WASTE MANAGEMENT, INC., ET AL. V. THE ADMIRAL INSURANCE COMPANY, ET AL.
Case Date: 10/13/1994
Docket No: SYLLABUS
|
(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for
the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please
note that, in the interests of brevity, portions of any opinion may not have been summarized).
WASTE MANAGEMENT, INC., ET AL. V. THE ADMIRAL INSURANCE COMPANY, ET AL. (A-9/10-93)
Argued September 28, 1993 -- Decided October 13, 1994
CLIFFORD, J., writing for a majority of the Court.
Waste Management, Inc., fifty-four of its subsidiaries, and a former subsidiary (plaintiffs) are
engaged in the disposal of solid- and hazardous-waste products. Various insurers of plaintiffs have denied
coverage for certain environmental damage claims made by customers, governmental agencies and others.
Plaintiffs brought a declaratory-judgment action to determine the insurers' liability for coverage of pollution-related damage at ninety-seven sites in twenty-two states and Canada. Seventeen of those sites are located in
New Jersey.
Among the 150 defendant-insurers are out-of-state carriers that have conducted no activities in New
Jersey and whose insurance policies, written elsewhere, contain no reference to New Jersey risks. Each of
the policies contain a "territory of coverage" clause, generally extending coverage to the United States and
Canada. Many of these out-of-state insurers brought motions to dismiss the declaratory-judgment action,
primarily on grounds of lack of personal jurisdiction and inconvenient forum. The trial court denied the
motions, finding that a "territory of coverage" clause in an insurance policy, without more, is a sufficient basis
on which to rest personal jurisdiction over a non-resident insurance carrier. The trial court also found that
New Jersey's "interest nexus" in resolving massive environmental insurance-coverage cases comprehensively
can, by itself, confer personal jurisdiction over foreign insurance carriers with no ties to New Jersey.
Five of the defendant-insurers sought leave to appeal to the Appellate Division. That motion was
denied. Thereafter, the Supreme Court granted these insurers' motions for leave to appeal the Appellate
Division's denial of leave to appeal the trial court's order concerning personal jurisdiction. The five carriers
have no connection with New Jersey, but their policies all contain "territory of coverage" clauses. Four of
those carriers, Canadian General Insurance Co., Commercial Union Insurance Co. of Canada, Royal
Insurance Co. of Canada, and Wellington Insurance Co. (the Canadian Insurers), do no business in New
Jersey, are not licensed to do business in New Jersey, and issued their respective policies only after
ascertaining that their insured conducted operations only in Canada. That insured, WMU Waste
Management of Canada, Inc. (Waste Management of Canada), is neither licensed to do business in New
Jersey nor involved in sites related to New Jersey. The sole site insured by the Canadian Insurers lies in
Ontario and is the subject of litigation in that province. The Canadian Insurers appeal the denial of their
motion to dismiss based on both lack of personal jurisdiction and inconvenient forum, contending that: 1) if
forced to defend in New Jersey on the coverage issue, they will lose the right to contest the resulting
judgment in Canadian court; 2) Canada is the appropriate forum because the insuring transaction and
insured event took place in Canada, where the site and the witnesses are located; and 3) subjecting them to
the cost and complexity of this litigation is unfair.
The fifth carrier, Auto Owners Insurance Co. (Auto Owners), contends only that New Jersey lacks
personal jurisdiction. Auto Owners is not authorized, licensed, or qualified to do business in New Jersey, nor
has it ever issued a policy to anyone living in New Jersey or insured any risks located in New Jersey. Auto
Owners is a Michigan corporation that issues policies to businesses that operate waste-disposal facilities and
conduct local waste-hauling activities in Michigan. On appeal, Auto Owners asserts that it has no minimum
contacts with New Jersey and that the "territory of coverage" clause does not by itself provide a basis for
jurisdiction.
HELD: In the absence of a forum-related event, a "territory of coverage" clause alone does not create a
sufficient basis on which to rest jurisdiction in New Jersey. Moreover, New Jersey's "interest
nexus" in resolving massive environmental insurance-coverage cases cannot serve as an
independent basis for the assertion of personal jurisdiction.
1. A court's jurisdiction is "specific" if a cause of action arises directly out of a defendant's contacts with
the forum state. "Minimum contacts" are the threshold requirements for specific personal jurisdiction.
Minimum contacts exist when a defendant purposely avails itself of the privilege of engaging in activities
within the forum state, thereby gaining the benefits and protections of the forum state's laws. Once
minimum contacts are established, it must be demonstrated that the maintenance of a suit against the
defendant does not offend traditional notions of fair play and substantial justice. Critical to that analysis is
the question whether the defendant should reasonably anticipate being brought into court in the forum state.
(pp. 10-13)
2. Once a court finds that a defendant has purposefully established minimum contacts within the forum
state, other factors, such as the State's interest in adjudicating the suit and the plaintiff's interest in obtaining
relief, may properly be weighed in determining whether those minimum contacts establish jurisdiction
consistent with considerations of fair play and substantial justice. (pp. 13-15)
3. Minimum contacts must be determined by a case-by-case analysis of a defendant's relationship with
the forum state. That analysis looks to whether minimum contacts exist at all and the weight and sufficiency
of the contacts. Sufficiency of contacts depends on the purposeful act of the defendant, not the unilateral
activity of another who merely claims a relationship to the defendant. Moreover, absent a duty to act,
"purposeful availment" of the privileges of a forum state cannot normally include what a non-resident
defendant has failed to do. In addition, if a suit contains multiple defendants, their individual contacts to the
forum state cannot be aggregated to find minimum contacts for a single defendant.
4. Neither the Canadian Insurers nor Auto Owners purposely availed themselves of some benefit of
doing business in New Jersey. Therefore, because no contacts exist between New Jersey and the defendants,
those defendants are not subject to New Jersey's personal jurisdiction. Because the threshold requirement of
minimum contacts is absent, the "fair play or substantial justice" issue need not be considered. (pp. 22-24)
5. The trial court's reliance on Ashley v. Abbott Laboratories, and Westinghouse Electric Corp. v.
Liberty Mutual Insurance Co. is misplaced. The requisite due-process analysis must focus primarily on
substantial justice and fundamental fairness, not on economy and convenience. Thus, New Jersey's "interest
nexus" cannot serve as an independent basis for the assertion of personal jurisdiction.
Judgment of the Appellate Division is VACATED and the matter is REMANDED to the Law
Division for entry there of judgment in favor of defendants-appellants.
JUSTICE O'HERN, concurring in the judgment, is of the view that the exercise of jurisdiction in
this case would offend traditional notions of fair play and substantial justice. However, Justice O'Hern
disagrees that a territory-of-coverage clause in an insurance policy is insufficient to establish minimum
contacts.
CHIEF JUSTICE WILENTZ and JUSTICES HANDLER, POLLOCK, GARIBALDI and STEIN
join in JUSTICE CLIFFORD'S opinion. JUSTICE O'HERN filed a separate concurring opinion.
