacon and Polaris. An affidavit of service was filed with
the Florida court on March 10, 2016, indicating that the complaint and summons had
been served on Hillcrest on February 29, 2016, at its business address in Ashland City,
Tennessee. The affidavit of service further indicated that the documents were left with
“Jennifer Ambrosch, a person authorized to accept service.”4 Hillcrest never responded to
the complaint in the Florida court and, as such, a default judgment was entered against
Hillcrest on or about June 17, 2017, in the amount of $17,953.15.
III.
Following the Florida court’s entry of the default judgment against Hillcrest,
Polaris sought to have the judgment enrolled in Tennessee by filing a verified petition to
enroll the Florida judgment on September 18, 2017, in the Chancery Court for Davidson
County Tennessee (“the trial court”). An authenticated copy of the default judgment was
attached to the verified petition. Hillcrest filed a response, asserting that the Florida
judgment was not entitled to full faith and credit in Tennessee. In support, Hillcrest
argued that it had never had any contact with the State of Florida and that the default
judgment was rendered without proper service of process. Simply put, Hillcrest disputed
that it was ever subject to personal jurisdiction in the Florida court.
On February 1, 2018, Polaris filed a motion for summary judgment to enroll the
judgment. Therein, Polaris asserted that Hillcrest could provide no evidence to support a
defense to the proposed enrollment of the Florida judgment and that Hillcrest’s attacks on
the foreign judgment were barred by the doctrine of res judicata. Polaris asserted that
Hillcrest could not assert a personal jurisdiction defense because “lack of jurisdiction is a
defense that must be raised in a responsive pleading or by motion[,] otherwise it is
waived.” Moreover, with regard to Hillcrest’s argument that it never received service of
process, Polaris argued that Hillcrest was properly served on February 29, 2016, when the
complaint and summons was left with Jennifer Ambrosch at the Hillcrest facility.
Moreover, Polaris included a sworn affidavit of its president and CEO, Charles Cave,
wherein Mr. Cave asserted that Hillcrest and Polaris were parties to an agreement and
that Polaris had served Hillcrest with a copy of the complaint and summons at the
Hillcrest facility in Ashland City, Tennessee. Accordingly, Polaris asserted that the
Florida judgment was entitled to full faith and credit as a matter of law, and that Hillcrest
could not provide any evidence to the contrary. To that end, Polaris’s statement of
undisputed facts averred that “Hillcrest cannot bring forth the evidence to support any of
its alleged affirmative defenses.”
4
Neither party has ever clarified who Ms. Ambrosch is, what role she played at Hillcrest, or why
she is purported to have been authorized to accept service on behalf of Hillcrest.
-3-
Hillcrest responded to this motion by again raising the issues of personal
jurisdiction and insufficient service of process and disputing the assertion that Hillcrest
lacked evidence to support its personal jurisdiction argument. Hillcrest attached to its
response the sworn affidavit of Mr. Hightower, in which Mr. Hightower stated that he
was the lawful agent for service of process for Hillcrest and that he was never served with
the complaint and summons issued by the Florida court. Further, Mr. Hightower stated in
his affidavit that Hillcrest never engaged in any business with Polaris or the State of
Florida. With regard to the contract entered into by Beacon and Polaris, Mr. Hightower
asserted that Hillcrest was not a party to this contract and that Beacon, at all relevant
times, acted as an independent contractor rather than an agent of Hillcrest. Hillcrest also
submitted a sworn affidavit from Marcella Bryant, the Beacon administrator whose
signature appears on the April 2015 contract between Polaris and Beacon. Ms. Bryant
stated that she entered into the agreement with Polaris not at the behest of Mr. Hightower
or Hillcrest, but rather under the direction of other Beacon administrators. Ms. Bryant
also stated that it was her understanding that neither Mr. Hightower nor any other officers
of Hillcrest were ever apprised of the contracts between Beacon and Polaris.
Accordingly, Hillcrest’s proffered statements of undisputed material facts averred that
Polaris could offer no proof that Hillcrest or Mr. Hightower ever engaged in contact with
the State of Florida sufficient for Florida to exercise personal jurisdiction over Hillcrest.
Hillcrest also disputed that Hillcrest was properly served with the original complaint and
summons.
The trial court held a hearing on Polaris’s motion for summary judgment on April
6, 2018. On April 20, 2018, the trial court entered an order in which it concluded that
there were no genuine issues of material fact, and that the Florida judgment was entitled
to full faith and credit in Tennessee. With regard to the issue of personal jurisdiction, the
trial court concluded that the record, without dispute, established that Hillcrest was a
party to the contract with Polaris, and further pointed out that the April 2015 contract
between Beacon and Polaris was controlled by Florida law. As such, the trial court
determined that there was “no issue of fact that the parties agreed to Florida jurisdiction.”
From this order, Hillcrest appeals.
Issue Presented
The single issue presented for review is whether the trial court erred in concluding
that Polaris was entitled to summary judgment on its petition to enroll the Florida
judgment in Tennessee.
Standard of Review
This case was decided on a motion for summary judgment. Summary judgment is
appropriate where: (1) there is no genuine issue with regard to the material facts relevant
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to the claim or defense contained in the motion; and (2) the moving party is entitled to
judgment as a matter of law on the undisputed facts. Tenn. R. Civ. P. 56.04. “[W]hen the
moving party does not bear the burden of proof at trial, the moving party may satisfy its
burden of production either (1) by affirmatively negating an essential element of the
nonmoving party’s claim or (2) by demonstrating that the nonmoving party’s evidence at
the summary judgment stage is insufficient to establish the nonmoving party’s claim or
defense.” Rye v. Women’s Care Ctr. of Memphis, MPLLC, 477 S.W.3d 235, 264 (Tenn.
2015).
On appeal, this Court reviews a trial court’s grant of summary judgment de
novo with no presumption of correctness. Rye, 477 S.W.3d at 250 (citing Bain v. Wells,
936 S.W.2d 618, 622 (Tenn. 1997)). In reviewing the trial court’s decision, we must view
all of the evidence in the light most favorable to the nonmoving party and resolve all
factual inferences in the nonmoving party’s favor. Luther v. Compton, 5 S.W.3d 635,
639 (Tenn. 1999); Muhlheim v. Knox Cnty. Bd. of Educ., 2 S.W.3d 927, 929 (Tenn.
1999). If the undisputed facts support only one conclusion, then the court’s summary
judgment will be upheld because the moving party was entitled to judgment as a matter
of law. See White v. Lawrence, 975 S.W.2d 525, 529 (Tenn. 1998); McCall v. Wilder,
913 S.W.2d 150, 153 (Tenn. 1995).
Finally, whether to grant full faith and credit to a foreign judgment is a question of
law, and therefore, we review the decision de novo upon the record with no presumption
or correctness for the trial court’s conclusions of law. Minor Miracle Prods., LLC v.
