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2004-UP-489 - Exide Corporation v. Bush's Recycling

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Exide Corporation, and Johnson Controls, Inc.,        Respondents,

v.

Bush's Recycling, Inc.,        Appellant.


Appeal From Florence County
B. Hicks Harwell, Jr., Circuit Court Judge


Unpublished Opinion No.  2004-UP-489
Submitted September 15, 2004 – Filed September 21, 2004


AFFIRMED


Edward L. Graham, of Florence, for Appellant.

E. Lloyd Willcox, II, of Florence, for Respondents.

PER CURIAM:  In this action to enforce the judgment of an Alabama court, the appellant challenges the trial court’s determination regarding personal jurisdiction and the validity of service of process.  We affirm. [1]

FACTS

Following an investigation by the Environmental Protection Agency into the illegal dumping of hazardous substances at a smelting and battery recycling facility located in Leeds, Alabama, Exide Corporation and Johnson Controls, Inc. (“Respondents”), along with others, entered into a consent decree with the United States government.  The consent decree obligated the signatories to finance and perform cleanup at the site and also to reimburse the United States for past and future costs associated with cleanup.  As provided for by federal law, Respondents sought contribution from more than one hundred entities also identified as potentially liable for the contamination at the Leeds facility.  Among those identified by Respondents was Bush’s Recycling (“Appellant”), a corporation with its principal place of business in Florence, South Carolina.

Respondents brought suit in the United States District Court for the Northern District of Alabama, Southern Division, against Appellant and all others from whom contribution was sought.  To initiate the contribution proceedings, Respondents mailed Appellant a request to sign a waiver of service notification.  Though Appellant’s president, George Bush, read the request, he declined to waive service.  Respondents then hired a professional process server, Charles Ward, to effectuate formal service.  Ward personally served the Summons and Complaint on an employee named Areece Myers on August 27, 1999 in Florence, South Carolina. 

When Appellant failed to answer or otherwise defend against the Complaint, Respondents moved for default judgment pursuant to Rule 55(b) of the Federal Rules of Civil Procedure.  On November 19, 1999, the federal court granted the motion, issuing a default judgment against Appellant in the amount of $80,696.

Seeking to enforce the Alabama judgment against Appellant, Respondents filed a Notice of Foreign Judgment in the Florence County Court of Common Pleas on August 2, 2001, and served the same on Appellant seven days later.  In response, Appellant filed a Notice of Defenses, contending that service of process was ineffectual and the federal court in Alabama lacked personal jurisdiction over Appellant.  In addition, Appellant asserted defenses on the merits, requested relief from the judgment on account of “mistake, inadvertence, surprise or excusable neglect,” and argued the district court should have held a hearing to ascertain damages.

Following a hearing on the matter, the trial court rejected Appellant’s defenses and ordered the Alabama judgment be given full effect in South Carolina.  Appellant then filed a motion to amend the judgment, which the trial court denied.  This appeal follows.

LAW/ANALYSIS

I.  Personal Jurisdiction

Appellant contends the trial court erred in determining Appellant had sufficient contacts with Alabama to bring Appellant within the district court’s personal jurisdiction.  We disagree.

In accordance with the full faith and credit clause of the United States Constitution, the courts of one state must give such force and effect to a foreign judgment as the judgment would receive in the state where rendered.  U.S. Const. Art. IV, § 1; Carson v. Vance, 326 S.C. 543, 550, 485 S.E.2d 126, 130 (Ct. App. 1997).  At the same time, however, the full faith and credit clause only binds a court to enforce the judgment if the issuing court had jurisdiction to render the judgment.  Carson, 326 S.C. at 548.  Thus, “[a] defendant is always free to ignore the judicial proceedings, risk a default judgment, and then challenge that judgment on jurisdictional grounds in a collateral proceeding.”  Ins. Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 706 (1982).

“The question of personal jurisdiction over a nonresident defendant is one which must be resolved upon the facts of each particular case.  The decision of the trial court should be affirmed unless unsupported by the evidence or influenced by an error of law.”  Moosally v. W.W. Norton & Co., Inc., 358 S.C. 320, 327, 594 S.E.2d 878, 882 (Ct. App. 2004) (citations omitted).