SUPREME COURT OF NEW JERSEY
WASTE MANAGEMENT, INC., and its present and former subsidiaries, WASTE MANAGEMENT INC. OF FLORIDA; WASTE MANAGEMENT OF ALABAMA, INC.; WASTE MANAGEMENT OF ARIZONA, INC.; WASTE MANAGEMENT OF COLORADO, INC.; WASTE MANAGEMENT OF CONNECTICUT, INC.; WASTE MANAGEMENT OF DELAWARE, INC.; WASTE MANAGEMENT OF ILLINOIS, INC.; WASTE MANAGEMENT OF KENTUCKY, INC.; WASTE MANAGEMENT OF MAINE, INC.; WASTE MANAGEMENT OF MARYLAND, INC.; WASTE MANAGEMENT OF MASSACHUSETTS, INC.; WASTE MANAGEMENT OF MICHIGAN, INC.; WASTE MANAGEMENT OF NEW HAMPSHIRE, INC.; WASTE MANAGEMENT OF NEW YORK, INC.; WASTE MANAGEMENT OF NORTH AMERICA, INC.; WASTE MANAGEMENT OF OHIO, INC.; WASTE MANAGEMENT OF OKLAHOMA, INC.; WASTE MANAGEMENT OF PENNSYLVANIA, INC.; WASTE MANAGEMENT OF SOUTH CAROLINA, INC.; WASTE MANAGEMENT OF WISCONSIN, INC.; WMI SAFETY SERVICES, INC.; WMI WASTE MANAGEMENT OF CANADA INC.; CHEMICAL WASTE MANAGEMENT, INC.; CHEMICAL WASTE MANAGEMENT OF NEW JERSEY, INC.; CHEMICAL WASTE MANAGEMENT OF KANSAS, INC.; SCA SERVICES, INC.; SCA DISPOSAL SERVICES OF NEW ENGLAND, INC.; SCA SERVICES OF INDIANA, INC.; SCA SERVICES OF NEW JERSEY, INC.; SCA SERVICES OF PENNSYLVANIA, INC.; ALDERFER & FRANK, INC.; CARL GULICK, INC.; CHEM-NUCLEAR SYSTEMS, INC.; CLEAN HARBORS OF BRAINTREE, INC.; CWM CHEMICAL SERVICES, INC.; HAZCO INTERNATIONAL, INC.; INDIANA WASTE SYSTEMS, INC.; INSTANT DISPOSAL SERVICE, INC.; INTERSTATE WASTE REMOVAL CO., INC.; LANDFILL & DEVELOPMENT COMPANY; MICHIGAN LANDFILL HOLDINGS, INC.; MODERN TRASH REMOVAL OF YORK, INC.; NU-WAY TRASH REMOVAL CORP.; OHIO WASTE SYSTEMS, INC.; REFUSE SERVICES, INC.; RITE-WAY SERVICE INC.; S.C.R. SYSTEMS, INC.; SANITARY LANDFILL,
INC.; THE O'CONNOR CORPORATION;
WASTECONTROL OF FLORIDA, INC.;
WASTE DISPOSAL, INC.; WASTEQUID,
INC.; WASTE RESOURCES CORPORATION;
WASTE RESOURCES OF TAMPA BAY, INC.;
WM ACQUIRING CORP.,
Plaintiffs-Respondents,
v. THE ADMIRAL INSURANCE COMPANY, AETNA CASUALTY & SURETY COMPANY; AETNA CASUALTY COMPANY OF CANADA; ALLIANZ INSURANCE COMPANY; ALLIANZ UNDERWRITERS INSURANCE COMPANY; ALLSTATE INSURANCE COMPANY; AMERICAN CASUALTY COMPANY OF READING, PENNSYLVANIA; AMERICAN EMPIRE SURPLUS LINES INSURANCE COMPANY; AMERICAN EMPLOYERS' INSURANCE COMPANY; AMERICAN HOME ASSURANCE COMPANY; THE AMERICAN INSURANCE COMPANY; AMERICAN MOTORISTS INSURANCE COMPANY; AMERICAN NATIONAL FIRE INSURANCE COMPANY; AMERICAN POLICYHOLDERS' INSURANCE COMPANY; AMERICAN RE-INSURANCE COMPANY; ARGONAUT INSURANCE COMPANY; ASSOCIATED INDEMNITY CORPORATION; ASSOCIATED INTERNATIONAL INSURANCE COMPANY; BIRMINGHAM FIRE INSURANCE COMPANY OF PENNSYLVANIA; C.E. HEATH COMPENSATION AND LIABILITY INSURANCE COMPANY; CALIFORNIA UNION INSURANCE COMPANY; THE CAMDEN FIRE INSURANCE ASSOCIATION; THE CELINA MUTUAL INSURANCE COMPANY; CENTRAL NATIONAL INSURANCE COMPANY OF OMAHA; CENTURY INDEMNITY COMPANY; CHICAGO INSURANCE COMPANY; CIGNA PROPERTY AND CASUALTY INSURANCE COMPANY; COLUMBIA CASUALTY COMPANY; COMMERCIAL UNION INSURANCE COMPANY; CONSTITUTION STATE INSURANCE COMPANY; CONTINENTAL CASUALTY COMPANY; THE CONTINENTAL INSURANCE COMPANY; CRUM AND FORSTER INSURANCE COMPANY; EMPLOYERS INSURANCE OF WAUSAU A MUTUAL COMPANY; EMPLOYERS LIABILITY ASSURANCE CORPORATION, LIMITED; EMPLOYERS MUTUAL CASUALTY COMPANY; EMPLOYERS REINSURANCE CORPORATION; ERIC REINSURANCE COMPANY; EVANSTON INSURANCE COMPANY; FEDERAL INSURANCE COMPANY; THE FIDELITY AND CASUALTY COMPANY OF NEW YORK; FIREMAN'S FUND INSURANCE COMPANY; FIREMEN'S INSURANCE COMPANY OF NEWARK, NEW JERSEY; FIRST STATE INSURANCE COMPANY; FREMONT INDEMNITY COMPANY; GENERAL ACCIDENT INSURANCE COMPANY OF AMERICA; GENERAL CASUALTY COMPANY OF WISCONSIN; GIBRALTAR CASUALTY COMPANY; GLOBE INDEMNITY COMPANY; GRANITE STATE INSURANCE COMPANY; GREAT AMERICAN INSURANCE COMPANY; GULF INSURANCE COMPANY; THE HANOVER INSURANCE COMPANY; HARLEYSVILLE MUTUAL INSURANCE COMPANY; HARTFORD ACCIDENT AND INDEMNITY COMPANY; HARTFORD CASUALTY INSURANCE COMPANY; HIGHLANDS INSURANCE COMPANY; THE HOME INDEMNITY COMPANY; THE HOME INSURANCE COMPANY; HUDSON INSURANCE COMPANY; INDIANA INSURANCE COMPANY; INSURANCE COMPANY OF NORTH AMERICA; THE INSURANCE COMPANY OF THE STATE OF PENNSYLVANIA; INTERNATIONAL INSURANCE COMPANY; INTERNATIONAL SURPLUS LINES INSURANCE COMPANY; INTERSTATE FIRE & CASUALTY COMPANY; LEXINGTON INSURANCE COMPANY; LIBERTY MUTUAL INSURANCE COMPANY; MARYLAND CASUALTY COMPANY; NATIONAL AMERICAN INSURANCE COMPANY OF CALIFORNIA; NATIONAL FIRE INSURANCE COMPANY OF HARTFORD; NATIONAL GRANGE MUTUAL INSURANCE COMPANY; NATIONAL SURETY CORPORATION; NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA.; NEW ENGLAND INSURANCE COMPANY; NEW ENGLAND REINSURANCE CORP.; THE NORTH RIVER INSURANCE COMPANY; THE NORTHERN ASSURANCE COMPANY OF AMERICA; NORTHWESTERN NATIONAL INSURANCE COMPANY; THE OHIO CASUALTY INSURANCE COMPANY; OLD REPUBLIC INSURANCE COMPANY; PACIFIC EMPLOYERS INSURANCE COMPANY; PENNSYLVANIA MANUFACTURERS' ASSOCIATION INSURANCE COMPANY; PHOENIX ASSURANCE COMPANY OF NEW YORK; PLANET INSURANCE COMPANY; POTOMAC INSURANCE COMPANY OF ILLINOIS; PRUDENTIAL REINSURANCE COMPANY; PURITAN INSURANCE COMPANY; RANGER INSURANCE COMPANY; RELIANCE INSURANCE COMPANY; ROYAL INDEMNITY COMPANY; ROYAL INSURANCE COMPANY OF AMERICA; SAFETY NATIONAL CASUALTY COMPANY; SECURITY INSURANCE COMPANY OF HARTFORD; SELECTIVE INSURANCE COMPANY