Starkey, No. M2011-00072-COA-R3-CV, 2012 WL 112593, at *4 (Tenn. Ct. App. Jan.
12, 2012); W & T, Inc. v. Ham, No. M2006-01617-COA-R3-CV, 2009 WL 225256, at
*3 (Tenn. Ct. App. Jan. 29, 2009).
Discussion
I.
The present case turns on whether the trial court correctly concluded that the
Florida judgment against Hillcrest should be given full faith and credit in Tennessee. The
Full Faith and Credit Clause of the United States Constitution provides: “Full Faith and
Credit shall be given in each state to the public Acts, Records, and judicial Proceedings
of every other State.” U.S. Const. art. IV, § 1. It is well-settled that the Full Faith and
Credit Clause of the United States Constitution requires the judgment of a state court,
having both personal and subject matter jurisdiction, be given the “same credit, validity
and effect in the courts of every other state and that such judgment be equally conclusive
upon the merits in the courts of the enforcing states.” Mirage Casino Hotel v. J. Roger
Pearsall, No. 02A01-9608-CV-00198, 1997 WL 275589, at *3 (Tenn. Ct. App. May 27,
1997). The Full Faith and Credit Clause manifests an important federal policy, one that
makes the states “integral parts of a single nation throughout which a remedy upon a just
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obligation might be demanded as of right, irrespective of the state of its
origin.” Milwaukee Cnty. v. M.E. White Co., 296 U.S. 268, 277, 56 S. Ct. 229, 80 L.Ed.
220 (1935).
Tennessee’s adoption of the Uniform Enforcement of Foreign Judgments Act
(“UEFJA”) provides a mechanism for a party to enroll a judgment from a sister state. See
Tenn. Code Ann. §§ 26-6-101 to -108. The UEFJA provides, in relevant part, as follows:
(a) A copy of any foreign judgment authenticated in accordance with the
acts of congress or the statutes of this state may be filed in the office of the
clerk of any circuit or chancery court of this state.
(b) The clerk shall treat the foreign judgment in the same manner as a
judgment of a court of record of this state.
(c) A judgment so filed has the same effect and is subject to the same
procedures, defenses and proceedings for reopening, vacating, or staying as
a judgment of a court of record in this state and may be enforced or
satisfied in like manner.
Tenn. Code Ann. § 26-6-104. Accordingly, section 26-6-101 et seq. provides a
mechanism by which Tennessee can give full faith and credit to foreign judgments, and
Tennessee courts presume that “absent proper proof to the contrary . . . the decrees of the
courts of record of any sister states are valid.” Four Seasons Gardening & Landscaping,
Inc. v. Crouch, 688 S.W.2d 439, 44142 (Tenn. Ct. App. 1984). Moreover, “[a] party
who seeks to prevent the enrollment of a foreign judgment in Tennessee carries a ‘stern
and heavy’ burden.” Guseinov v. Synergy Ventures, Inc., 467 S.W.3d 920, 925 (Tenn.
Ct. App. 2014) (citing Coastcom, Inc. v. Cruzen, 981 S.W.2d 179 (Tenn. Ct. App. 1998);
Dement v. Kitts, 777 S.W.2d 33, 36 (Tenn. Ct. App. 1989)).
Nonetheless, a party may collaterally attack the validity of foreign judgment under
certain circumstances; indeed, despite the strong policy underpinning the Full Faith and
Credit Clause, three recognized exceptions to the enrollment of a foreign judgment
exist. Mirage Casino-Hotel, 1997 WL 275589 at *4. Specifically, a Tennessee court may
decline to accord full faith and credit to the judgment of another state if the judgment is:
(1) void due to lack of personal or subject matter jurisdiction; (2) based upon fraud; or (3)
where enforcement of the judgment would violate the public policy of the forum state. Id.Tennessee courts have recognized and embraced all three of these exceptions. See,
e.g., BancorpSouth Bank v. Johnson, No. W2012-00452-COA-R3-CV, 2013 WL
3770856 (Tenn. Ct. App. July 16, 2013) (citing Trustmark Nat’l Bank v. Miller, 209
S.W.3d 54, 57 (Tenn. Ct. App. 2006)) (recognizing the fraud exception); Four
Seasons, 688 S.W.2d at 445 (recognizing the personal jurisdiction and public policy
exceptions).
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Consequently, it has long been held in Tennessee that “[i]f the court rendering the
judgment lacked personal jurisdiction over the parties, the judgment is void and not
entitled to full faith and credit in this state.” Pearl Equip., LLC v. Cartwright Const. Co.,
No. M2008-01109-COA-R3-CV, 2010 WL 3463201, at *2 (Tenn. Ct. App. Sept. 2,
2010) (citing Tareco Props., Inc. v. Morriss, No. M2002-02950-COA-R3-CV, 2004 WL
2636705, at *9 (Tenn. Ct. App. Nov. 18, 2004)); see also Frazier v. Frazier, 72 S.W.3d
333, 335 (Tenn. Ct. App. 2001) (“Two limited exceptions to the full faith and credit
principle are where it can be shown that the rendering court lacked personal or subject
matter jurisdiction.”); Biogen Distrib., Inc. v. Tanner, 842 S.W.2d 253, 256 (Tenn. Ct.
App. 1992) (“The two most common circumstances when courts will refuse to give full
faith and credit to a foreign judgment are when the court entering the foreign judgment
had no personal or subject matter jurisdiction.”); Four Seasons, 688 S.W.2d at 442(“Although final judgments entered by courts of other states are ordinarily
conclusive, Article 4, Section 1 of the United States Constitution does not compel other
states to grant these judgments full faith and credit when it is shown that the court
entering the judgment did not have personal jurisdiction over the party against whom the
judgment is sought to be enforced.”).
In the present case, Hillcrest argues on appeal that one of the enumerated
exceptions to full faith and credit, lack of personal jurisdiction, applies to the Florida
judgment at issue. Hillcrest’s argument is two-fold. First, Hillcrest urges that it was never
a party to the contract between Polaris and Beacon, and that at the time Beacon entered
the contract, it was operating merely as an independent contractor that remained liable for
its own debts. As such, Hillcrest asserts that it has never had sufficient, if any, contact
with the State of Florida such that it was appropriate for the Florida court to exercise
personal jurisdiction over Hillcrest. Second, Hillcrest asserts that the service of process
related to the original lawsuit was improper; specifically, Hillcrest avers that Mr.
Hightower has always been the registered agent for Hillcrest and that Mr. Hightower
never received notice of the Florida lawsuit. In support, Hillcrest notes that service of
process was made on someone named Jennifer Ambrosch, and that it is entirely unclear
from the record who Ms. Ambrosch is or why Polaris believed that she could accept
service for Hillcrest.
