KYLE R. BROWN, APPELLANT,
v.
NOVA INFORMATION SYSTEMS, INC., ET AL., APPELLEE

Fla. 5th DCA | 2005-04-29
No. 5D04-3774
SAWAYA, C.J., and MONACO, J., concur.
903 So. 2d 968 Florida District Court of Appeal, Fifth District (2005) Positive Treatment
Cited by 3 cases

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Synopsis

Kyle Brown, a Texas resident, appeals a trial court's denial of his motion to dismiss for lack of personal jurisdiction in a case brought by Nova Information Systems alleging fraudulent transfer in violation of Florida's Uniform Fraudulent Transfer Act. The appellate court reversed, holding that Brown is not subject to Florida's long-arm jurisdiction under section 48.193 because he does not currently operate a business in Florida, is not committing a tort in the state, and is not engaged in substantial in-state activity.


Holding

Brown is not subject to personal jurisdiction in Florida under section 48.193. Brown does not currently operate a business or have an office or agency in Florida under subsection (1)(a); a fraudulent conveyance claim does not constitute a tort under subsection (1)(b); and Brown is not engaged in substantial and not isolated activity within Florida under subsection (2).


Headnotes

[1] A fraudulent conveyance claim is not a tort for purposes of establishing personal jurisdiction under Florida's long-arm statute.

[2] A plaintiff must demonstrate that a defendant committed a tortious act within Florida to establish personal jurisdiction under section 48.193(1)(b), Florida Statutes.

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Key Quotes

“a fraudulent conveyance claim has been held not to be a tort for purposes of establishing personal jurisdiction under section 48.193(l)(b)”

Establishes the key holding that fraudulent transfer violations do not constitute tortious acts under Florida's long-arm jurisdiction statute

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Facts & Procedural History

Brown lived and worked in Florida from August 2001 through August 2002 as president of BigDot 1, Inc., a Texas corporation that received an allegedly …

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Opinion of the Court
PETERSON, J.

PETERSON, J.

Kyle R. Brown, a current resident of Texas, appeals a non-final order denying his motion to dismiss for lack of personal jurisdiction.

From August 2001, through August 2002, Brown lived in Florida and worked as the president of BigDot 1, Inc., a Texas Corporation, (“BigDot”). BigDot received an alleged fraudulent transfer of funds from Yackity Yak Telecom, Inc., (‘Yackity Yak”), a judgment debtor of Nova Information Systems, Inc., (“Nova”). The judgment against Yackity Yak was entered after it defrauded Nova out of $350,582.82 in 3,417 credit card transactions. Nova alleged that Brown was involved in a conspiracy with others to transfer and conceal the transfer of funds from Yackity Yak to BigDot in order to render the judgment debtor unable to pay Nova’s judgment against it, in violation of Florida’s Uniform Fraudulent Transfer Act, section 726.106, Florida Statutes (2004). Nova alleged that Brown resided in Florida at times material to its action; that he operated, conducted, engaged in or carried on a business or business venture in Florida; and that pursuant to section 48.193(l)(a), (l)(b), and (2), he was subject to personal jurisdiction.

Brown filed a motion to dismiss for lack of personal jurisdiction, which the trial court denied without comment.

Section 48.193(l)(a), (l)(b), and (2), Florida Statutes (2004), provides:

(1) Any person, whether or not a citizen or resident of this state, who personally or through an agent does any of the acts enumerated in this subsection thereby submits himself or herself and, if he or she is a natural person, his or her personal representative to the jurisdiction of the courts of this state for any cause of action arising from the doing of any of the following acts:
(a) Operating, conducting, engaging in, or carrying on a business or business venture in this state or having an office or agency in this state.

(b) Committing a tortious act within this state.

(2) A defendant who is engaged in substantial and not isolated activity within this state, whether such activity is wholly interstate, intrastate, or otherwise, is subject to the jurisdiction of the courts of this state, whether or not the claim arises from that activity.

Brown is not subject to personal jurisdiction in Florida, pursuant to section 48.193, because:

1. Brown resides in Texas and is not presently operating, conducting, engaging in or carrying on a business or business venture in Florida; nor does he have any office or agency in Florida, as required by section 48.193(l)(a). Additionally, Nova appears to have abandoned this ground on appeal since no mention of it was made in its answer brief.

2. Brown is not committing a tortious action in this state. Contrary to Nova’s assertion that conspiracy to violate Florida’s Uniform Fraudulent Transfer Act is a tort giving rise to long-arm jurisdiction, a fraudulent conveyance claim has been held not to be a tort for purposes of establishing personal jurisdiction under section 48.193(l)(b). See Beta Real Corp. v. Graham, 839 So. 2d 890 (Fla. 3d DCA 2003); see also Freeman v. First Union Nat’l Bank, 865 So. 2d 1272 (Fla.2004) (recognizing that Florida’s Uniform Fraudulent Transfer Act only permits creditors to set aside fraudulent transfers, and that there is no language in the Act to suggest a legislative intent to create an independent tort for damages).

3. Brown is not now engaged in substantial and not isolated activity within Florida as required by section 48.193(2).

Accordingly, we must reverse the trial court’s order denying Brown’s motion to dismiss for lack of personal jurisdiction, and leave it to the Legislature to remedy what appears to be an oversight in the enactment of the legislation.

REVERSED.

SAWAYA, C.J., and MONACO, J., concur.


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Citator

Cited By

  • Edwards v. Airline Support Grp., Inc., 138 So. 3d 1209 (Fla. 4th DCA 2014)
    …8.193(l)(a)2., Florida Statutes (2013). When faced with the same determination, the third and fifth districts each found that a fraudulent transfer is not a tortious act for purposes of Florida’s long-arm statute. See Brown v. Nova Info. Sys., Inc., 903 So. 2d 968, 969 [*1212] (Fla. 5th DCA 2005); Beta Real Corp. v. Graham, 839 So. 2d 890, 891-92 (Fla. 3d DCA 2003). Moreover, this court previously noted that the majority of courts nationwide have found a fraudulent transfer does not constitute a tortious act…
  • Clement v. Lipson, 999 So. 2d 1072 (Fla. 5th DCA 2008)
    …n may be asserted against Appellants because he alleged fraud is unpersuasive. The count seeking to void allegedly fraudulent transfers is not an independent tort upon which long-arm jurisdiction can be exercised. See Brown v. Nova Info. Sys., Inc., 903 So. 2d 968, 969 (Fla. 5th DCA 2005). Furthermore, contrary to Lipson’s assertion, the counts alleging securities fraud and fraudulent sales of investment are not tantamount to common law actions for fraud. Because both of these actions are predicated on a viol…
  • Valle v. 3m Co. (N.D. Fla. 2022)

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