Bill Gailey v. Kim Whiting
157 Idaho 727
| Idaho | 2014Background
- In 1994 Gailey (Oregon resident) purchased a life insurance policy in Boise from Whiting (then an Idaho resident/agent).
- Gailey and Whiting had minimal contact after 2008; Whiting moved to Hawaii in May 2011 and surrendered his Idaho license in June 2011.
- In August 2011 Gailey called Whiting (using a 208 area code) and, while Whiting was in Hawaii, received advice to surrender the policy and cash it out.
- Gailey surrendered the policy, later incurred significant taxable gain, and sued Whiting in Ada County (March 2013) for professional negligence for failing to warn about tax consequences.
- Whiting made a special appearance and moved to dismiss for lack of personal jurisdiction; the district court granted the motion and Gailey appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Idaho courts may assert jurisdiction under the long-arm statute's "transacting business" prong (I.C. § 5-514(a)) | Gailey: long-term business relationship and prior sale in Idaho, continued listing as Idaho rep and use of 208 number mean Whiting transacted business in Idaho and the negligence "arose from" that business | Whiting: the negligent advice was given from Hawaii to an Oregon resident in 2011 and did not constitute doing an act for pecuniary benefit in Idaho nor arise from Idaho transactions | Court: No. The negligent advice was tangential to the 1994 sale and did not "arise from" transacting business in Idaho; § 5-514(a) does not reach this tort claim |
| Whether Idaho courts may assert jurisdiction under the long-arm statute's "tort" prong (I.C. § 5-514(b)) | Gailey: effects-of-the-tort test (Blimka) — even if act occurred outside Idaho, its effects reach Idaho and invoke § 5-514(b) | Whiting: the alleged tort was committed in Hawaii and its effects (tax consequences) were felt in Oregon, not Idaho | Court: No. The tort was committed in Hawaii and the effects were directed to Oregon; Blimka's effects analysis does not apply to create jurisdiction here |
Key Cases Cited
- McAnally v. Bonjac, Inc., 137 Idaho 488, 50 P.3d 983 (Idaho 2002) (personal jurisdiction over out-of-state defendant is reviewed de novo)
- Knutsen v. Cloud, 142 Idaho 148, 124 P.3d 1024 (Idaho 2005) (evidentiary standard for reviewing jurisdictional dismissal parallels summary judgment review)
- Blimka v. My Web Wholesaler, LLC, 143 Idaho 723, 152 P.3d 594 (Idaho 2007) (discusses the "effects" test in jurisdictional analysis)
- Houghland Farms, Inc. v. Johnson, 119 Idaho 72, 803 P.2d 978 (Idaho 1990) (long-arm jurisdiction limited to causes of action arising from enumerated acts)
- St. Alphonsus Reg'l Med. Ctr. v. State of Wash., 123 Idaho 739, 852 P.2d 481 (Idaho 1993) (allegation that injury occurred in Idaho can invoke § 5-514(b))