On balance, Polaris argues that Hillcrest has not put forth sufficient evidence to
rebut the presumption that the Florida judgment is valid and enforceable. With regard to
Hillcrest’s argument that the Florida court lacked personal jurisdiction, Polaris simply
asserts that “[l]ack of jurisdiction was waived by the failure to raise that defense in the
underlying litigation.” Polaris further points out that “Hillcrest failed to file any
responsive pleadings or motions. . . . [t]hus, the present argument that the Florida [c]ourt
lacked jurisdiction has been waived and is barred by res judicata.” Polaris also argues that
even if personal jurisdiction were not waived, Hillcrest’s actions through Beacon would
be sufficient minimum contacts for Florida to acquire personal jurisdiction over Hillcrest.
In support, Polaris urges that the place of performance and payment of the contract
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between Beacon and Polaris was Florida, and that the contract provided that it would be
controlled by Florida law.5 Finally, Polaris argues that service of process was proper
under Florida law, because service was delivered to Hillcrest’s business address pursuant
to its registration with the Tennessee Secretary of State. Polaris’s overall contention on
appeal is that there are no genuine issues of material fact that remain in dispute and that
Hillcrest’s personal jurisdiction argument is meritless.
II.
We begin with Polaris’s threshold arguments concerning waiver and res judicata.
Both arguments lack merit. First, Polaris maintains that Hillcrest is barred from raising
the issue of personal jurisdiction because it should have been raised in the Florida court.
Respectfully, this is an inaccurate statement of the law. The Full Faith and Credit Clause
“does not compel other states to grant [foreign] judgments full faith and credit when it is
shown that the court entering the judgment did not have personal jurisdiction over the
party against whom the judgment is sought to be enforced.” Four Seasons, 688 S.W.2d
at 442. Despite Polaris’s argument, challenging the personal jurisdiction of the forum that
rendered the judgment is a proper way to challenge the enrollment of a foreign judgment
in Tennessee. Pearl Equipment, 2010 WL at *2 (citing Howard Johnson, Inc. v.
Holyfield, No. W2008-02405-COA-R3-CV, 2009 WL 1349197, at *2 (Tenn. Ct. App.
May 14, 2009)) (“[A]n enrolled foreign judgment, treated in the same manner as a
judgment of a court of record of this state, and subject to the same defenses, may be
attacked on the grounds found in Tennessee Rule of Civil Procedure 60.02. . . .
[b]ecause Rule 60.02(3) permits a court to set aside a judgment if that judgment is void,
Tennessee courts will commonly refuse to give full faith and credit to a foreign judgment
where the court entering the foreign judgment had no personal jurisdiction.”); Tareco
Props., Inc. v. Morriss, No. M2002-02950-COA-R3-CV, 2004 WL 2636707, at *9
(Tenn. Ct. App. Nov. 18, 2004) (noting that if the court rendering the judgment lacked
personal jurisdiction over the parties, the judgment is void and not entitled to full faith
and credit in this state.) Moreover, it is undisputed here that Hillcrest never made a
general appearance in the Florida court such that personal jurisdiction was waived. See
generally Caldwell v. Caldwell, 921 So. 2d 759, 760 (Fla. Dist. Ct. App. 2006) (“By
entering a general appearance without contesting personal jurisdiction, [defendant]
waived this defense.”); Dixie Sav. Stores, Inc. v. Turner, 767 S.W.2d 408, 410 (Tenn.
Ct. App. 1988) (“Thus, if a party makes a general appearance and does not take issue
with venue, adequacy of service of process, personal jurisdiction, or other similar matters,
the courts customarily find that the party has waived its objections to these matters.”).
5
Inexplicably, Polaris does not address the fact that the record contains two different contracts
between Beacon and Polaris and that the second contract provides that it is controlled by Arkansas law.
As such, Polaris appears to suggest that the first contract between Beacon and Polaris is the controlling
contract, but offers no support or legal authority for this position.
-8-
We are likewise unconvinced by Polaris’s argument that Hillcrest is barred from
raising the issue of personal jurisdiction by the doctrine of res judicata. In its brief,
Polaris urges that “a default judgment is a final adjudication on the merits and has res
judicata effect” and that as such, Hillcrest’s “affirmative defenses and the assertions of
fact to support them became immaterial upon entry of the Foreign Judgment.” Again, this
argument reveals a misunderstanding of the applicable law. It is well-settled that a “party
asserting a defense predicated on res judicata or claim preclusion must demonstrate[,]”
inter alia, “that the underlying judgment was rendered by a court of competent
jurisdiction.” Jackson v. Smith 387 S.W.3d 486, 492 (Tenn. 2012). See also Collins v.
Sams East, Inc., No. W2017-00711-COA-R3-CV, 2018 WL 1299857, at *7 (Tenn. Ct.
App. Mar. 13, 2018) (“The doctrine of res judicata cannot be invoked unless all its
essential elements are present, and each necessary element must be established beyond all
question.”). As discussed at length supra, Hillcrest’s central contention is that the Florida
court lacked personal jurisdiction to enter the judgment against it. If Hillcrest prevails on
this claim, the foreign judgment simply cannot have preclusive effect. As such, Hillcrest
is not barred from raising this defense in order to avoid enrollment of the foreign
judgment.
III.
Because attacking the original court’s personal jurisdiction is a proper way to
challenge the enrollment of a foreign judgment, we perceive the dispositive issue to be
whether the Florida court acquired personal jurisdiction over Hillcrest such that the
default judgment was valid. If the Florida court lacked personal jurisdiction, Tennessee is
not compelled to enforce the Florida judgment with full faith and credit, and summary
judgment in favor of Polaris was inappropriate. See Four Seasons, 688 S.W.2d at 442.
As such, a review of the law on personal jurisdiction is in order.
Tennessee law makes clear that in addressing this issue, we look to Florida’s
statutes “and the cases construing it” to render our decision. Id. at 442 (“The courts of
this State must look to the jurisdictional statutes of the state in which the judgment sought
to be enforced was entered when determining whether that court had obtained personal
jurisdiction over the non-resident defendant.”) (citing Diners Club, Inc. v. Makoujy, 110
Misc.2d 870, 443 N.Y.S.2d 116, 118 (1981); McGinnis v. McGinnis, 44 N.C. App. 381,
261 S.E.2d 491, 496 (1980)); see also Pearl Equipment, 2010 WL 3463201, at *3
(“[W]hen a foreign judgment is attacked here, the focus should be on what effect the
attack would have in the forum that rendered the judgment. . . . when the rendering
court’s jurisdiction over the parties is attacked, we must look to the law of the jurisdiction
where the judgment was entered.”); Biogen Distrib., 842 S.W.2d at 256 (“Parties seeking
to undermine the validity of a foreign judgment . . . must demonstrate that the foreign
court did not acquire jurisdiction under the law of the state where the judgment was
obtained.”); Frazier, 72 S.W.3d at 336 (“To mount a successful collateral attack upon [a]
final decree of divorce entered in Illinois, it must be shown that Illinois lacked
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jurisdiction, as determined by Illinois law.”). Thus, in the present case, “our inquiry
should be limited to [Florida’s] long arm statute and the cases construing it to determine
whether [the Florida court] had properly acquired personal jurisdiction” over Hillcrest at
the time the default judgment was entered. Four Seasons, 688 S.W.2d at 442.