OF AMERICA; THE SHELBY INSURANCE COMPANY; STONEWALL INSURANCE COMPANY; ST. PAUL FIRE AND MARINE INSURANCE COMPANY; THE ST. PAUL INSURANCE COMPANY; ST. PAUL MERCURY INSURANCE COMPANY; ST. PAUL SURPLUS LINES INSURANCE COMPANY; TRANSAMERICA INSURANCE COMPANY; TRANSPORTATION INSURANCE COMPANY; THE TRAVELERS INDEMNITY COMPANY; THE TRAVELERS INDEMNITY COMPANY OF RI; TWIN CITY FIRE INSURANCE COMPANY; UNIGARD SECURITY INSURANCE COMPANY; UNITED FIRE & CASUALTY COMPANY; UNITED STATES FIDELITY AND GUARANTY COMPANY; UNITED STATES FIRE INSURANCE COMPANY; VANLINER INSURANCE COMPANY; ZURICH INSURANCE COMPANY (US); UNDERWRITERS AT LLOYDS, LONDON; AND OTHER COMPANIES, INCLUDING: ALLIANZ INTERNATIONAL INSURANCE COMPANY LIMITED; BELLEFONTE INSURANCE COMPANY; BERMUDA FIRE & MARINE INSURANCE COMPANY LIMITED; COMPAGNIE D'ASSURANCES MARITIMES AERIENNES & TERRESTRES, S.A.; DART INSURANCE COMPANY LIMITED; DOMINION INSURANCE COMPANY LIMITED; EL PASO INSURANCE COMPANY LIMITED; EXCESS INSURANCE COMPANY LIMITED; FOLKSAM INTERNATIONAL INSURANCE COMPANY (UK) LIMITED; HEDDINGTON INSURANCE COMPANY (UK) LIMITED; LEXINGTON INSURANCE COMPANY; LONDON AND EDINBURGH GENERAL INSURANCE COMPANY LIMITED; MENTOR INSURANCE COMPANY (UK) LIMITED; MUTUAL REINSURANCE
COMPANY LIMITED; NEW HAMPSHIRE
INSURANCE COMPANY; PACIFIC AND
GENERAL; SOUTHERN AMERICAN
INSURANCE COMPANY; SOVEREIGN MARINE
& GENERAL INSURANCE COMPANY
LIMITED; SOVEREIGN MARINE & GENERAL
INSURANCE COMPANY LIMITED "C" A/C;
SOVEREIGN MARINE & GENERAL
INSURANCE COMPANY LIMITED NO. 12
A/C; STOREBRAND INSURANCE COMPANY
(UK) LIMITED; STRONGHOLD INSURANCE
COMPANY LIMITED; ST. KATHERINE
INSURANCE COMPANY LIMITED; ST.
KATHERINE INSURANCE COMPANY LIMITED
(X A/C); TAISHO MARINE & FIRE
INSURANCE COMPANY (UK) LIMITED;
TERRA NOVA INSURANCE COMPANY; TERRA
NOVA INSURANCE COMPANY LIMITED;
TOKIO MARINE & FIRE INSURANCE
COMPANY (UK) LIMITED; TUREGUM
INSURANCE COMPANY; WALBROOK
INSURANCE COMPANY LIMITED;
WINTERTHUR SWISS INSURANCE COMPANY;
and YASUDA FIRE AND MARINE
INSURANCE COMPANY (UK) LIMITED,
Defendants,
and
AUTO-OWNERS INSURANCE COMPANY;
CANADIAN GENERAL INSURANCE COMPANY;
COMMERCIAL UNION ASSURANCE COMPANY
OF CANADA; ROYAL INSURANCE COMPANY
OF CANADA; and WELLINGTON INSURANCE
COMPANY;
Defendants-Appellants.
Argued September 28, 1993 -- Decided October 13, 1994
On appeal from the Superior Court, Appellate
Division.
John R. Casolaro, a member of the New York
bar, argued the cause for appellant Canadian
General Insurance Company and Eric
Proshansky, a member of the New York bar,
argued the cause for Wellington Insurance
Company (Pearson and Shapiro, attorneys for
Canadian General Insurance Company; Tenzer,
Greenblatt & Zunz, attorneys for Wellington
Insurance Company; Herrick, Feinstein,
attorneys for Commercial Union Assurance
Company of Canada and Wilson, Elser,
Moskowitz, Edelman & Dicker, attorneys for
Royal Insurance Company of Canada; Mr.
Casolaro, Mr. Proshansky, Ronald J. Levine,
Fredric H. Pearson, William P. Krauss and
Joseph C. Kaplan, on the joint letter
briefs).
John A. Yeager, a member of the Michigan bar,
argued the cause for appellant Auto Owners
Insurance Company (Haggerty, Donohue &
Monaghan, attorneys; Mr. Yeager and Walter E.
Monaghan on the brief).
David M. Jones, a member of the Massachusetts
bar, argued the cause for respondents (Kerby,
Cooper, English, Danis & Garvin, attorneys;
Mr. Jones and Jerry Fitzgerald English, on
the briefs).
Michael R. Magaril submitted a brief on
behalf of amicus curiae Township of West
Milford New Jersey (Anderson, Kill, Olick &
Oshinsky, attorneys).
Carol A. Stevens submitted a brief on behalf
of amici curiae The American Insurance
Association and The National Association of
Independent Insurers (Watson, Stevens,
Fiorilla & Rutter, attorneys).
The opinion of the Court was delivered by
On this interlocutory appeal, two rulings of the trial court
raise issues of first impression. In denying defense motions to
dismiss this declaratory-judgment action, the court held, first,
that a "territory of coverage" clause in an insurance policy,
without more, is a sufficient basis on which to rest in personam
jurisdiction over a nonresident insurance carrier. With that
holding the trial court became the only court in this or any
other jurisdiction to declare that a "territory of coverage"
clause standing alone confers jurisdiction over an alien insurer.
Second, the trial court held that New Jersey's "interest nexus"
in resolving massive environmental insurance-coverage cases
comprehensively can, by itself, confer personal jurisdiction over
foreign carriers with no ties whatsoever to this state.
Because we conclude that both holdings are erroneous, we
vacate the trial court's order and remand for entry of judgment
for defendants-appellants.
Plaintiffs are Waste Management, Inc., fifty-four of its
present subsidiaries, and one of its former subsidiaries. They
are engaged in the disposal of solid- and hazardous-waste
products. Plaintiffs are subject to environmental damage claims
by customers, governmental agencies, and others. Defendants,
various insurers of plaintiffs, have denied coverage for those
claims. Plaintiffs therefore brought this declaratory-judgment
action to establish liability coverage for pollution-related
damage at ninety-seven sites in twenty-two states and Canada.
