E-mail and Telephone Call Held Sufficient to Justify Exercise of Personal Jurisdiction

In Moncrief v. Clark (H040098, filed July 21, 2015), the California Court of Appeal, Sixth District, held that an out-of-state attorney’s phone call and e-mail to a California attorney, pertaining to a deal between their respective clients, was sufficient to justify the exercise of personal jurisdiction over the out-of-state attorney in an action by the California attorney for misrepresentation.

California Attorney Paul Moncrief represented a potential buyer of farm equipment that Arizona attorney A. James Clark’s client was selling. After negotiations took place between their respective clients, Moncrief’s client requested that Moncrief contact Clark to obtain guarantees regarding title to the farm equipment being sold. Moncrief left a voicemail message for Clark. Clark then contacted Moncrief by telephone and represented that his client was the sole owner of the farm equipment subject to the sale. Following the telephone conversation, Clark sent an e-mail to Moncrief wherein he stated “I have been the attorney for [seller]…and can state unequivocally that the cooling equipment you are buying is free and clear and is owned by [seller]….” Moncrief then advised his client to proceed with the purchase of the equipment.

Shortly thereafter, the buyer learned that the seller did not own the equipment in issue. The buyer sued Moncrief for legal malpractice in California State Court, and Moncrief filed a cross-complaint against Clark for indemnity, negligence, intentional misrepresentation, negligent misrepresentation, and concealment. Clark filed a motion to quash service of process for lack of personal jurisdiction. The trial court granted the motion.

The Sixth District Court of Appeal reversed, holding that Clark’s e-mail and telephone communication with Moncrief were sufficient to justify the exercise of specific personal jurisdiction over Clark.

First, the Court concluded that Clark had purposefully and voluntarily directed his communications to Moncrief, a California resident, such that Clark purposefully availed himself of the benefits of conducting activities in California. Second, the Court held the communications from Clark to Moncrief were sufficiently related with the controversy alleged by Moncrief’s cross-complaint. Third, the Court held Clark had failed to demonstrate any compelling reason why the imposition of jurisdiction would result in offending traditional notions of fair play and substantial justice.

The holding demonstrates that activities directed at a forum state, related to the ultimate controversy, may form the basis for exercising specific personal jurisdiction even where such activities are minimal. Here, a single telephone call and e-mail to a California resident were sufficient. This case has broad implications for entities, and their attorneys, engaging in business transactions with out-of-state businesses.

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