By Michael P. Sampson (part 3 of 8)
For the Florida court to adjudicate claims against the corporation or trust, does the family law pleading allege personal jurisdiction over the entity? If service of process on an entity is sufficient in the family law case, is there personal jurisdiction over the entity for the family law party to proceed against the entity?
Family Law Pleading Must Allege Personal Jurisdiction Over Foreign Entity
A court has no jurisdiction over foreign entity named in a divorce action when the family law pleading fails to allege personal jurisdiction. Namely, the spouse who want to join the entity must allege it is subject to long-arm jurisdiction and has sufficient minimum contacts with Florida to defend here. See Fishman, Inc. v. Fishman, 657 So. 2d 44 (Fla. 4th DCA 1995) (if a petitioner fails to plead a legally sufficient basis for long-arm jurisdiction, the respondent “need not come forward with affidavits to prove a negative — that is, that there is no jurisdiction.”)
Thus, in Rollet v. de Bizemont, 159 So. 3d 351 (Fla. 3d DCA 2015), the court dismissed a divorcing French wife’s complaint that failed to allege sufficient long-arm jurisdictional facts against a nonresident foreign entity and her nonresident husband. She alleged he fraudulently or under undue influence assigned a contract to buy a South Beach condo without her consent and to divest her of property rights.
Similarly, in Morgan v. Morgan, 679 So. 2d 342 (Fla. 2d DCA 1996), a mother’s unsworn pleading alleging a nonresident father failed to provide child support to children in Florida was deficient. She failed to allege a proper basis for jurisdiction under the Long Arm Statute.
Likewise, an ex-wife’s pleadings fell short in Murphy v. Murphy, Case No. 1D20-1117 (Fla. 1st DCA Jul 6, 2022). The trial court should have dismissed her action against her nonresident ex-husband. She failed to establish a basis under Florida’s long-arm statute for specific or general personal jurisdiction over him to adjudicate her claims to domesticate and enforce a Hawaiian divorce judgment.
Threshold Analysis: Does the Family Law Pleading Allege Personal Jurisdiction?
As a threshold matter, a plaintiff must plead (and if challenged, prove) that a non-resident defendant engaged in statutorily enumerated conduct before a court may treat service of Florida process outside the state as if the plaintiff had effectuated service within Florida. Section 48.193(3), Florida Statutes; Cortez v. Palace Resorts, Inc., 123 So. 3d 1085 (Fla. 2013); Murphy.
As discussed above, the Murphy court found the former wife’s pleadings deficient to allege a basis for long-arm jurisdiction over her ex-husband. To satisfy the pleading requirement, she had to plead at least language that tracked the long-arm statute. But she didn’t have to plead specific facts supporting service of process on him. Murphy v. Murphy, Case No. 1D20-1117 (Fla. 1st DCA Jul 6, 2022).
Alternatively, she could’ve alleged specific facts about how his actions fit within one of the sections of the long-arm statute. Dep’t of Legal Affairs v. Wyndham Int’l, Inc., 869 So. 2d 592 (Fla. 1st DCA 2004). But all she alleged was how long he had lived in Florida before he left, the properties he used to own in Florida, and the possibility that he may still own property in Florida.
Grammar Rules: The Long-Arm Statute Requires Personal Jurisdiction to Be Based on Current Activity
Following grammar rules, the Murphy court read Florida’s long-arm statute as requiring jurisdiction to be based on current (not exclusively past) substantial and not isolated activity. Heineken v. Heineken, 683 So. 2d 194 (Fla. 1st DCA 1996); Gibbons v. Brown, 716 So. 2d 868 (Fla. 1st DCA 1998).
We say this because the linking verb in the statutory provision that we highlighted in the prior paragraph (viz.: “is engaged”) is in the present tense. It is part of an adjective clause that begins with the relative pronoun serving as the subject of the clause—“who.” That clause altogether modifies the antecedent of “who,” which is “a defendant.” This adjective clause, stated in the present tense, thereby describes the type of defendant subject to general jurisdiction in subsection (2). That is to say, because the verb “is” links the past participle “engaged”—operating here as a subject complement—to the relative pronoun it modifies—“who”—the clause effectively links “engaged” (in the present tense) to the defendant being described. This means, in turn, that jurisdiction must be based on current (not exclusively past) “substantial and not isolated activity” within Florida.Murphy v. Murphy, Case No. 1D20-1117 (Fla. 1st DCA Jul 6, 2022).
Alleging Contributions of Marital Funds or Effort Alone Is Insufficient to Establish Long Arm Jurisdiction
A spouse’s alleging an entity must be brought in because of either spouse’s marital contributions of marital funds or effort is not enough to bring the entity within the jurisdictional reach of the circuit court where the Florida divorce action is pending. See Fishman, 657 So. 2d at 46.
See also Manus v. Manus, 193 So. 2d 236 (Fla. 4th DCA 1966). In Manus, the court upheld quashing service on the president of a foreign corporation, while he was in Florida en route to the Bahamas. The wife failed to show her claim against the corporation arose out of an obligation or cause connected with the corporation’s activities in Florida. Instead, her claim was merely based on the husband’s majority ownership of stock in the corporation and alleged threats to remove his assets from the state and country.
