YA Global Investments, L.P. v. Cliff
15 A.3d 857
| N.J. Super. Ct. App. Div. | 2011Background
- YA Global Investments filed suit in Hudson County seeking to collect on personal guarantees executed by the Hacketts in 2006.
- The Hacketts reside in Ogdensburg, New York, where PHHC conducted business; PHHC did not sell or solicit NJ customers or operate online in NJ.
- In 2006 the Hacketts signed Commercial Loan Guaranties guaranteeing PHHC debt to Community Bank; guarantees stated governing law New York, no forum clause.
- In 2007 the Hacketts sold PHHC stock to Wisebuys; Wisebuys/Seaway later refinanced PHHC debt with YA; Seaway and Wisebuys involvement tied to subsequent transactions.
- In March 2008 YA and Seaway executed an Exchange Agreement replacing five notes with a single debenture; the Hacketts signed a sheet titled “Agreed and Acknowledged.”
- YA argued the Exchange Agreement’s forum clause bound NJ courts to hear disputes; the trial court held the Hacketts were not parties to the Exchange Agreement and dismissed for lack of personal jurisdiction; on appeal, the court affirmed dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does NJ have personal jurisdiction over the Hacketts? | YA contends the Exchange Agreement’s forum clause binds Hacketts. | Hacketts were not parties to the Exchange Agreement; no NJ contacts. | No personal jurisdiction; Hacketts not bound by clause. |
| Is the forum-selection clause binding on non-parties to the Exchange Agreement? | The clause applies because the Hacketts agreed and acknowledged the agreement. | Only Seaway and YA are parties to the Exchange Agreement; Hacketts not bound. | Binding only on the two parties; non-parties not bound. |
| Was extrinsic evidence or jurisdictional discovery appropriate to determine parties to the Exchange Agreement? | Discovery could establish whether the Hacketts were parties or intended to be bound. | The agreement’s text is clear; extrinsic evidence would not alter its meaning. | No jurisdictional discovery; extrinsic evidence unnecessary; text controls. |
| Should the interpretation of the Exchange Agreement consider extrinsic circumstances? | Extrinsic evidence could illuminate intended meaning of “parties.” | The text plainly indicates two parties; extrinsic evidence cannot override clear terms. | Extrinsic evidence not used to alter clear, integrated terms. |
Key Cases Cited
- Waste Mgmt., Inc. v. Admiral Ins. Co., 138 N.J. 106 (N.J. 1994) (minimum contacts and long-arm due process framework)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (U.S. 1985) (purposeful availment and fair play in due process)
- Mastondrea v. Occidental Hotels Mgmt., S.A., 391 N.J. Super. 261 (N.J. App. Div. 2007) (de novo review of jurisdiction; factual findings reviewed for substantial evidence)
- Reliance Nat’l Ins. Co. in Liquidation v. Dana Transport, Inc., 376 N.J. Super. 537 (N.J. App. Div. 2005) (long-arm jurisdiction and due process standards)
- Deerhurst Estates v. Meadow Homes, Inc., 64 N.J. Super. 134 (N.J. App. Div. 1960) (extrinsic evidence aids interpretation of integrated contracts)
- Garden State Plaza Corp. v. S.S. Kresge Co., 78 N.J. Super. 485 (N.J. App. Div. 1963) (parol evidence cannot alter integrated contract terms)
- Conway v. 287 Corporate Ctr. Assocs., 187 N.J. 259 (N.J. 2006) (limits on parol evidence in contract interpretation)
- Schwimmer v. Atlantic City Air Lines, Inc., 12 N.J. 293 (N.J. 1953) (contextual interpretation of contract language)
- M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (U.S. 1972) (forum-selection clause enforceability criteria)
- Nicastro v. McIntyre Mach. Am., Ltd., 201 N.J. 48 (N.J. 2010) (limits and analysis of specific jurisdiction)