577 S.W.3d 322
Tex. App.2019Background
- Houston-based Developers borrowed $11,450,000 from a Delaware lender; PCG (Delaware corp with principal place in Utah) was engaged as the loan servicer.
- Loan Agreement made Developers liable for lender’s costs (servicing, legal, brokerage); PCG prepared pay-off statements and other loan communications from Utah.
- Developers allege PCG misrepresented (1) the amount of lender costs/fees and (2) the pay-off balance, causing Developers to overpay; Developers paid per PCG’s statements.
- PCG filed a special appearance asserting it is not a Texas resident, performed servicing from Utah, sent communications from Utah, and relied on the Loan Agreement’s Utah forum-selection clause.
- Trial court granted PCG’s special appearance and dismissed for lack of personal jurisdiction; Developers challenged that ruling on appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| General jurisdiction | PCG’s servicing of four Texas-secured loans, a business trip, and a foreclosure show continuous/systematic contacts | PCG’s few contacts are isolated and insufficient to be “essentially at home” in Texas | PCG negated general jurisdiction; contacts not substantial enough for general jurisdiction |
| Specific jurisdiction (purposeful availment) | PCG sent misrepresentations and communications to Texas residents and received payments from Texas, so it purposefully availed itself | Communications and transfers were made from Utah; electronic communications and wire transfers alone do not constitute purposeful availment | No specific jurisdiction: contacts were with Texas residents, not Texas itself; transmissions from Utah insufficient for purposeful availment |
| Connection between contacts and claims (arising-from requirement) | Alleged misrepresentations were directed at Texas residents about Texas-secured loan, so claims arise from PCG’s Texas contacts | PCG’s acts occurred in Utah and its servicing obligations were to a nonresident lender; alleged misrepresentations do not create a substantial Texas-focused business presence | Claims do not arise from PCG’s Texas contacts in a manner sufficient to support jurisdiction |
| Admissibility of PCG affidavit (personal knowledge) | Schramm’s affidavit lacked personal knowledge and was undermined by deposition — should be struck | Even if affidavit had issues, PCG negated jurisdiction on legal grounds independent of affidavit admissibility | Court need not resolve affidavit objection; ruling on legal insufficiency of jurisdictional allegations was dispositive |
Key Cases Cited
- Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653 (Tex. 2010) (shifting burdens in special-appearance jurisdictional analysis)
- Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569 (Tex. 2007) (purposeful availment and specific-jurisdiction principles)
- BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789 (Tex. 2002) (fact findings implied when trial court issues no findings in special appearance)
- Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d 777 (Tex. 2005) (electronic/telephone contacts and torts directed at forum do not alone establish specific jurisdiction)
- Daimler AG v. Bauman, 134 S. Ct. 746 (U.S. 2014) (general jurisdiction requires contacts rendering defendant "essentially at home" in forum)
- Old Republic Nat’l Title Ins. Co. v. Bell, 549 S.W.3d 550 (Tex. 2018) (specific-jurisdiction requiring that claims arise from defendant’s purposeful contacts with forum)