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State ex rel. Key Insurance Co. v. Roldan

Supreme Court of Missouri, En Banc

October 29, 2019

STATE EX REL. KEY INSURANCE COMPANY, Relator,
v.
THE HONORABLE MARCO A. ROLDAN, Respondent.

          ORIGINAL PROCEEDING IN PROHIBITION

          Zel M. Fischer, Judge

         Key Insurance Company filed a petition for a writ of prohibition directing the circuit court to dismiss, for lack of personal jurisdiction, claims filed against it by Josiah Wright and Phillip Nash. This Court issued a preliminary writ of prohibition. Nash alleges Key committed the tort of bad faith refusal to settle in Missouri, bringing Key within the purview of Missouri's long-arm statute and establishing the requisite minimum contacts necessary to satisfy due process. The preliminary writ of prohibition is quashed.

         Factual Background

         Key Insurance Company is an insurance company incorporated under the laws of the state of Kansas with its principal place of business in Kansas. Key issued an insurance policy to Kansas City, Kansas, resident, Takesha Nash (Takesha). The insurance policy covered her 2002 Kia Optima. Takesha's father, Phillip Nash (Nash), was involved in a motor vehicle collision with Josiah Wright in Jackson County, Missouri, while driving Takesha's Optima. Soon after the collision, Wright's counsel informed Key of the collision, and Key denied coverage.[1] Wright sued Nash in Jackson County. Wright and Nash agreed to submit their dispute to arbitration in Jackson County. The arbitrator awarded Wright $4.5 million in damages. The circuit court then confirmed Wright's arbitration award as a final judgment.

         After arbitration, Wright filed a lawsuit against Key and Nash in the Jackson County circuit court seeking to collect insurance proceeds from Takesha's Key insurance policy. Nash filed a cross-claim against Key, alleging Key committed the tort of bad faith refusal to settle and breached its contractual duty to defend him. Key filed a motion to dismiss Wright and Nash's claims for lack of personal jurisdiction, which the circuit court overruled. Key sought a writ of prohibition from this Court directing the circuit court to dismiss Wright and Nash's claims for lack of personal jurisdiction. This Court issued a preliminary writ of prohibition.

         Standard of Review

         This Court has jurisdiction to issue original remedial writs. Mo. Const. art. V, § 4.1.

A writ of prohibition is appropriate: (1) to prevent the usurpation of judicial power when a lower court lacks authority or jurisdiction; (2) to remedy an excess of authority, jurisdiction or abuse of discretion where the lower court lacks the power to act as intended; or (3) where a party may suffer irreparable harm if relief is not granted.

State ex rel. Hawley v. Midkiff, 543 S.W.3d 604, 606-07 (Mo. banc 2018) (quoting State ex rel. Strauser v. Martinez, 416 S.W.3d 798, 801 (Mo. banc 2014)). "Prohibition is the proper remedy to prevent further action of the trial court where personal jurisdiction of the defendant is lacking." Id. at 607 (quoting State ex rel. Norfolk S. Ry. Co. v. Dolan, 512 S.W.3d 41, 45 (Mo. banc 2017)). Prohibition will issue only when the lower court's usurpation of jurisdiction is "clearly evident." Id.

         Analysis

         Personal jurisdiction is a court's power over the parties in a given case. Norfolk S. Ry., 512 S.W.3d at 46. "The basis of a court's personal jurisdiction over a corporation can be general-that is, all-purpose jurisdiction-or it can be specific-that is, conduct-linked jurisdiction." Id. This is not a case in which general jurisdiction is applicable, as Key is a corporation formed under Kansas law with its principal place of business in Kansas. See id. ("A court normally can exercise general jurisdiction over a corporation only when the corporation's place of incorporation or its principal place of business is in the forum state.").[2]

         Specific jurisdiction over a foreign corporation exists when the underlying lawsuit arises from the corporation's contacts with Missouri. State ex rel. PPG Indus., Inc. v. McShane, 560 S.W.3d 888, 891 (Mo. banc 2018). To establish specific personal jurisdiction over a foreign corporation, a two-prong test must be met: (1) the defendant's conduct must fall within the long-arm statute, § 506.500[3]; and (2) the court must then determine if the foreign corporation has the requisite minimum contacts so as not to offend due process. PPG Indus., 560 S.W.3d at 891. "A court evaluates personal jurisdiction by considering the allegations contained in the pleadings to determine whether, if taken as true, they establish facts adequate to invoke Missouri's long-arm statute and support a finding of minimum contacts with Missouri sufficient to satisfy due process." State ex rel. Cedar Crest Apartments, LLC v. Grate, 577 S.W.3d 490, 496 n.5 (Mo. banc 2019).

         Missouri's Long-Arm Statute, § 506.500

         Section 506.500, provides in pertinent part:

Any person or firm, whether or not a citizen or resident of this state, or any corporation, who in person or through an agent does any of the acts enumerated in this section, thereby submits such person, firm, or corporation, and, if an individual, his personal representative, to the jurisdiction of the courts of this state as to any cause of action arising from the doing of any such acts:
(3) The commission of a tortious act within this state[.]

         Nash's cross-claim alleges the tort of bad faith refusal to settle against Key. In Missouri, bad faith refusal to settle is a tort action. Scottsdale Ins. Co. v. Addison Ins. Co., 448 S.W.3d 818, 829 (Mo. banc 2014). "[A] bad faith refusal to settle action will lie when a liability insurer: (1) reserves the exclusive right to contest or settle any claim; (2) prohibits the insured from voluntarily assuming any liability or settling any claims without consent; and (3) is guilty of fraud or bad faith in refusing to settle a claim within the limits of the policy." Id. at 827.

         Taking Nash's allegations in his cross-claim as true, there are facts established that invoke Missouri's long-arm statute and make a prima facie showing as to the validity of his bad faith refusal to settle claim. Wright's petition, and subsequently Nash's cross-claim, allege jurisdiction is proper in Missouri under § 506.500 because the action arises out of a contract to insure a person, property, or risk in Missouri.[4] Further, Nash alleges he is a resident of Jackson County, ...


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