IV.
Like Tennessee and other states, the Florida legislature has enacted a long-arm
statute providing for personal jurisdiction over out-of-state residents. See generally Fla.
Stat. Ann. § 48.193. Through this enactment, Florida’s “legislature has determined the
requisite basis for obtaining [personal] jurisdiction over nonresident defendants as far as
Florida is concerned.” Venetian Salami Co. v. Parthenais, 554 So.2d 499, 500 (Fla.
1989). A nonresident defendant must fall within the ambit of at least one subsection of
section 48.193 before a Florida court may exercise personal jurisdiction over that party.
Id. Relevant to this case, section 48.193 provides that
A person, whether or not a citizen or resident of this state, who personally
or through an agent does any of the acts enumerated in this subsection
thereby submits himself or herself and, if he or she is a natural person, his
or her personal representative to the jurisdiction of the courts of this state
for any cause of action arising from any of the following acts:
* * *
7. Breaching a contract in this state by failing to perform acts required by
the contract to be performed in this state.
Fla. Stat. Ann. § 48.193(1)(a). In addition to compliance with the long-arm statute, “in
cases involving jurisdiction over nonresidents, there are constitutional issues which [the
Florida courts] must also consider.” Venetian Salami, 554 So.2d at 502 (citing Osborn v.
University Society, Inc., 378 So.2d 873, 874 (Fla. Dist. Ct. App. 1979)). Specifically, in
addition to satisfying the long-arm statute, a party must have had sufficient minimum
contacts with the State of Florida in order for Florida to acquire personal jurisdiction:
Long ago, the United States Supreme Court in International Shoe
Co. v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945), held
that in order to subject a defendant to an in personam judgment when he is
not present within the territory of the forum, due process requires that the
defendant have certain minimum contacts with the forum such that
the maintenance of the suit does not offend traditional notions of fair play
and substantial justice. More recently, the same Court stated that the test is
whether the defendant’s conduct in connection with the forum state is “such
that he should reasonably anticipate being haled into court there.” World-
- 10 -
Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S. Ct. 559, 62
L.Ed.2d 490 (1980).
Id. at 500. Accordingly, Florida law mandates a two-part inquiry “in determining whether
long-arm jurisdiction is appropriate in a given case[.]” Id. (citing Unger v. Publisher
Entry Serv., Inc., 513 So.2d 674, 675 (Fla. Dist. Ct. App. 1987)). “First, it must be
determined that the complaint alleges sufficient jurisdictional facts to bring the action
within the ambit of the [long-arm] statute[.]” Id. Next, the court must conclude that
“sufficient minimum contacts are demonstrated to satisfy due process requirements.” Id.To satisfy the second prong of this analysis, a party’s contact with the State of
Florida must (1) relate to the plaintiff’s cause of action or have given rise to it; (2)
involve some act by which the defendant has purposefully availed itself of the privileges
of conducting activities within the state; and (3) the contact with the forum must be such
that the defendant should reasonably anticipate being haled into court there. Moro
Aircraft Leasing, Inc. v. Int’l Aviation Mktg., Inc., 206 So.3d 814, 817 (Fla. Dist. Ct.
App. 2016) (citing Corporacion Aero Angeles, S.A. v. Fernandez, 69 So.3d 295, 299
(Fla. Dist. Ct. App. 2011)).
Importantly, the Florida Supreme Court has rejected “talismanic jurisdictional
formulas” in determining whether a party’s relationship to Florida satisfies the minimum
contacts requirement. Venetian Salami, 554 So.2d at 502. Instead, “the facts of each case
must always be weighed in determining whether personal jurisdiction would comport
with ‘fair play and substantial justice.’” Id. (quoting Kulko v. California Superior Court,
436 U.S. 84. 92, 98 S. Ct. 1690, 169697 (1978)). As such, “under a given factual
situation, even though a nonresident may appear to fall within the wording of a long arm
statute, a plaintiff may not constitutionally apply the statute to obtain jurisdiction in the
absence of the requisite minimum contacts with the forum state.” Id.Moreover, the Florida Supreme Court has expounded on the framework that courts
should follow when a nonresident defendant attacks the court’s personal jurisdiction, and
the facts alleged by the parties are in direct conflict. In Venetian Salami, the Florida
plaintiff sought to have the Florida trial court exert personal jurisdiction over a Canadian
company based on the allegation that the parties had entered into a contract, and the
defendant failed to tender payment. 554 So.2d at 500. After the defendant was served, it
moved to quash service of process based upon lack of personal jurisdiction. Id. at 500.
Both parties filed sworn affidavits supporting their positions; specifically, the defendant
filed an affidavit from its president, wherein the president asserted that the defendant was
a Canadian corporation that conducted no business in Florida, and further asserted that
the defendant “never reached any agreement with the [the plaintiff], much less an
agreement to pay any money in Florida.” Id. at 503. The trial court dismissed the suit
based on lack of personal jurisdiction; however, the First District Court of Appeals
reversed, finding that “jurisdiction over [the defendant] had been obtained because the
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complaint alleged facts sufficient to fall within the scope of section 48.193(1)(g) and that
when these allegations were challenged, they were backed by affidavit.” Id. at 500.
On appeal, the Florida Supreme Court determined that the lower court of appeals
erred in concluding that personal jurisdiction existed where both parties had filed sworn
affidavits addressing the underlying facts regarding personal jurisdiction, and those facts
were irreconcilable. In so holding, the supreme court highlighted the problem created by
such a situation:
Initially, the plaintiff may seek to obtain jurisdiction over a nonresident
defendant by pleading the basis for service in the language of the statute
without pleading the supporting facts. Fla. R. Civ P. 1.070(i); Jones v. Jack
Maxton Chevrolet, Inc., 484 So.2d 43 (Fla. 1st DCA 1986). By itself, the
filing of a motion to dismiss on grounds of lack of jurisdiction over the
person does nothing more than raise the legal sufficiency of the
pleadings. Elmex Corp. v. Atlantic Fed. Savings & Loan Ass’n, 325 So.2d
58 (Fla.4th DCA 1976). A defendant wishing to contest the allegations of
the complaint concerning jurisdiction or to raise a contention of
minimum contacts must file affidavits in support of his position. The
burden is then placed upon the plaintiff to prove by affidavit the basis
upon which jurisdiction may be obtained. Elmex Corp. In most cases, the
affidavits can be harmonized, and the court will be in a position to make a
decision based upon facts which are essentially undisputed. However, the
question remains with respect to what should be done if the relevant facts
set forth in the respective affidavits are in direct conflict. There is no
Florida decision on this question, and the instant case highlights the
dilemma.
