If you find your business embroiled in a commercial dispute and are contemplating litigation, one of the most important things you want to ensure is that the court where you file your lawsuit is in a jurisdiction that has the power to resolve your case. That means, among other things, making sure that the court has personal jurisdiction over your opponent. While many jurisdictional disputes may hinge upon jurisdiction under the “long-arm” statute, sometimes your case may be able to proceed even if the criteria of the statute aren’t met. Even if your opponent has its principal offices outside Florida and does no business here, there are situations in which the Florida courts may still have jurisdiction. For the analysis and advice you need about jurisdiction and venue in your commercial litigation action, be sure to consult a skilled South Florida commercial litigation attorney.
Jurisdiction was at the center of case arising from a dispute over a stock subscription contract. In the deal, the buyer agreed to purchase 1 million shares of another corporation’s stock. Allegedly, the purchasing corporation never paid the balance owed for the 1 million shares. As a result, a breach of contract lawsuit ensued.
The plaintiff corporation brought its lawsuit in state court here in Florida, specifically filing in Orange County. The purchaser corporation filed a motion with the court, arguing that the Florida courts lacked personal jurisdiction over it. The facts that it asserted in support of that argument were that it held its principal place of business in southern California and conducted the substantial majority of its business outside the United States. This meant that, under the terms of Florida’s “long-arm” jurisdiction statute, there was no personal jurisdiction over the defendant, it argued.
The trial judge agreed with the purchaser and dismissed the breach of contract lawsuit entirely. The plaintiff corporation appealed and was able to get its case revived.
Incorporating in Florida triggers general jurisdiction, regardless of ‘long-arm’ statute criteria
In many situations, the facts that existed in this case might have been enough to qualify as a lack of personal jurisdiction in Florida, which would allow the defendant to avoid facing trial in this state. The defendant corporation had brought sufficient evidence when it came to analyzing the criteria of Florida’s long-arm statute. However, there was one important fact that made this case different and which allowed the plaintiff to revive its case: the purchaser was a Florida corporation. An entity can, of course, incorporate in most any state, regardless of the site of its principal place of business and the location of its business activities.
In this circumstance, the defendant was a California-based corporation that had incorporated in Florida. That fact alone was enough to mean that the defendant corporation had submitted itself to the laws and the courts of Florida, which meant the plaintiff was entitled to pursue its claim in this state. Under Florida law, corporations are legal residents of the states in which they incorporate. A corporation that incorporates in Florida is legally on the same footing as an individual who is a legal resident of the state of Florida. In other words, by producing evidence that the purchaser was a Florida corporation, the plaintiff was able to establish that the purchaser was a Florida resident and subject to the general jurisdiction of the Florida courts, regardless of whether or not long-arm jurisdiction applied. The long-arm statute was irrelevant because that law applies in situations involving non-residents.
For advice and advocacy upon which you can rely in your breach of contract or other commercial litigation action, reach out to the skilled South Florida commercial litigation attorneys at Stok Kon + Braverman. Our experienced team has been helping clients protect their business interests for many years.
Contact us online or by calling (954) 237-1777 to schedule your consultation and find out how this firm can help you.
More blog posts:
Piercing the Corporate Veil in Florida to Obtain the Damages Owed to You Under a Breach of Contract Judgment, Florida Business Lawyers Blog, Oct. 29, 2018
Maryland Company Did Not ‘Purposefully Avail’ Itself and Thus Wasn’t Subject to the Jurisdiction of Florida Courts, Florida Business Lawyers Blog, Oct. 19, 2018