Arroyo v. Mountain School
892 N.Y.2d 74
N.Y. App. Div.
2009
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QUEMUEL ARROYO, Respondent, v THE MOUNTAIN SCHOOL et al., Appellants.

Appellate Division of the Supreme Court of the State of New York, First Department

892 N.Y.S.2d 74

Plaintiff, a New York resident who was a student at defendant Mountain School, was injured in a bicycle accident at the school‘s premises in Vermont. The Mountain School is a program of defendant Milton Academy, which is located in Massachusetts.

Defendants are not subject to general jurisdiction pursuant to the “solicitation plus” doctrine (see e.g. ; ; ). Milton Academy advertises neither on the radio nor on television in New York, visits New York only occasionally, and held only three alumni-related events in New York in 2007 and three in 2008. The fact that it offers its students bus service to New York—with stops in Connecticut—on five holidays is not dispositive (see ). Unlike the defendant in , Milton has issued no bonds in New York and owns no real property in New York. Furthermore, there was no evidence that Milton sent representatives to 44 secondary schools in New York State per year or had more than $14 million in a New York bank account (cf. ).

Even if, arguendo, Milton engaged in “substantial solicitation” (), it did not engage in sufficient “activities of substance in addition to solicitation” (). CityTerm is a program of nonparty Masters School, not of defendants. “A business relationship with a New York entity does not provide a sufficient basis for jurisdiction at least in the absence of a showing that that company has become an agent or division of the company over which the plaintiff seeks to exercise personal jurisdiction” (). Plaintiff, who bears the burden of proving jurisdiction (see e.g. , lv denied 12 NY3d 711 [2009]), did not show that the Masters School was defendants’ agent, much less a division of defendants.

The fact that Milton had approximately $14 million (less than 10% of its endowment) invested with New York firms as of June 30, 2006 does not subject it to general jurisdiction here. “[T]he investment of money in New York cannot alone be considered a form of ‘doing business’ for the purpose of CPLR § 301 . . . ; ‘if it were, then almost every company in the country would be subject to New York‘s jurisdiction’ ” (, , quoting ; see also , affd ).

Similarly, the fact that Milton has a New York bank account for the purpose of receiving wire transfers, which funds are then transferred to a Morgan Stanley account in Boston, does not subject it to general jurisdiction (see ; see also ). Defendants’ ordinary business is educating students, which they do in Massachusetts and Vermont; their “maintenance of a bank account in New York is only incidental to” that business ().

Defendants are not subject to specific jurisdiction under CPLR 302 (a) (1). Even if defendants transacted business within New York, “plaintiff‘s . . . injury and the tort action based on it cannot be said to have arisen directly out of this” transaction (; see e.g. ;

). Defendants’ duty of care to plaintiff arose in Vermont, not in New York (see e.g. ; ). Concur—Gonzalez, P.J., Tom, Sweeny, Freedman and Abdus-Salaam, JJ.