Id. at 50203 (emphasis added). In that case, the facts in the parties’ sworn affidavits
could not be reconciled; indeed, the court stated that “the facts set forth in [the plaintiff’s]
affidavits would be sufficient to establish [defendant’s] minimum contacts with the
state[,]” but also that the “[defendant] denies that the parties reached any agreement
whatsoever.” Id. Further, the court noted that “the mere failure to pay money in Florida,
standing alone[,]” likely would not “suffice to obtain jurisdiction over a nonresident
defendant.” Id. at 503. Consequently, the Venetian Salami court reversed and remanded
the case back to the trial court so that an evidentiary hearing could be held, and a decision
regarding personal jurisdiction reached. The ultimate conclusion of the court was that
where facts underpinning the assertion of long-arm jurisdiction are disputed, the court
must hold a limited evidentiary hearing in order to determine whether jurisdiction exists.
The analysis applied by the Venetian Salami court has been reiterated many
times, and it is now well-settled in Florida that where a defendant files an affidavit that
“fully disputes the jurisdictional allegations in the complaint, the burden shifts back to the
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[plaintiff] to prove by affidavit or other sworn proof that a basis for long-arm jurisdiction
exists.” Teva Pharmaceutical Indus. v. Ruiz, 181 So.3d 513, 519 (Fla. Dist. Ct. App.
2015). In Teva, for example, the plaintiff alleged that the defendant pharmaceutical
company produced a contaminated drug that was used on the plaintiff during surgery,
resulting in permanent injury. Id. at 517. The complaint alleged that Teva
Pharmaceuticals USA was a wholly owned subsidiary of Teva Industries, and that Teva
USA manufactured, distributed, and sold the drug at issue. Id. As such, the complaint
averred that Teva Industries was responsible for any torts committed by Teva USA. Id.In response, Teva Industries filed a motion to dismiss wherein it alleged that it was an
Israeli company that exercised no control over Teva USA’s manufacturing operations,
and had no contact with the State of Florida. Id. The trial court denied the motion to
dismiss, which Teva Industries then appealed. Id.On appeal, the Second District Court of Appeals acknowledged that the plaintiff
had satisfied his initial pleading requirement, and that “the burden then shifted to Teva
Industries to file a legally sufficient affidavit or other sworn proof [contesting] the
essential jurisdictional facts” of the complaint. Id. at 518. However, the court then
explained that Teva Industries satisfied this burden when it submitted the affidavit of its
vice president of finance to rebut the allegation that it was subject to Florida’s
jurisdiction. Id. Specifically, this affidavit averred that Teva Industries “conducts no
business and has no connection to either Florida or this litigation.” Id.Based on this affidavit, the appellate court concluded that Teva Industries had
successfully shifted the burden of establishing personal jurisdiction back to the plaintiff.
Id. at 519. Because the plaintiff then responded to the allegations in the affidavit, the
court ultimately decided that there was a conflict in the evidence and that the trial court
should have held a hearing to resolve the disputed issues of facts. Id. at 520. Notably, the
Teva court pointed out that “an evidentiary hearing under Venetian Salami resolves the
factual disputes necessary to determine jurisdiction pursuant to section 48.193 as well as
whether minimum contacts exists to satisfy due process concerns.” Id. at 521.
The pertinent take-away from Venetian Salami and Teva is that once a
nonresident defendant puts forth sworn proof rebutting the allegation that personal
jurisdiction exists, the burden of establishing personal jurisdiction shifts back to the
plaintiff. Moreover, these cases demonstrate that it is inappropriate for a trial court to
leave factual conflicts regarding personal jurisdiction unresolved. As stated supra, this
procedure is well-settled practice in Florida. See, e.g., County of Cumberland v. Kwap,
220 So.3d 1207 (Fla. Dist. Ct. App. 2017) (trial court erred in failing to consider the
conflicting evidence on personal jurisdiction where New Jersey defendant submitted
sworn affidavit that the tort at issue was committed by an independent contractor of the
defendant, rather than the defendant itself); S. Wall Prod., Inc. v. Bolin, 251 So.3d 935(Fla. Dist. Ct. App. 2018) (noting that where a plaintiff sufficiently alleges basis for long-
arm jurisdiction, the burden shifts to the defendant to contest those allegations; if
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adequately contested by affidavit or other proof, the burden then shifts back to the
plaintiff to refute the evidence the defendant submitted by affidavit or other evidence);
Packaging & Distrib. Res., LLC v. Duke Realty Ltd., 194 So.3d 509 (Fla. Dist. Ct. App.
2016) (“In most instances, the evidence presented by each side can be harmonized, and
the trial court is in a position to make a determination based upon undisputed facts.
However, if the evidence presented by the parties conflicts, the trial court must then hold
a limited evidentiary hearing to resolve the jurisdictional issue.”).6
Of course, Tennessee applies its own procedural law, including its summary
judgment standard. Hamer v. Se. Res. Grp., Inc., No. M2015-00643-COA-R3-CV, 2016
WL 853020, at *4 (Tenn. Ct. App. Mar. 3, 2016) (citing Beach Cmty. Bank v. Labry,
No. W2011-01583-COA-R3-CV, 2012 WL 2196174, at *3 n.6 (Tenn. Ct. App. June 15,
2012)) (“Because Tennessee is the forum state for this case, the procedural law of
Tennessee, including its summary judgment standard, applies.”). Although the ultimate
burden is on Hillcrest to avoid the foreign judgment, see Guseinov, 467 S.W.3d at 925,
because Polaris chose to file a summary judgment motion, we discern no palpable
difference between the burden-shifting framework encompassed by Florida law and the
Tennessee law applicable in this case.
For example, Tennessee’s summary judgment standard also contains a burden-
shifting analysis in this context. As explained by the Tennessee Supreme Court,
[w]hen the moving party does not bear the burden of proof at trial, the
moving party may satisfy its burden of production either (1) by
affirmatively negating an essential element of the nonmoving party’s claim
or (2) by demonstrating that the nonmoving party’s evidence at the
summary judgment stage is insufficient to establish the nonmoving party’s
claim or defense.
Rye v. Women’s Care Center of Memphis, MPLLC, 477 S.W.3d 235, 265 (Tenn. 2015).
It is then incumbent upon the nonmoving party to “respond, and by affidavits or one of
6
We must acknowledge that the Florida cases cited herein generally deal with motions to dismiss,
rather than motions for summary judgment. Nonetheless, we discern no error in relying on these cases, as
Tennessee law makes clear that both a motion to dismiss and a motion for summary judgment are
intended to resolve issues of law. See Timmons v. Lindsey, 310 S.W.3d 834, 83839 (Tenn. Ct. App.