Seventeen of those sites lie in New Jersey. Among the 150 defendant insurers are out-of-state carriers that have conducted no activities of any sort in New Jersey and whose policies, written elsewhere, contain no reference to New
Jersey risks. Each of the policies, however, contains a
"territory of coverage" clause, generally extending coverage to
the United States and Canada. Examples of such clauses are:
"The policy applies only to bodily injury or property damage
* * * [that] occurs during the policy term as stated in the
Declarations within the United States of America, its territories
or possessions, Canada or Mexico * * * ," and "This policy covers
only within Canada and the Continental Limits of the United
States of America (excluding Alaska)."
Many of the out-of-state insurers brought motions to have
the declaratory-judgment action dismissed, principally on grounds
of lack of personal jurisdiction and forum non conveniens. When
the trial court denied the motions to dismiss, five of the
defendant insurers sought leave to appeal to the Appellate
Division, which that court denied. We granted leave to appeal,
133 N.J. 414-15 (1993). The five carriers before us on this appeal have no connection with New Jersey, but their policies all contain "territory of coverage" clauses providing liability coverage for losses occurring in the United States or Canada. Four of those carriers are referred to as the Canadian Insurers: Canadian General Insurance Company, Commercial Union Assurance Company of Canada, Royal Insurance Company of Canada, and Wellington Insurance Company. The Canadian Insurers do no business in New
Jersey, are not licensed to do business in New Jersey, and claim
that they issued their respective policies only after
ascertaining that their single insured in this litigation
conducted operations in Canada alone. That insured, WMU Waste
Management of Canada, Inc. (Waste Management of Canada), is
neither licensed to do business in New Jersey nor involved in
sites related to New Jersey. The sole site insured by the
Canadian Insurers lies in Ontario and is the subject of
litigation in that province's Supreme Court. Waste Management of
Canada seeks, as part of this suit in New Jersey, a declaration
that the Canadian Insurers are liable for any judgment entered by
the Supreme Court of Ontario.
The Canadian Insurers appeal the denial of their motions to
dismiss on both the jurisdiction and forum non conveniens issues.
They argue that they will suffer irreparable injury, as
contemplated by Rule 2:2-2(b) governing interlocutory appeals to
this Court, if the decision below is sustained. They contend
that if forced to defend in New Jersey on the coverage issue,
they will lose the right to contest the resulting judgment in
Canadian courts; that Canada is the appropriate forum because the
insuring transaction and any insured event took place in Canada,
where the site and the witnesses are located; and that subjecting
them to the cost and complexity of this tangled litigation is
unfair.
The fifth carrier on this appeal, Auto Owners Insurance
Company (Auto Owners), raises only the claim that New Jersey
courts lack jurisdiction over it. Auto Owners is not authorized,
licensed, or qualified to do business in New Jersey, nor has it
ever issued a policy to a New Jersey domiciliary or insured any
risks located in this state. It is a Michigan corporation that
issued policies to businesses that operate waste-disposal
facilities and conduct local waste-hauling activities in
Michigan. It asserts that it has no minimum contacts with New
Jersey and that the "territory of coverage" clause does not by
itself afford a basis of jurisdiction.
The basic question is whether the trial court's
determination that New Jersey has personal jurisdiction over
these defendants runs afoul of due-process considerations. Our
discussion of that issue starts with a restatement of some
fundamental propositions. If a cause of action arises directly out of a defendant's contacts with the forum state, the court's jurisdiction is "specific." Lebel v. Everglades Marina, Inc., 115 N.J. 317, 322 (1989). If, however, the suit is not related directly to the defendant's contacts with the forum state, but is based instead
on the defendant's continuous and systematic activities in the
forum, then the State's exercise of jurisdiction is "general."
Id. at 323; see also Helicopteros Nacionales de Colum., S.A. v.
Hall,
466 U.S. 408, 414 n.9,
104 S. Ct. 1868, 1872 n.9, 80
L. Ed.2d 404, 411 n.9 (1984) (discussing general jurisdiction).
In Hanson v. Denckla,
357 U.S. 235, 251,
78 S. Ct. 1228,
1238,
2 L. Ed.2d 1283, 1296 (1958), the Supreme Court, striking
down an exercise of personal jurisdiction over out-of-state
defendants, pointed to a shift from the rigid rule of Pennoyer v.
Neff,
95 U.S. 714,
24 S. Ct. 565,
24 L. Ed. 565 (1878), which had
required actual presence in a state, to a more flexible standard
of "minimum contacts" under International Shoe v. Washington,
326 U.S. 310,
66 S. Ct. 154,
90 L. Ed. 95 (1945). "Minimum contacts"
are the threshold requirements for specific personal
jurisdiction. Hanson, supra, 357 U.S. at 253, 78 S. Ct. at 1239-40, 2 L. Ed.
2d at 1298. "[I]t is essential that there be some
act by which the defendant purposefully avails itself of the
privilege of conducting activities within the forum state, thus
invoking the benefit and protection of its laws." Id. at 253, 78
S. Ct. at 1240, 2 L. Ed.
2d at 1298 (citing International Shoe,
supra, 326 U.S. at 319, 66 S. Ct. at 159, 90 L. Ed. at 103). In World-Wide Volkswagen v. Woodson, 444 U.S. 286, 100 S. Ct. 559, 62 L. Ed.2d 490 (1980), the Supreme Court clarified the purposes of the "minimum contacts" doctrine: to protect a
defendant against litigating in an inconvenient forum and to
ensure that States not exceed their jurisdictional limits under
our federal system. Id. at 291-92, 100 S. Ct. at 564, 62
L. Ed.
2d at 498. The first interest, that of ensuring against
litigating in inconvenient forums, requires that "maintenance of
the suit '* * * not offend "traditional notions of fair play and
substantial justice."'" Id. at 292, 100 S. Ct. at 564, 62
L. Ed.
2d at 498 (quoting International Shoe, supra, 326 U.S. at
316, 66 S. Ct. at 154, 90 L. Ed. at 102 (quoting Milliken v.
Meyer,
311 U.S. 457, 463,
61 S. Ct. 339, 342,
85 L. Ed. 278, 283
(1940))). That end is achieved through the requirement that
"[t]he relationship between the defendant and the forum * * * be
such that it is 'reasonable * * * to require the corporation to
defend the particular suit which is brought there.'" Ibid.
(quoting International Shoe, supra, 326 U.S. at 317, 66 S. Ct. at
158, 90 L. Ed. at 102 (omission in original)). The second
interest, the jurisdictional limitations, "has been relaxed
substantially over the years" because of the "fundamental
transformation in the American economy." Id. at 292-93, 100
S. Ct. at 565, 62 L. Ed.
2d at 498. Nonetheless, minimum
contacts remain the threshold requirement of jurisdiction. Id.
at 294, 100 S. Ct. at 565-66, 62 L. Ed.
2d at 499-500. Critical to the due-process analysis is the question whether the defendant should reasonably anticipate being haled into court in the forum state. Burger King Corp. v. Rudzewicz, 471 U.S.
462, 474,
105 S. Ct. 2174, 2183,
85 L. Ed.2d 528, 542 (1985).
The record must demonstrate that the defendant has purposefully
availed itself of the privilege of engaging in activities within
the forum state, thereby gaining the benefits and protections of
its laws. Id. at 475, 105 S. Ct. at 2183, 85 L. Ed.
2d at 542.
In that way defendants are protected against being haled into
court in a foreign jurisdiction solely on the basis of random,
fortuitous, or attenuated contacts or as a result of the
unilateral activity of some other party. Ibid.
