Texas Personal Jurisdiction In a Guaranty Agreement Suit Cases
In National Truckers Service, Inc. v. Aero Systems, Inc., 480 S.W.2d 455 (Tex. Civ. App.--Fort Worth 1972, ref'd n.r.e.), National sued Aero, a Florida corporation, to collect a debt arising from a written guaranty agreement.
Acting through its president, Aero offered to guarantee the debts of its Texas subsidiary. Id. at 459.
Aero executed and mailed the guaranty agreement to National's offices in Fort Worth, Texas. Id.
The guaranty agreement specifically designated the place of payment in Texas. Id.
After default, National sued Aero on the guaranty agreement in Texas. Id.
The court of civil appeals held that Aero had sufficient minimum contacts with Texas to give rise to specific jurisdiction. Id. at 460.
Similarly, in Gubitosi v. Buddy Schoellkopf Products, Inc., 545 S.W.2d 528 (Tex. Civ. App.--Tyler 1976, no writ), a New York guarantor was subject to suit in Texas. Gubitosi was a resident of New York and president of a New York corporation. Id. at 531.
He had no offices in Texas and had never even been to Texas. Id.
To induce a Texas corporation to enter into a note agreement with his New York corporation, Gubitosi executed guaranty agreements that made him individually liable for his corporation's promissory notes. Id. at 532.
Gubitosi's employee mailed the guaranty agreements and the notes from New York to Dallas, Texas. Gubitosi, 545 S.W.2d at 534.
The notes specifically provided for payments to Dallas, Texas. Id.
Although the guaranty agreements did not designate a place of payment, the court held that by implication, the guaranty agreements likewise provided for payment to Dallas, Texas. Id.
But see Carbonit Houston, Inc. v. Exchange Bank, 628 S.W.2d 826, 831 (Tex. App.--Houston [14th Dist.] 1982, writ ref'd n.r.e.).
The contacts were sufficient to satisfy the due process minimum contacts test. Gubitosi, 545 S.W.2d at 532.
The Fifth Circuit similarly held that a Colorado resident was subject to personal jurisdiction in Texas in a suit on a guaranty agreement in Marathon Metallic Building Co. v. Mountain Empire Construction Co., 653 F.2d 921 (5th Cir. 1981) (applying Texas law).
A Colorado corporation executed and forwarded a continuing guaranty agreement to a Texas corporation. Id. at 922.
The guaranty agreement provided for delivery of goods "f.o.b. Houston" and for Texas law to govern its construction and performance. Id.
The Colorado corporation later entered into credit transactions with the Texas entity, purchasing merchandise and taking title in Texas. Id. at 923.
The Fifth Circuit held that the guaranty purposefully caused business activity in Texas, which was foreseeable to the guarantor Colorado corporation. Id.