2009) (noting that whether to dismiss a cause of action for failure to state a claim for which relief can be
granted is a question of law); Ray v. Neff, No. M2016-02217-COA-R3-CV, 2018 WL 3493158, at *3
(Tenn. Ct. App. July 20, 2018) (“Summary judgment is appropriate when . . . there is no genuine issue as
to any material fact and that the moving party is entitled to judgment as a matter of law”). See also Tenn.
R. Civ. P. 56.04. Moreover, the Florida courts’ focus on the existence of disputed material facts
concerning personal jurisdiction dovetails with Tennessee’s summary judgment standard. Compare
Venetian Salami, 554 So.2d at 50003, and Teva Industries, 181 So.3d at 519, with Rye, 477 S.W.3d at
26465.
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the other means provided in Tennessee Rule 56, set forth specific facts at the summary
judgment stage showing that there is a genuine issue for trial.” Id. at 264. Under Rye,
when the nonmoving party raises a defense based on specific facts, the burden then shifts
back to the moving party show they are entitled to judgment as a matter of law. See
Steele v. Primehealth Medical Center, P.C., No. W2015-00056-COA-R3-CV, WL
9311846, at *4 (Tenn. Ct. App. Dec. 22, 2015) (noting that summary judgment should
only be granted if the “nonmoving party’s evidence at the summary judgment stage is
insufficient to establish the existence of a genuine issue of material fact for trial.”).
A similar framework applies to challenges to personal jurisdiction, even when
raised in the context of a motion to dismiss. Indeed, Tennessee law makes clear that
where a defendant properly raises the issue of lack of personal jurisdiction, i.e., by filing
affidavits and other evidence, the ultimate burden shifts to the plaintiff to show personal
jurisdiction. See Gordon v. Greenview Hosp. Inc., 300 S.W.2d 635, 643 (Tenn. 2009)
(noting that the plaintiff bears the ultimate burden of demonstrating that the trial court
may exercise personal jurisdiction over the defendant, although “[t]he burden is not
ordinarily a heavy one.”); see also First Cmty. Bank., N.A. v. First Tennessee Bank,
N.A., 489 S.W.3d 369, 382 (Tenn. 2015) (same); Humphreys v. Selvey, 154 S.W.3d 544,
548 (Tenn. Ct. App. 2004) (“The plaintiff has the burden of establishing a prima
facie case that personal jurisdiction over a defendant is proper.”). Where a defendant
submits affidavits in support of an attack on personal jurisdiction, “the plaintiff must
establish its prima facie showing of personal jurisdiction over the defendant by filing its
own affidavits or other written evidence.” Gordon, 300 S.W.3d at 644; see also
Humphreys, 154 S.W.3d at 548 (“When a defendant files a motion to dismiss
challenging the trial court’s personal jurisdiction over him, the plaintiff must set out
specific facts which demonstrate that the court has jurisdiction.”). Accordingly,
Tennessee’s procedure dealing with a direct attack on a court’s personal jurisdiction
dovetails with Florida procedure under Venetian Salami.
Here, there can be no dispute that Hillcrest filed not one, but two, sworn affidavits
contesting the facts underpinning Florida’s personal jurisdiction over Hillcrest. These
affidavits, if taken as true, show that Hillcrest’s only contact with Florida occurred via
Beacon, Hillcrest’s independent contractor. By submitting these affidavits, Hillcrest
complied with Florida law by “fully disput[ing] the jurisdictional allegations in the
complaint[.]” Teva, 181 So.3d at 518. Moreover, Hillcrest complied with its
responsibility under Tennessee summary judgment law to put forth evidence raising
genuine issues of material fact. Rye, 477 S.W.3d at 264; see also Gordon, 300 S.W.3d at
644 (holding that when a defendant files affidavits sufficiently attacking personal
jurisdiction, the burden is on the plaintiff to establish proper jurisdiction). As such, we
conclude that Hillcrest has followed the proper procedure for attacking the personal
jurisdiction of the Florida court, pursuant to both Florida and Tennessee law, such that
the burden shifted to Polaris to demonstrate in the trial court that it was entitled to
judgment as a matter of law, i.e., that Florida had personal jurisdiction over Hillcrest.
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Going forward, we must consider whether Polaris met this burden by showing undisputed
material facts sufficient to establish that the Florida court had personal jurisdiction over
Hillcrest in this case. If Polaris cannot meet this burden, the outcome is not that Hillcrest
definitively satisfied its “stern and heavy burden” in preventing the enrollment of a
foreign judgment, but simply that summary judgment was inappropriate at this juncture.
Four Seasons, 688 S.W.2d at 442.
V.
Consequently, we proceed to consider whether the trial court was correct in
granting summary judgment to Polaris. In its final order, the trial court stated that there
were “no genuine issues of material fact[,]” and that “there is no issue of fact that the
parties agreed to Florida jurisdiction.” In determining whether the trial court erred in its
finding, we look to Florida caselaw considering personal jurisdiction over a non-resident
defendant in similar circumstances. In these cases, Florida courts have generally held that
the exercise of personal jurisdiction is highly dependent upon the facts of a given case,
and have many times addressed the scenario in which a nonresident defendant is accused
of breaching a contract with a Florida company, as is the case in the present appeal. See
Fla. Stat. Ann. § 48.193 (a)(7) (“A person, whether or not a citizen or resident of this
state . . . submits himself or herself . . . to the jurisdiction of the courts of this state for . . .
[b]reaching a contract in this state by failing to perform acts required by the contract to be
performed in this state.”).
As an initial matter, it is well-settled in Florida that “[t]he due process requirement
of minimum contacts is not satisfied by a showing that a party has entered into a contract
with a non-resident, or a showing that payment must be made in Florida.” Bohlander v.
Robert Dean & Assocs. Yacht Brokerage, Inc., 920 So.2d 1226, 1228 (Fla. Dist. Ct.
App. 2006) (citing Venetian, 554 So.2d at 502; Group One Enters., Inc. v. Publishers’
Representative, Inc., 899 So.2d 402 (Fla. Dist. Ct. App. 2005); Hartcourt Cos., Inc. v.
Hogue, 817 So.2d 1067 (Fla. Dist. Ct. App. 2002); deMco Techs., Inc. v. C.S.
Engineered Castings, Inc., 769 So.2d 1128 (Fla. Dist. Ct. App. 2000)). On the other
hand, however, “when a non-resident defendant enter[s] into a contract with a Florida
party for substantial services to be performed in Florida[,] . . . the defendant has
purposely availed himself of the privilege of conducting activities in Florida.”