Once the court finds that a defendant has purposefully
established minimum contacts within the forum state, other
factors, such as the State's interests in adjudicating the suit
and the plaintiff's interest in obtaining relief, may properly be
weighed in determining whether those minimum contacts establish
jurisdiction consistent with considerations of fair play and
substantial justice. Those considerations may even "serve to
establish the reasonableness of jurisdiction upon a lesser
showing of jurisdiction than would otherwise be required." Id.
at 477, 105 S. Ct. at 2184, 85 L. Ed.
2d at 543-44. However, a
court may not weigh those other factors until it has found that
the defendant has experienced sufficient minimum contacts to
satisfy the threshold determination. In Burger King, the Supreme Court considered whether a "contract with an out-of-state party alone can automatically
establish sufficient minimum contacts in the other party's
forum." 417 U.S. at 478, 105 S. Ct. at 2185, 85 L. Ed.
2d at
545. "[T]he answer," the Court declared, "clearly is that it
cannot." Ibid. That answer is based on the fact that a contract
is "'ordinarily but an intermediate step serving to tie up prior
business negotiations with future consequences which themselves
are the real object of the business transaction.'" Id. at 479,
105 S. Ct. at 2185, 85 L. Ed.
2d at 545 (quoting Hoopeston
Canning Co. v. Cullen,
318 U.S. 313, 317,
63 S. Ct. 602, 604-05,
87 L. Ed. 777, 782 (1943)). Thus, "in determining whether the
defendant purposefully established minimum contacts with the
forum," courts must consider such factors as "prior negotiations
and contemplated future consequences, along with the terms of the
contract and the parties' actual course of dealing." Id. at 479,
105 S. Ct. at 2185, 85 L. Ed.
2d at 545.
In Asahi Metal Industry Co. v. Superior Court of California,
480 U.S. 102,
107 S. Ct. 1026,
94 L. Ed.2d 92 (1987), the
Supreme Court affirmed the rule that the substantial connection
between the defendant and the forum state necessary for a finding
of minimum contacts "must come about by an action of the
defendant purposefully directed toward the forum State." Id. at
112, 107 S. Ct. at 1032, 94 L. Ed.
2d at 104. The Court also
listed several factors for courts to evaluate when determining
the reasonableness of an exercise of jurisdiction: the burden on
the defendant, the interests of the forum state, the plaintiff's
interest in obtaining relief, the interstate judicial system's
interest in efficient resolution of controversies, and the shared
interest of the States in furthering fundamental substantive
social policies. Id. at 113, 107 S. Ct. at 1033, 94 L. Ed.
2d at
105. Moreover, when the suit involves an alien defendant, a
court must be "unwilling[] to find the serious burdens on an
alien defendant outweighed by minimal interests on the part of
the plaintiff or the forum State." Id. at 115, 107 S. Ct. at
1034, 94 L. Ed.
2d at 106.
Ensuring that an application of the minimum-contacts test satisfies the jurisdictional requirement of due process calls for a case-by-case analysis of a defendant's relationship with the forum state. Charles Gendler & Co. v. Telcom Equip. Corp., 102 N.J. 460, 470 (1986). That analysis has two parts. The first is to determine whether minimum contacts exist at all. That first step "ensures that a state's grasp does not exceed its jurisdictional reach," and, in doing so, protects the primary interest of the restriction: preserving "the defendant's liberty interest in not being subject to the entry of a judgment in a jurisdiction with which the defendant does not have sufficient minimum contacts." Ibid. The second part of the analysis is to weigh "the sufficiency of the contacts for jurisdictional
purposes[, which] depends on 'the relationship among the
defendant, the forum, and the litigation * * * .'" Id. at 471
(quoting Shaffer v. Heitner,
433 U.S. 186, 204,
97 S. Ct. 2569,
2580,
53 L. Ed.2d 683, 698 (1977) (omission in original)).
The sufficiency of those contacts depends on "the purposeful
act of the defendant, not the unilateral activity of another who
merely claims a relationship to the defendant." Ibid. In
weighing the sufficiency of the contacts, this Court considers
whether the cause of action arose out of the defendant's contacts
within this State. If the two are related, the contacts support
the exercise of jurisdiction. Ibid. If the cause of action is
unrelated to the contacts, "the defendant's contacts must be so
continuous and substantial as to justify subjecting the defendant
to jurisdiction." Id. at 472. The more the defendant has
purposefully directed its activities to the forum state, and the
greater the benefits it has received from its contacts with the
forum state, the more reasonable the exercise of jurisdiction
becomes. Id. at 473. The Supreme Court has established a trend of "'expanding the permissible scope of state jurisdiction over foreign corporations and other nonresidents.'" Ibid. (quoting McGee v. International Life Ins. Co., 355 U.S. 220, 222, 78 S. Ct. 199, 201, 2 L. Ed 2d 223, 226 (1957)). "Focusing on the foreseeability of being haled into court," id. at 475, the Court adopted the stream-of-commerce
theory as an "independent basis to satisfy the minimum-contacts
standard." Id. at 476. In Gendler, we adopted that theory,
noting that it would not subject local retailers and distributors
to foreign jurisdiction, because unlike the markets of major
distributors, the local operators' foreseeable market is
constrained. Id. at 477. Moreover, a defendant that "prohibits
distribution of its products in a particular state would not
reasonably expect its products to be sold in that state," id. at
481, and would therefore not be subject to the jurisdiction of
that state on a stream-of-commerce theory. If, however, the minimum-contacts threshold is met through the actions of the defendant without regard to the plaintiff's unilateral activities, a court, in considering the relationship between the defendant, the forum, and the litigation, may then consider the plaintiff's residence in the forum state to determine whether the defendant's contacts to that forum state justify an exercise of jurisdiction. In Lebel, supra, we found that a Florida seller of a luxury boat became subject to this State's jurisdiction when he telephoned his New Jersey buyer, mailed the contract of sale to New Jersey, and received payment from New Jersey. We concluded that those facts supported an exercise of specific jurisdiction over that sale, because "the defendant purposely directed his activities at the forum state." 115 N.J. at 327. Thus, we held that a "'plaintiff's residence in the forum may, because of defendant's relationship with the
plaintiff, enhance the defendant's contacts with the forum.'"
Id. at 327 (quoting Keeton v. Hustler Magazine, Inc.,
465 U.S. 770, 780,
104 S. Ct. 1473, 1481,
79 L. Ed.2d 790, 801 (1984)).
Such a finding of enhancement of defendant's contacts must
be based on the relationship of the plaintiff's residence in the
forum state to the transaction with the defendant that gives rise
to the suit -- that is, the defendant must avail itself of the
plaintiff's residence in the transaction. Put differently, the
defendant must be aware that the transaction "will have direct
consequences in [the forum state] such that it should [be] aware
of the possibility of litigation arising in that forum." Id. at
328. In measuring the defendant's expectations concerning that
possibility, we consider the facts of the case under the World-Wide Volkswagen standard of reasonable anticipation of being
haled into court. See Lebel, supra, 115 N.J. at 330. Once the defendant is found to have minimum contacts to the forum, "the 'fair play and substantial justice' inquiry must still be made." Id. at 328. That inquiry places the burden on the defendant to make a "'compelling case'" that some consideration makes the exercise of jurisdiction unreasonable. Ibid. (quoting Burger King, supra, 471 U.S. at 477, 105 S. Ct. at 2184, 85 L. Ed. 2d at 544). In Lebel, we gave as examples of such considerations the factors listed in Asahi, supra, 480 U.S. at 113, 107 S. Ct. at 1034, 94 L. Ed. 2d at 105: the burden on
the defendant, the interests of the forum state, the plaintiff's
interest in obtaining relief, the interstate judicial system's
interest in efficient resolution of disputes, and the shared
interest of the states in furthering fundamental substantive
social policies. We further observed that the burden of a
defendant coming to the plaintiff's state, as opposed to the
plaintiff going to the defendant's home state, is too slight an
imbalance to defeat jurisdiction. Id. at 328-29. As the
Appellate Division has properly noted, "In actions based on
contract, plaintiff's selection of forum will not be disturbed
except in the most exceptional of circumstances, in recognition
of the fact that such transactions have 'evidential roots in
several jurisdictions.'" Star Video Entertainment v. Video
U.S.A. Assocs.,
253 N.J. Super. 216, 226-27 (1992) (citation
omitted) (quoting Starr v. Berry,
25 N.J. 573, 587 (1958)). In
those suits based on contract in which the defendant has minimum
contacts to the forum state, we look to whether the forum is
manifestly inappropriate or chosen for purposes of vexation or
harassment. Id. at 227.