The determination of whether a court may exercise personal jurisdiction over a nonresident involves a two-step analysis: (1) the nonresident’s conduct must meet the requirements of the state’s long-arm statute and (2) the exercise of jurisdiction must comport with the requirements of the due process clause.  Southern Plastics Co. v. Southern Commerce Bank, 310 S.C. 256, 259, 423 S.E.2d 128, 130 (1992).  Like those of many other states, Alabama’s long-arm statute is construed to extend jurisdiction over nonresident defendants to the full extent permitted by the due process clause.  Sieber v. Campbell, 810 So.2d 641, 643-44 (Ala. 2001).  As a consequence, the two-part jurisdictional analysis collapses into a single inquiry as to whether the defendant had “minimal contacts” with the forum state such that “maintenance of the suit does not offend traditional notions of fair play and substantial justice.”  Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945); see also Marbury v. Am. Truetzschler, 111 F. Supp. 2d 1281, 1283 (M.D. Ala. 2000) (“‘When the courts of the forum State have interpreted the forum’s long-arm statute to confer jurisdiction to the limits allowed by federal due process, state law need not be applied: [the court] need only ask whether the exercise of jurisdiction over the nonresident defendant comports with due process.’” (citing Vermeulen v. Renault U.S.A., Inc., 975 F.2d 746, 753 (11th Cir. 1992)).

We find such minimum contacts exist.  On at least seven occasions, Appellant shipped lead-spent batteries to a company named International Lead Company in Leeds, Alabama.  Although Appellant delivered the batteries through an intermediary, Appellant’s invoices reveal that it was purposefully directing a product of its recycling business to a specific location in Alabama.  Additionally, exercise of personal jurisdiction over Appellant does not offend “traditional notions of fair play and substantial justice.”  Int’l Shoe, 326 U.S. at 316.  In the course of participating in an industry that regularly implicates commerce between and among multiple states, Appellant voluntarily conducted business with Alabama, thereby invoking the protection of its laws.  In this manner, notions of fair play and substantial justice are both rightfully served in requiring Appellant to answer in an Alabama court for any tortious acts committed there.  Accordingly, the trial court correctly determined the Alabama court’s exercise of personal jurisdiction over Appellant was proper.

II.  Service of Process

Appellant contends the trial court erred in determining the Respondent’s personal service of process on Myers was proper service on the corporation.  We disagree.

“Questions of fact arising on a motion to quash service of process for lack of jurisdiction over the defendant are to be determined by the court.  The findings of the [trial] court on such issues are binding on the appellate court unless wholly unsupported by the evidence or manifestly influenced or controlled by error of law.”  Brown v. Carolina Emergency Physicians, P.A., 348 S.C. 569, 583, 560 S.E.2d 624, 631 (Ct. App. 2001) (citations omitted).

As outlined by both the Federal Rules of Civil Procedure and the South Carolina Rules of Civil Procedure, service of process serves two purposes:  it confers personal jurisdiction on the court and it assures the defendant has reasonable notice of the action.  Roche v. Young Bros., Inc., of Florence, 318 S.C. 207, 209, 456 S.E.2d 897, 899 (1995).  Our courts have never predicated effective service of process on exacting compliance with the rules.  Rather, we inquire as to whether the plaintiff has sufficiently complied with the rules as to confer personal jurisdiction and provide the defendant with notice of the proceedings.  Id. at 210, 456 S.E.2d at 899.

Like its federal counterpart, Rule 4(d)(1), SCRCP, provides for service upon an agent only if authorized by appointment or by law.  In determining whether an alleged agent has authority to receive process for a defendant, we “must look to the circumstances surrounding the relationship and find authority which is either express or implied from the type of relationship between the defendant and the alleged agent.”  Moore v. Simpson, 322 S.C. 518, 523, 473 S.E.2d 64, 67 (Ct. App. 1996).  Here, Myers has been employed by Appellant for approximately twenty years and regularly deals with the public.  Moreover, Myers, Appellant’s sole office employee, told the process server he was authorized to accept service.  These circumstances imply Myers was authorized to receive service.  Accordingly, we find the trial court committed no error in finding Respondent’s personal service on Myers was reasonably calculated to notify Appellant of the action.

AFFIRMED. [2]        

STILWELL, BEATTY, and SHORT, JJ., concur.


[1] We decide this case without oral argument pursuant to Rule 215, SCACR.

[2]   Appellant also asserts the circuit court erred by not relieving it from the Alabama judgment based on excusable neglect, the existence of a defense on the merits, and ostensible invalidity of the federal court’s default procedures.  These arguments are not available to a defendant who is collaterally attacking a foreign judgment.  Milliken, 311 U.S. at 462 (“[T]he full faith and credit clause of the Constitution precludes any inquiry into the merits of the cause of action, the logic or consistency of the decision, or the validity of the legal principles on which the judgment is based.”).  Because these issues are not properly before this Court, we do not address them.