Bohlander, 920 So.2d at 1228 (citing Smith Architectural Grp., Inc. v. Dehaan, 867
So.2d 434 (Fla. Dist. Ct. App. 2004)) (emphasis added). Accordingly, Florida caselaw
reflects that whether a party has sufficient minimum contacts with the state is highly
dependent on the facts of the particular case, and in order to establish that Florida has
personal jurisdiction over an out of state defendant the Florida plaintiff must show
something beyond having merely entered into a contract with a nonresident defendant.
See Woodard Chevrolet, Inc. v. Taylor Corp., 949 So.2d 268, 270 (Fla. Dist. Ct. App.
2007) (holding that California defendant lacked sufficient minimum contacts with Florida
where defendant contracted with a Florida company to design, produce, and print
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advertising brochures for the California defendant and mail the brochures from Florida);
Moro Aircraft Leasing, 206 So.3d at 818 (concluding that minimum contacts was not
satisfied where marketing agreement between Alaska corporation and Florida corporation
never required substantial services to be performed in Florida, and in fact did not specify
where the marketing services would take place); Fernandez, 69 So.3d at 29697
(determining that Florida lacked personal jurisdiction over Mexican company in breach
of contract action where the Florida broker advertised defendant’s airplane in national
magazines, and the sale of the airplane closed in Canada).
Keeping in mind the foregoing, we cannot agree with the trial court that no issues
of material fact remain outstanding in this case; on the contrary, the evidence presented
by the parties leaves more questions unresolved than answered. While the nature of
Hillcrest’s contact with the State of Florida is an essential inquiry in determining whether
the Florida court had personal jurisdiction over Hillcrest, the record is replete with
disputes as to this question.
First, the original breach of contract suit against Hillcrest is based entirely on the
contracts entered into by Beacon and Polaris. While Polaris asserts that Beacon was
acting as an agent for Hillcrest when Beacon signed the contracts, Hillcrest has offered
evidence that Beacon was, at all times, an independent contractor of Hillcrest and that
Hillcrest never had knowledge of the contracts. The nature of the contracting party as an
independent contractor is an important consideration in determining whether the facts
show sufficient contacts to exert personal jurisdiction, as this goes to whether the
defendant itself had sufficient minimum contacts with the forum state. See County of
Cumberland v. Kwap, 220 So.3d 1207 (Fla. Dist. Ct. App. 2017) (holding that the trial
court erred in failing to consider the conflicting evidence on personal jurisdiction where
New Jersey defendant submitted sworn affidavit that the tort at issue was committed by
an independent contractor of the defendant, rather than the defendant itself). To the extent
that Hillcrest’s only connection with the State of Florida was indirect contact through its
relationship with Beacon, this tends to undercut Polaris’s assertion that Florida acquired
personal jurisdiction over Hillcrest. If “[t]he due process requirement of minimum
contacts is not satisfied by a showing that a party has entered into a contract with a non-
resident[,]” Bohlander, 920 So.2d at 1228, the record here is even less convincing where
there is a dispute as to whether Hillcrest was even a party to the contract with a Florida
entity at all. Indeed, the management contract between Beacon and Hillcrest is contained
in the record, and reflects that Beacon was an independent contractor with its own
authority to contract with third parties. Further, the affidavit of Beacon administrator
Marcella Bryant supports Hillcrest’s assertion that no officers or owners of Hillcrest ever
knew about the contract with Polaris. As such, these facts, taken as true, tend to dispute
Polaris’s assertion of minimum contacts.
Second, it is entirely unclear from the record where the services provided for in
the Polaris contracts were to be performed, despite the importance of this inquiry in a
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minimum contacts analysis. See Ganiko v. Ganiko, 826 So.2d 391, 395 (Fla. Dist. Ct.
App. 2002) (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 105 S.Ct. 2174(1985)) (“Simply contracting with a nonresident is not enough to subject that nonresident
to personal jurisdiction.”); QSR, Inc. v. Concord Food Festival, Inc., 766 So.2d 271, 275
(Fla. Dist. Ct. App. 2000) (“[I]t is . . . not enough to satisfy due process concerns that
payment is to be made in the forum states . . . [r]ather, in assessing the sufficiency of the
contacts, the courts have looked to the degree of control and interaction that the contract
either contemplates or results in.”); Stomar, Inc. v. Seven Riverboat Co., LLC, 821 So.2d
1183, 1187 (Fla. Dist. Ct. App. 2002) (concluding that nonresident defendant had
sufficient minimum contacts with Florida where contract required “more than mere
obligation to make payment in Florida.”). Hillcrest’s facility is located in Ashland City,
Tennessee, while Polaris is located in Tampa, Florida. The contract, however, provides
that Polaris’s services would be rendered both “onsite and offsite as needed” without
explanation as to whether “site” refers to Florida or Tennessee. Further, there is a
provision in the contract requiring Beacon to reimburse Polaris for any travel its
employees might do during the course of the contract. Again, there is no explanation in
the record as to whether Beacon employees were traveling to Florida or Polaris
employees were traveling to Tennessee. As such, we simply cannot discern whether
“substantial services” were rendered in Florida, or if payment was merely meant to be
tendered to a Florida company. Bohlander, 920 So.2d at 1228 (noting that payment to a
resident company is insufficient to establish minimum contacts with the State of Florida).
Details regarding the performance of the contract between Beacon and Polaris are
necessary to determine whether Florida acquired personal jurisdiction over Hillcrest.
Coupled with the other deficiencies noted in this Opinion, the absence of undisputed facts
showing performance of the contract in Florida renders summary judgment in favor of
Polaris inappropriate.
Next, Polaris urges on appeal that Hillcrest was subject to personal jurisdiction in
Florida because the April 2015 contract provides that it “shall be governed by the laws of
the State of Florida[,]” and that the trial court was correct in finding that “there is no
issue of fact that the parties agreed to Florida jurisdiction.” According to Polaris, the
above language constitutes consent by Hillcrest to Florida’s jurisdiction. For a number of
reasons, we respectfully disagree.
First, although Florida law provides for certain circumstances under which parties
can agree to personal jurisdiction within the state, the contract at issue does not fall
within those enumerated circumstances. Section 685.101(1) of the Florida code provides
that
The parties to any contract, agreement, or undertaking, contingent or
otherwise, in consideration of or relating to any obligation arising out of a
transaction involving in the aggregate not less than $250,000, the
equivalent thereof in any foreign currency, or services or tangible or
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intangible property, or both, of equivalent value, including a transaction
otherwise covered by s. 671.105(1), may, to the extent permitted under the
United States Constitution, agree that the law of this state will govern such
contract, agreement, or undertaking, the effect thereof and their rights and
duties thereunder, in whole or in part, whether or not such contract,
agreement, or undertaking bears any relation to this state.