The Supreme Court cases discussed above reveal a common thread in their factual determinations on the existence of minimum contacts. In Hanson, supra, the Court ruled that no
minimum contacts with Florida existed when the defendant, an
administrator of a trust, had no offices or trust assets and did
no business or solicitation in Florida. 357 U.S. at 251, 78 The foregoing cases demonstrate that the existence of minimum contacts turns on the presence or absence of intentional acts of the defendant to avail itself of some benefit of a forum
state. An intentional act calculated to create an actionable
event in a forum state will give that state jurisdiction over the
actor. Calder v. Jones,
465 U.S. 783, 791,
104 S. Ct. 1482,
1488,
79 L. Ed.2d 804, 813 (1984) (publishing libelous article
in magazine sold in California, and causing greatest degree of
harm in California, gave that state jurisdiction over reporter
and editor). A defendant may constructively consent to the
personal jurisdiction of a state court through voluntary use of
certain procedures of that state. Insurance Corp. of Ire. v.
Compagnie des Bauxites de Guinea,
456 U.S. 694, 704,
102 S. Ct. 2099, 2105,
72 L. Ed.2d 492, 502 (1982). Jurisdiction may be
created through a contract that has substantial connections to
the forum state. McGee, supra, 355 U.S. at 223, 78 S. Ct. at
201, 2 L. Ed.
2d at 226 (holding that insurance contract
delivered in California to a California resident, and premiums
mailed from California created sufficient contacts to support
finding of jurisdiction on contract). Similarly, an arbitration
clause evidences consent to in personam jurisdiction for orders
compelling arbitration. Victory Transp. Inc. v. Comisaria Gen.,
336 F.2d 354, 363 (2d Cir. 1964). However, not every act of a potential defendant is sufficient to satisfy the jurisdictional requirement of intentional availment. "[M]ere purchases, even if occurring at regular intervals, are not enough to warrant a State's assertion of jurisdiction over a nonresident [defendant] in a cause of
action not related to those purchase transactions."
Helicopteros, supra, 466 U.S. at 418, 104 S. Ct. at 1874, 80
In light of the foregoing analysis, we consider the Canadian Insurers' and Auto Owners' contacts to New Jersey. The Canadian Insurers engage in no activity in this state, are not licensed to do business in New Jersey, and they insured Waste Management of Canada only after ascertaining that their insured had no operations in this country. The sole connection to New Jersey found by the trial court was the "territory of coverage" clause contained in the Canadian Insurers' contracts. We hold that in the absence of a forum-related event, a "territory of coverage" clause alone does not create a sufficient basis on which to rest jurisdiction in this state. See, e.g., Farmers Ins. Exch. v. Portage La Prairie Mut. Ins. Co., 907 F.2d 911, 913-14 (9th Cir. 1990); Rossman v. State Farm Mut. Auto Ins. Co., 832 F.2d 282, 286 (4th Cir. 1987); Commonwealth of Puerto Rico v. The SS Zoe Colocotroni, 628 F.2d 652, 668 (1st Cir. 1980); Batton v. Tennessee Farmers Mut. Ins. Co., 736 P.2d 2, 6 (Ariz. 1987); Meyer v. Auto Club Ins. Ass'n, 492 So.2d 1314, 1316 (Fla. 1986); Guardian Royal Exch. Assurance v. English China Clays, P.L.C., 815 S.W.2d 223, 227 (Tex. 1991). We recognize both the trend to expand the scope of jurisdiction over nonresidents and the special interest that a state may have in the field of insurance, see Avdel Corp. v. Mecure, 58 N.J. 264, 272 (1971), but those circumstances do not obviate the need to meet the threshold requirement for personal jurisdiction, namely, that the defendant create minimum contacts with this state by purposefully availing itself of some benefit of doing business here. Because no contacts exist between New Jersey and the Canadian Insurers, those defendants cannot be made subject to this State's personal
jurisdiction. We therefore do not reach the "fair play and
substantial justice" inquiry.
Similarly, we find no contacts by defendant Auto Insurers
with New Jersey. As with the Canadian Insurers, Auto Insurers
has insured entities that have no connection of their own to this
state. Its insureds' sole tie to New Jersey is their parent
conglomerate. That does not satisfy the requirement of the
insurer's purposeful availment of the benefits and privileges of
doing business in New Jersey. Because we again conclude that the
threshold requirement of minimum contacts is absent, we do not
consider whether jurisdiction could be exercised consistent with
"traditional notions of fair play and substantial justice." As a
result, our state courts may not exercise jurisdiction over
defendant Auto Insurers.
We need not dwell at length on the trial court's alternative basis for finding jurisdiction over these non-domiciliary defendants, namely, that even without a "territory of coverage" clause, New Jersey courts could assert in personam jurisdiction over nonresident insurers on the basis of this State's interest in not fragmenting massive litigation. According to the court, the contact establishing a "substantial connection" with the forum state is New Jersey's interest "in providing effective
means of redress for its residents when the insurers refuse to
pay claims." Even assuming the validity of the trial court's
theory, plaintiffs-insureds in this action against defendants-appellants are all nonresidents seeking coverage for
environmental damage occurring beyond New Jersey's borders.
Moreover, the rulings of the Supreme Court and of this Court, as
discussed above, require at least some minimum contact of the
defendant with the forum asserting in personam jurisdiction.
The trial court's reliance on the ruling of the federal
district court in Ashley v. Abbott Laboratories,
789 F. Supp. 548
(E.D.N.Y. 1992) (hereinafter DES Cases), for a contrary result is
misplaced. In that case, the court fashioned a progressive
jurisdictional approach to find nonresident manufacturers of the
drug diethylstilbestrol (DES) amenable to a massive products-liability action brought in New York. The DES Cases test for
mass torts requires a determination of whether the forum has an
appreciable interest in the litigation and, if so, whether the
defendant would experience a relatively substantial hardship were
it required to defend in the forum state. Id. at 587. Comparing
the massive insurance-coverage case before us to a mass-tort
case, the trial court ruled that "sound judicial policy"
justified application of the DES Cases test to insurance
coverage cases "since it is in the coverage cases that relief
affects not only the tort claimant, but also the insureds."
The trial court's analogy breaks down in several critical
areas. DES Cases was premised on the existence of a uniform tort
of massive proportions involving a single generic product, DES,
with a uniform mechanism of injury. Here, each insurer's
liability will be governed by the specific terms of its own
contracts of insurance. Second, without DES Cases' unprecedented
jurisdictional formulation, harm caused to New York residents
because of exposure to DES during pregnancy in all likelihood
would have gone unremedied because no other forum embraced the
"market share" theory of product liability, as developed by the
New York Court of Appeals in Hymowitz v. Eli Lilly & Co.,
539 N.E.2d 1069, cert. denied,
493 U.S. 944,
110 S. Ct. 350,
107 L. Ed.2d 338 (1989). DES Cases, supra, 789 F. Supp. at 576.
Accordingly, the DES Cases' holding was limited strictly to
actions brought by New York plaintiffs for injuries occurring in
New York. Id. at 569.
