JAMES EDWARD BEASLEY, APPELLANT,
v.
DIAMOND R. FERTILIZER, CO., INC., ET AL., APPELLEES
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An Alabama resident formed a Florida corporation that never conducted actual business, merely opening a dormant bank account before being dissolved. The lower court exercised jurisdiction over him based on the corporation's formation and bank account; the appellate court reversed, holding that mere formation of a corporation by a non-resident does not subject the shareholder to Florida jurisdiction absent a valid statutory basis for long-arm jurisdiction.
The court held that the lower court erred in exercising jurisdiction over Beasley. The minimum contacts analysis cannot be reached until the statutory basis for long-arm jurisdiction is first established. Mere formation of a Florida corporation by a non-resident, and even conduct of business by the corporation in Florida, do not subject the shareholder to Florida jurisdiction.
[1] A court must first establish a statutory basis for long-arm jurisdiction before considering whether a defendant has the requisite minimum contacts with the forum state.
[2] The mere formation of a corporation in a state by a non-resident, even if the corporation conducts business there, does not automatically subject the shareholder to the j…
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Join FLexlaw to unlock all legal intelligence“This ruling was error because the minimum contacts issue is not reached until the statutory basis for long-arm jurisdiction is met.”
Establishes the two-step jurisdictional framework that the lower court failed to follow.
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Join FLexlaw to unlock all legal intelligenceBeasley, an Alabama resident, formed a Florida corporation called Beasley Packing, Inc. in early 1992 at the suggestion of his brother-in-law. The cor…
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GRIFFIN, Chief Judge.
Appellant, James Edward Beasley [“Beasley”], an Alabama resident, seeks review of an interlocutory order of the lower court determining that he is subject to the in personam jurisdiction of the courts of Florida.
Appellee, Diamond R. Fertilizer, Co., Inc., sued appellant, Beasley Packing, Inc. and others arising out of a transaction in which they had supplied various agricultural chemicals. Appellant responded to the complaint filed against him by filing a motion to quash and a motion to dismiss with his supporting affidavit purporting to refute the jurisdictional allegations of the complaint. No counter-affidavit was filed; nevertheless, the lower court denied the motion, apparently on the ground that Beasley was deemed to have the requisite minimum contacts with Florida. As the lower court described it, Beasley “has been advantaged by Florida’s corporation law and it does not offend traditional notions of fair play and substantial justice to require he be required to be hailed into court here.” This ruling was error because the minimum contacts issue is not reached until the statutory basis for long-arm jurisdiction is met. Hete there was no adequate basis for jurisdiction pleaded, and even if it had been adequately pleaded, the appellant’s affidavit was sufficient to refute the allegations.
Appellee contends that it need not have filed any affidavit because the allegations in Beasley’s own affidavit were sufficient to establish jurisdiction. In pertinent part, Beasley alleged:
In the early part of the year 1992, I formed a corporation which was known as Beasley Packing, Inc., a Florida corporation. I formed this corporation at the suggestion or request of my brother-in-law, Mr. John H. Day. This corporation never actually carried on any trade or business, and it was administratively dissolved by the Secretary of State, of the State of Florida, some time in the year 1993. Mr. Day also suggested that Beasley Packing, Inc., open a bank account in the Orange Bank, in Orlando, which was accomplished by the corporation’s depositing approximately $500.00 into that account. No other funds were deposited into that account. No business was ever transacted utilizing the funds in this account, and the account was closed out prior to the filing of this suit.
Appellee contends that the mere formation of the corporation and the opening of a bank account prove “an intent” [presumably on Beasley’s part] to engage in a business venture in Florida sufficient to meet the statutory test for in personam jurisdiction. This is incorrect. The mere formation of a corporation in Florida by a non-resident, and even the conduct of business by the corporation in Florida, do not subject the shareholder to the jurisdiction of Florida courts. See, e.g., Sur oor v. First Investment Corp., 700 So. 2d 139 (Fla. 5th DCA 1997).
REVERSED and REMANDED.
HARRIS and THOMPSON, JJ., concur.
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Albano Seabra v. Int'l Specialty Imports, Inc., 869 So. 2d 732 (Fla. 4th DCA 2004)…roperty, had paid for services to improve the property, and had contracted to have other services performed in Orange County were insufficient to establish that he was conducting business in the state); see also Beasley v. Diamond R. Fertilizer Co., 710 So. 2d 1025, 1026 (Fla. 5th DCA 1998)(rejeeting the argument that the formation of a corporation and the opening of a bank account exhibit an intent to conduct business in Florida sufficient to meet the statutory test for in personam jurisdiction). Moreover, e…
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LAW Offs. OF Sybil Shainwald v. Barro, 817 So. 2d 873 (Fla. 5th DCA 2002)…jurisdiction by filing a motion to dismiss. The motion may challenge the jurisdictional allegations of the complaint and it may claim a lack of sufficient minimum contacts. See Venetian Salami; Horowitz; Beasley v. Diamond R. Fertilizer, Co., Inc., 710 So. 2d 1025 (Fla. 5th DCA 1998); Quality Christmas Trees; John Posey Corp. v. R.J.T. Eng’g, Inc., 617 So. 2d 441 (Fla. 5th DCA 1993). Affidavits are generally necessary to support these challenges because the motion, by itself, only raises the legal sufficiency…
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Henderson v. Elias, 56 So. 3d 86 (Fla. 4th DCA 2011)…on 48.193(1). The fact that the corporation’s two shareholders would be subject to personal jurisdiction in Florida in their individual capacities does not create personal jurisdiction over the corporation. Cf. Beasley v. Diamond R. Fertilizer, Co., 710 So. 2d 1025, 1026 (Fla. 5th DCA 1998) (holding that the conduct of business in Florida by a corporation would not subject its shareholders to personal jurisdiction in Florida). The petition contains no allegations that Stardale is Henderson’s alter ego. See, e.…
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