Further, in relation to section 685.101, section 685.102 provides that
Notwithstanding any law that limits the right of a person to maintain an
action or proceeding, any person may, to the extent permitted under the
United States Constitution, maintain in this state an action or proceeding
against any person or other entity residing or located outside this state, if
the action or proceeding arises out of or relates to any contract, agreement,
or undertaking for which a choice of the law of this state, in whole or in
part, has been made pursuant to s. 685.101 and which contains a
provision by which such person or other entity residing or located
outside this state agrees to submit to the jurisdiction of the courts of
this state.
(emphasis added). Construing these two sections in tandem, it has been held that in order
for a contract to confer personal jurisdiction on a Florida court, an agreement must satisfy
the following: (1) a choice of law provision designating Florida law as the governing law,
(2) a provision whereby the nonresident agrees to submit to the jurisdiction of the courts
of Florida, (3) consideration of not less than $250,000, (4) inoffensive to the United
States Constitution, and (5) either bears a substantial or reasonable relation to Florida or
at least one of the parties is a resident of Florida or incorporated under its laws.
Jetbroadband WV, LLC v. MasTec North Amer., Inc., 13 So.3d 159, 16263 (Fla. Dist.
Ct. App. 2009). Indeed, with the enactment of “section 685.102, the [Florida] Legislature,
by its clear terms, granted parties . . . the right to confer personal jurisdiction by
agreement.” Id. at 163.
However, as the Jetbroadband court also makes clear, an agreement that confers
personal jurisdiction over an out-of-state defendant requires both a choice of law
provision as well as a provision in which “the non-resident agrees to submit to the
jurisdiction of the courts of Florida.” Id. Stated differently, the contract or agreement
must contain both a choice of law provision and a forum selection clause. See 7 Williston
on Contracts § 15:15 (4th ed.) (“A ‘choice-of-forum clause’ is one in which the parties
agree on a presiding tribunal; a ‘choice of law clause,’ on the other hand, indicates which
jurisdiction’s law will govern the interpretation of a contract if litigation ensues”).
In the present case, however, the April 2015 contract between Beacon and Polaris
provides only that it “shall be governed by the laws of the State of Florida.” There is
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nothing in the contract that indicates that Hillcrest ever agreed to submit to the personal
jurisdiction of the courts of Florida. While Polaris appears to assert that the relevant
provision constitutes a forum selection clause pursuant to which Hillcrest consented to
personal jurisdiction in a Florida court, this assertion conflates a forum selection clause
with a choice of law clause and ignores the fact that there are additional jurisdictional
requirements that must be satisfied.7 Consequently, the provision that Polaris and the trial
court rely on so heavily is not, in and of itself, sufficient to bring Hillcrest within the
personal jurisdiction of the Florida court. See Corp. Creations Enterprises LLC v. Brian
R. Fons Attorney at Law P.C., 225 So.3d 296, 301 (Fla. Dist. Ct. App. 2017) (discussing
this issue under section 685.101 and noting that the agreement at issue in that case
satisfied all five jurisdictional requirements delineated in Jetbroadband).
Further complicating this issue is Polaris’s failure to explain why the record on
appeal contains two contracts between Beacon and Polaris. One contract was entered into
in April of 2015, and the other was entered into in June of 2015. As stated supra, the
April 2015 contract states that it will be controlled by the law of the State of Florida,
while the June 2015 contract provides that it is controlled by the laws of Arkansas. While
Polaris heavily relies on the choice of law clause in the first contract in arguing that
Hillcrest consented to Florida jurisdiction, there is no explanation in the record as to why
the April 2015 contract is controlling over the June 2015 contract. Likewise, there is no
explanation as to why Polaris and Beacon would agree to be governed by the law of the
State of Arkansas, or what effect this had on Florida’s exercise of personal jurisdiction.
Given the foregoing, the contracts themselves simply are not sufficient to subject
Hillcrest to Florida’s jurisdiction.
Beacon’s reliance on the contracts themselves also presupposes that Hillcrest was
a party to the contracts. As previously discussed, Beacon administrators, rather than
officers of Hillcrest, signed both the April 2015 and the June 2015 contracts with Polaris.
Hillcrest asserts that it had no knowledge of or involvement in the agreement with
Polaris, and that only Beacon administrators knew about the contract with Polaris. As
previously discussed, Florida courts have previously held disputes concerning whether a
contract was entered into by an independent contractor rendered summary dismissal
inappropriate. See Kwap, 220 So. 3d 1208 (holding that allegations that a contract was
entered into by the defendant’s independent contractor were sufficient to “refute the
jurisdictional allegations in the complaint” such that a dispute of material fact was
created). Accordingly, we cannot embrace the trial court’s finding that “there is no issue
of fact that the parties agreed to Florida jurisdiction.”
7
For example, section 685.101 also provides that it only applies to “obligation[s] arising out of a
transaction involving in the aggregate not less than $250,000.” The Florida judgment at issue is worth far
less than the statutory requirement.
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Under these particular circumstances, we simply cannot conclude that no genuine
issues of material fact exist such that summary judgment in favor of Polaris is
appropriate. Summary judgment proceedings have never been envisioned as substitutes
for trials of disputed factual issues. CAO Holdings, Inc. v. Trost, 333 S.W.3d 73, 87
(Tenn. 2010) (citing Fruge v. Doe, 952 S.W.2d 408, 410 (Tenn. 1997)). Summary
judgment “should not replace a trial when disputed factual issues exist, because its
purpose is not to weigh the evidence, to resolve factual disputes, or to draw inferences
from the facts.” Downs v. Bush, 263 S.W.3d 812, 815 (Tenn. 2008). Courts should grant
summary judgment “only when both the facts and the conclusions to be drawn from the
facts permit a reasonable person to reach only one conclusion.” Carvell v. Bottoms, 900
S.W.2d 23, 26 (Tenn. 1995). Although Polaris contends that the facts surrounding the
signing of the contract are not in dispute, the inferences to be drawn from those facts are
sharply disputed. Weighing these inferences is simply not appropriate at the summary
judgment stage. In light of the significant questions surrounding whether the Florida
court ever acquired personal jurisdiction over Hillcrest, and Polaris’s failure to address
those questions, we conclude that the trial court erred in granting summary judgment to
Polaris and effectively enrolling the Florida default judgment. Because we conclude that
the trial court’s order granting summary judgment should be vacated and remanded based
upon the issues surrounding the jurisdiction of the Florida court, the issue of whether
service of process on Hillcrest was adequate is hereby pretermitted.
Conclusion
The order of the Davidson County Chancery Court granting summary judgment in favor
of Cannon and Associates, LLC d/b/a/ Polaris Group is hereby vacated and remanded for
further proceedings consistent with this Opinion. Costs of this appeal are assessed against
Cannon and Associates, LLC d/b/a/ Polaris Group, for which execution may issue if
necessary.
_________________________________
J. STEVEN STAFFORD, JUDGE
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