In this case, other, perhaps even more appropriate, forums
were available to the nonresident plaintiffs had they chosen to
litigate the coverage claims separately. Most significantly, the
court in DES Cases, despite its rejection of traditional "minimum
contacts" analysis, rested its holding to a large extent on the
theory that the nonresident DES manufacturers were participants
and derived benefits from a national DES market whose alleged
harms to plaintiffs in a major market segment (New York) were
reasonably foreseeable to the defendants.
The requisite due-process analysis must focus principally on substantial justice and fundamental fairness, not on economy and
convenience. New Jersey's "interest nexus" therefore cannot
serve as an independent basis for assertion of in personam
jurisdiction.
In light of our disposition of the jurisdiction issue, we do
not reach the Canadian Insurers' claim that they are entitled to
a dismissal on grounds of forum non conveniens, the merits of
which we perceive to be flimsy at best. See D'Agostino v.
Johnson & Johnson,
115 N.J. 491, 495-97 (1989); Westinghouse
Elec. Corp., supra, 233 N.J. Super. at 469-70.
The order of the trial court is vacated and the cause
remanded to the Law Division for entry there of a judgment of
dismissal in favor of defendants-appellants.
Chief Justice Wilentz and Justices Handler, Pollock,
Garibaldi, and Stein join in this opinion. Justice O'Hern has
filed a separate concurring opinion.
TO BE FILED 10/6/94
WASTE MANAGEMENT, INC., and its present and former subsidiaries, WASTE MANAGEMENT INC. OF FLORIDA; WASTE MANAGEMENT OF ALABAMA, INC.; WASTE MANAGEMENT OF ARIZONA, INC.; WASTE MANAGEMENT OF COLORADO, INC.; WASTE MANAGEMENT OF CONNECTICUT, INC.; WASTE MANAGEMENT OF DELAWARE, INC.; WASTE MANAGEMENT OF ILLINOIS, INC.; WASTE MANAGEMENT OF KENTUCKY, INC.; WASTE MANAGEMENT OF MAINE, INC.; WASTE MANAGEMENT OF MARYLAND, INC.; WASTE MANAGEMENT OF MASSACHUSETTS, INC.; WASTE MANAGEMENT OF MICHIGAN, INC.; WASTE MANAGEMENT OF NEW HAMPSHIRE, INC.; WASTE MANAGEMENT OF NEW YORK, INC.; WASTE MANAGEMENT OF NORTH AMERICA, INC.; WASTE MANAGEMENT OF OHIO, INC.; WASTE MANAGEMENT OF OKLAHOMA, INC.; WASTE MANAGEMENT OF PENNSYLVANIA, INC.; WASTE MANAGEMENT OF SOUTH CAROLINA, INC.; WASTE MANAGEMENT OF WISCONSIN, INC.; WMI SAFETY SERVICES, INC.; WMI WASTE MANAGEMENT OF CANADA INC.; CHEMICAL WASTE MANAGEMENT, INC.; CHEMICAL WASTE MANAGEMENT OF NEW JERSEY, INC.; CHEMICAL WASTE MANAGEMENT OF KANSAS, INC.; SCA SERVICES, INC.; SCA DISPOSAL SERVICES OF NEW ENGLAND, INC.; SCA SERVICES OF INDIANA, INC.; SCA SERVICES OF NEW JERSEY, INC.; SCA SERVICES OF PENNSYLVANIA, INC.; ALDERFER & FRANK, INC.; CARL GULICK, INC.; CHEM-NUCLEAR SYSTEMS, INC.; CLEAN HARBORS OF BRAINTREE, INC.; CWM CHEMICAL SERVICES, INC.; HAZCO INTERNATIONAL, INC.; INDIANA WASTE SYSTEMS, INC.; INSTANT DISPOSAL SERVICE, INC.; INTERSTATE WASTE REMOVAL CO., INC.; LANDFILL & DEVELOPMENT COMPANY; MICHIGAN LANDFILL HOLDINGS, INC.; MODERN TRASH REMOVAL OF YORK, INC.; NU-WAY TRASH REMOVAL CORP.; OHIO WASTE SYSTEMS, INC.; REFUSE SERVICES,
INC.; RITE-WAY SERVICE INC.; S.C.R.
SYSTEMS, INC.; SANITARY LANDFILL,
INC.; THE O'CONNOR CORPORATION;
WASTECONTROL OF FLORIDA, INC.;
WASTE DISPOSAL, INC.; WASTEQUID,
INC.; WASTE RESOURCES CORPORATION;
WASTE RESOURCES OF TAMPA BAY, INC.;
WM ACQUIRING CORP.,
Plaintiffs-Respondents,
v. THE ADMIRAL INSURANCE COMPANY, AETNA CASUALTY & SURETY COMPANY; AETNA CASUALTY COMPANY OF CANADA; ALLIANZ INSURANCE COMPANY; ALLIANZ UNDERWRITERS INSURANCE COMPANY; ALLSTATE INSURANCE COMPANY; AMERICAN CASUALTY COMPANY OF READING, PENNSYLVANIA; AMERICAN EMPIRE SURPLUS LINES INSURANCE COMPANY; AMERICAN EMPLOYERS' INSURANCE COMPANY; AMERICAN HOME ASSURANCE COMPANY; THE AMERICAN INSURANCE COMPANY; AMERICAN MOTORISTS INSURANCE COMPANY; AMERICAN NATIONAL FIRE INSURANCE COMPANY; AMERICAN POLICYHOLDERS' INSURANCE COMPANY; AMERICAN RE-INSURANCE COMPANY; ARGONAUT INSURANCE COMPANY; ASSOCIATED INDEMNITY CORPORATION; ASSOCIATED INTERNATIONAL INSURANCE COMPANY; BIRMINGHAM FIRE INSURANCE COMPANY OF PENNSYLVANIA; C.E. HEATH COMPENSATION AND LIABILITY INSURANCE COMPANY; CALIFORNIA UNION INSURANCE COMPANY; THE CAMDEN FIRE INSURANCE ASSOCIATION; THE CELINA MUTUAL INSURANCE COMPANY; CENTRAL NATIONAL INSURANCE COMPANY OF OMAHA; CENTURY INDEMNITY COMPANY; CHICAGO INSURANCE COMPANY; CIGNA PROPERTY AND CASUALTY INSURANCE COMPANY; COLUMBIA CASUALTY COMPANY; COMMERCIAL UNION INSURANCE COMPANY; CONSTITUTION STATE INSURANCE COMPANY; CONTINENTAL CASUALTY COMPANY; THE CONTINENTAL INSURANCE COMPANY; CRUM AND FORSTER INSURANCE COMPANY; EMPLOYERS INSURANCE OF WAUSAU A MUTUAL COMPANY; EMPLOYERS LIABILITY ASSURANCE CORPORATION, LIMITED; EMPLOYERS MUTUAL CASUALTY COMPANY; EMPLOYERS REINSURANCE CORPORATION; ERIC REINSURANCE COMPANY; EVANSTON INSURANCE COMPANY; FEDERAL INSURANCE COMPANY; THE FIDELITY AND CASUALTY COMPANY OF NEW YORK; FIREMAN'S FUND INSURANCE COMPANY; FIREMEN'S INSURANCE COMPANY OF NEWARK, NEW JERSEY; FIRST STATE INSURANCE