Yanmar Am. Corp. v. Crean Equip., Inc., No. 542-7-10 Rdcv (Teachout, J., June 6, 2011)

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                                                       STATE OF VERMONT

SUPERIOR COURT                                                                                         CIVIL DIVISION
Rutland Unit                                                                                           Docket No. 542-7-10 Rdcv


Yanmar American Corp.
     Plaintiff

           v.

Crean Equipment, Inc.
       Defendant

                                                      DECISION
                                         Defendant’s Motion for Reconsideration

        Defendant Crean Equipment, Inc. (“Crean”) seeks reconsideration of the court’s decision
granting summary judgment to Plaintiff Yanmar American Corp. (“Yanmar”). Defendant argues
that the court mistook the Georgia court’s entry of default judgment against Crean as a ruling on
the merits of Crean’s Rule 12(b)(6) motion to dismiss for failure to state a claim. Defendant now
asserts that it never actually appeared in the Georgia proceedings and is entitled to contest
personal jurisdiction in this court.

        After Yanmar, pursuant to the contract between Yanmar and Crean, brought suit in
Barstow County, Georgia, Timothy Crean, president of Crean, appeared in the Georgia action
and filed a 12(b)(6) motion to dismiss for failure to state a claim. Crean filled no other
preliminary motions and did not contest personal jurisdiction. It now appears that the Georgia
court did not address the 12(b)(6) motion but rather entered a default judgment against Crean
because Tim Crean was not authorized to represent Crean Equipment, Inc.

         Defendant’s argument in favor of reconsideration mischaracterizes the reasoning
supporting the court’s grant of summary judgment to the Plaintiff. The issue is not whether the
Georgia ruled on the 12(b)(6) motion but rather that Tim Crean filed it in the Georgia forum. By
filing a 12(b)(6) motion and no jurisdictional challenges, a party waives any potential challenge
to personal jurisdiction. See O.C.G.A. § 9-11-12(h)(1)(A); see also 18A Wright, Miller, &
Cooper, Federal Practice and Procedure: Civil 2d § 4430 (“A defendant who appears to litigate
the merits without properly preserving an objection to personal jurisdiction forfeits the right to
raise the objection in the initial proceeding and is bound by the resulting judgment.”). Tim
Crean, merely by attempting to litigate the merits of the case in the Georgia court, waived any
challenge as to personal jurisdiction.

      Defendant focuses on Tim Crean’s inability to represent the corporate defendant Crean
Equipment, Inc. in the Georgia court. Defendant cites no law in support of its position that Tim
Crean’s action cannot bind Crean Equipment, Inc. The court finds the cases cited by Plaintiff to
be persuasive. See, e.g., Jimenez ex rel. Disla v. Brenilee Corp., 852 N.Y.S.2d 94, 95 (App. Div.
2008) (holding corporate defendant’s improper appearance without counsel “provides no basis
for vacating a judgment entered against that defendant”). Crean cannot use its own failure to
follow corporate formalities as a defense against the waiver of any personal jurisdiction
challenge.

        Furthermore, Defendant has not shown that the contractual forum selection clause is
invalid. The contract between Yanmar and Crean provided that Barstow County, Georgia would
be the proper forum for all disputes arising out of the contract. By entering into a contract with a
forum selection clause, Defendant waived any challenge as to personal jurisdiction. Int’l
Collection Serv., Inc. v. Gibbs, 147 Vt. 105, 107 (1986). Even if Tim Crean’s attempted
appearance in the Georgia court did not waive Defendant’s personal jurisdiction challenge,
jurisdiction in Georgia was nonetheless valid under the contract.

                                              ORDER

       Defendant’s Motion for Reconsideration is denied.


       Dated at Rutland, Vermont this ___ day of ______________, 2011.


                                                                      ________________________
                                                                        Hon. Mary Miles Teachout
                                                                                  Superior Judge




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