Operating a Business or Owning Property in Florida
Operating a business in Florida, owning real property in Florida, committing a tortious act in Florida, breaching a contract in Florida, or engaging in substantial business activity in Florida may give rise to long arm jurisdiction. Section 48.193, Florida Statutes.
For example, Florida’s jurisdiction extended to a foreign corporation in a marriage dissolution case, because the suing spouse alleged the corporation unlawfully removed or encumbered marital assets. Thus, the predicate for jurisdiction was the alleged commission of a tortious act within Florida. Lee B. Stern & Co., Ltd. v. Green, 398 So. 2d 918 (Fla. 3d DCA 1981).
But consider Bacinello v. Admiral Marine Surveyors LLC, Case No. 3D21-927 (Fla. 3d DCA March 16, 2022). In Bacinello, the president and only employee of a company sought dismissal of claims arising from the company’s buying a yacht in Florida. Through affidavits, he successfully defended against claims he operated a business in Florida, thus was subject to specific personal jurisdiction.
However, regarding claims Mr. Bacinello committed a tortious act in Florida, by secretly recording phone calls while he was in Canada (where it’s legal to record a call without the other party’s permission), in violation of Florida’s Security of Communications Act, the Third DCA remanded for the trial judge to resolve fact questions about whether he submitted himself to jurisdiction of Florida by committing a tortious act within the state.
Parent Companies and Affiliated Entities
A foreign corporation’s mere affiliation with a Florida subsidiary isn’t enough to establish personal jurisdiction. A medical malpractice plaintiff discovered that in The Schumacher Group of Delaware, Inc. v. Dictan, 327 So. 3d 404 (Fla. 3d DCA 2021). That case held sharing trademarks among affiliates (including Florida affiliates) is insufficient to subject a foreign entity to Florida long-arm jurisdiction. Trademarks aren’t legal entities through which a person can act. An affiliate’s using the same trademarks, branding scheme, logo, common email domain, or employment policy manuals as its parent holding company doesn’t confer personal jurisdiction over the parent.
Suppose a spouse takes it further and alleges the parent acted in concert with a Florida entity to do wrong?
Alleged Conspiracy Between the Other Spouse and a Nonresident Corporation
One spouse might assert the other spouse and a nonresident corporation or person engaged in civil conspiracy to commit a tort. Examples include fraud, breach of fiduciary duty, trespass to property, or some other tort.
If a plaintiff successfully alleges a conspirator committed tortious acts in Florida to further the conspiracy, all coconspirators are subject to personal jurisdiction under Florida’s long-arm statute. NHB Advisors, Inc. v. Czyzyk, 95 So. 3d 444 (Fla. 4th DCA 2012); section 48.193(1)(a)2., Fla. Stat.
Specific Allegations of Conspiracy Are Required
General allegations of conspiracy are not enough. A claim for civil conspiracy must include clear, positive, and specific allegations, including how the entity conspired with the other defendants to facilitate the tortious conduct. See Parisi v. Quadri de Kingston, 314 So. 3d 656 (Fla. 3d DCA 2021); Abdo v. Abdo, 263 So. 3d 141 (Fla. 2d DCA 2018) (trial court lacked personal jurisdiction over two business entities to whom siblings transferred websites, where plaintiffs failed to make any specific allegations the entities breached a fiduciary duty, aided and abetted such a breach, or conspired to facilitate one).
Use Affidavits or Declarations to Support Dismissal When Family Law Pleading Alleges Basis for Personal Jurisdition
A spouse may allege various grounds to pull a foreign corporation or trust into a Florida divorce. Regardless of the grounds, however, the spouse and defending entity, more likely than not, will need to get sworn affidavits or declarations under penalty of perjury. Affidavits or declarations from people with knowledge can help the judge decide threshold jurisdictional issues.
Checklist for challenges to personal jurisdiction:
- Has the family law pleading alleged a basis for personal jurisdiction over the entity?
- Is there a proper basis to proceed against the entity in Florida state court?
- Corporations: look to the state of incorporation and principal place of business.
- Partnerships/LLCs: look to the residence of the partners/members.
- Trusts: look to the situs of the trust.
- What is the conduct or asset at issue in the family law proceeding?
- What does the party specifically allege the entity allegedly did to bring it into the family law action?
- Does the alleged basis for the cause of action arise out of the entity’s conduct in or directed to Florida?
- Has the spouse controlled and operated the entity and its assets and debts and, if so, how?
- Issues can be tricky where declaratory or injunctive relief or sequestration of assets is sought.
Related Blog Posts:
- Corporation or Trust Challenges to Service of Process and Jurisdiction
- Challenge to Personal Jurisdiction: Service of Process
- Personal Jurisdiction – Long-Arm Statute or Alter Ego Theory?
- Long-Arm Jurisdiction: Specific or General?
- Jurisdiction Over Property at Issue in Florida Divorce
- Affidavits to Support Challenges to Jurisdiction in Florida Divorce