COMPANY; FREMONT INDEMNITY COMPANY; GENERAL ACCIDENT INSURANCE COMPANY OF AMERICA; GENERAL CASUALTY COMPANY OF WISCONSIN; GIBRALTAR CASUALTY COMPANY; GLOBE INDEMNITY COMPANY; GRANITE STATE INSURANCE COMPANY; GREAT AMERICAN INSURANCE COMPANY; GULF INSURANCE COMPANY; THE HANOVER INSURANCE COMPANY; HARLEYSVILLE MUTUAL INSURANCE COMPANY; HARTFORD ACCIDENT AND INDEMNITY COMPANY; HARTFORD CASUALTY INSURANCE COMPANY; HIGHLANDS INSURANCE COMPANY; THE HOME INDEMNITY COMPANY; THE HOME INSURANCE COMPANY; HUDSON INSURANCE COMPANY; INDIANA INSURANCE COMPANY; INSURANCE COMPANY OF NORTH AMERICA; THE INSURANCE COMPANY OF THE STATE OF PENNSYLVANIA; INTERNATIONAL INSURANCE COMPANY; INTERNATIONAL SURPLUS LINES INSURANCE COMPANY; INTERSTATE FIRE & CASUALTY COMPANY; LEXINGTON INSURANCE COMPANY; LIBERTY MUTUAL INSURANCE COMPANY; MARYLAND CASUALTY COMPANY; NATIONAL AMERICAN INSURANCE COMPANY OF CALIFORNIA; NATIONAL FIRE INSURANCE COMPANY OF HARTFORD; NATIONAL GRANGE MUTUAL INSURANCE COMPANY; NATIONAL SURETY CORPORATION; NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA.; NEW ENGLAND INSURANCE COMPANY; NEW ENGLAND REINSURANCE CORP.; THE NORTH RIVER INSURANCE COMPANY; THE NORTHERN ASSURANCE COMPANY OF AMERICA; NORTHWESTERN NATIONAL INSURANCE COMPANY; THE OHIO CASUALTY INSURANCE COMPANY; OLD REPUBLIC INSURANCE COMPANY; PACIFIC EMPLOYERS INSURANCE COMPANY; PENNSYLVANIA MANUFACTURERS' ASSOCIATION INSURANCE COMPANY; PHOENIX ASSURANCE COMPANY OF NEW YORK; PLANET INSURANCE COMPANY; POTOMAC INSURANCE COMPANY OF ILLINOIS; PRUDENTIAL REINSURANCE COMPANY; PURITAN INSURANCE COMPANY; RANGER INSURANCE COMPANY; RELIANCE INSURANCE COMPANY; ROYAL INDEMNITY COMPANY; ROYAL INSURANCE COMPANY OF AMERICA; SAFETY NATIONAL CASUALTY COMPANY; SECURITY INSURANCE COMPANY OF HARTFORD; SELECTIVE INSURANCE COMPANY OF AMERICA; THE SHELBY INSURANCE COMPANY; STONEWALL INSURANCE COMPANY; ST. PAUL FIRE AND MARINE INSURANCE COMPANY; THE ST. PAUL INSURANCE COMPANY; ST. PAUL MERCURY INSURANCE COMPANY; ST. PAUL SURPLUS LINES INSURANCE COMPANY; TRANSAMERICA INSURANCE COMPANY; TRANSPORTATION INSURANCE COMPANY; THE TRAVELERS INDEMNITY COMPANY; THE TRAVELERS INDEMNITY COMPANY OF RI; TWIN CITY FIRE INSURANCE COMPANY; UNIGARD SECURITY INSURANCE COMPANY; UNITED FIRE & CASUALTY COMPANY; UNITED STATES FIDELITY AND GUARANTY COMPANY; UNITED STATES FIRE INSURANCE COMPANY; VANLINER INSURANCE COMPANY; ZURICH INSURANCE COMPANY (US); UNDERWRITERS AT LLOYDS, LONDON; AND OTHER COMPANIES, INCLUDING: ALLIANZ INTERNATIONAL INSURANCE COMPANY LIMITED; BELLEFONTE INSURANCE COMPANY; BERMUDA FIRE & MARINE INSURANCE COMPANY LIMITED; COMPAGNIE D'ASSURANCES MARITIMES AERIENNES & TERRESTRES, S.A.; DART INSURANCE COMPANY LIMITED; DOMINION INSURANCE COMPANY LIMITED; EL PASO INSURANCE COMPANY LIMITED; EXCESS INSURANCE
COMPANY LIMITED; FOLKSAM
INTERNATIONAL INSURANCE COMPANY
(UK) LIMITED; HEDDINGTON INSURANCE
COMPANY (UK) LIMITED; LEXINGTON
INSURANCE COMPANY; LONDON AND
EDINBURGH GENERAL INSURANCE COMPANY
LIMITED; MENTOR INSURANCE COMPANY
(UK) LIMITED; MUTUAL REINSURANCE
COMPANY LIMITED; NEW HAMPSHIRE
INSURANCE COMPANY; PACIFIC AND
GENERAL; SOUTHERN AMERICAN
INSURANCE COMPANY; SOVEREIGN MARINE
& GENERAL INSURANCE COMPANY
LIMITED; SOVEREIGN MARINE & GENERAL
INSURANCE COMPANY LIMITED "C" A/C;
SOVEREIGN MARINE & GENERAL
INSURANCE COMPANY LIMITED NO. 12
A/C; STOREBRAND INSURANCE COMPANY
(UK) LIMITED; STRONGHOLD INSURANCE
COMPANY LIMITED; ST. KATHERINE
INSURANCE COMPANY LIMITED; ST.
KATHERINE INSURANCE COMPANY LIMITED
(X A/C); TAISHO MARINE & FIRE
INSURANCE COMPANY (UK) LIMITED;
TERRA NOVA INSURANCE COMPANY; TERRA
NOVA INSURANCE COMPANY LIMITED;
TOKIO MARINE & FIRE INSURANCE
COMPANY (UK) LIMITED; TUREGUM
INSURANCE COMPANY; WALBROOK
INSURANCE COMPANY LIMITED;
WINTERTHUR SWISS INSURANCE COMPANY;
and YASUDA FIRE AND MARINE
INSURANCE COMPANY (UK) LIMITED,
Defendants,
and
AUTO-OWNERS INSURANCE COMPANY;
CANADIAN GENERAL INSURANCE COMPANY;
COMMERCIAL UNION ASSURANCE COMPANY
OF CANADA; ROYAL INSURANCE COMPANY
OF CANADA; and WELLINGTON INSURANCE
COMPANY;
Defendants-Appellants.
O'HERN, J., concurring.
I concur in the judgment of the Court. The exercise of
jurisdiction in this case would offend the traditional notions of
fair play and substantial justice that infuse the Due Process
Clause of the Fourteenth Amendment of the United States
Constitution. I disagree, however, that a territory-of-coverage
clause in an insurance policy is insufficient to establish the
minimum contacts that make up the first prong of the two-part
test for determining when jurisdiction may be exercised over a
non-resident defendant.
[International Shoe Co. v. Washington, In the context of specific jurisdiction (a lawsuit related to the contacts), the minimum-contacts requirement must result from the defendant's purposeful conduct, not from the unilateral
activities of the plaintiff. Lebel, supra, 115 N.J. at 323. A
territory-of-coverage clause can establish the minimum contacts
sufficient to sustain jurisdiction. The Texas Supreme Court has
held: |