HUDSON UNITED BANK v. CITIBANK DELAWARE, No. CV 02-0467996 S (Oct. 5, 2004)

THOMPSON, JUDGE.

This action has its origin in a check for $25,000 that was drawn on the defendant, Citibank Delaware (Citibank), and issued by Salomon Smith Barney (SSB), a holder of an account with Citibank. Citibank Delaware is a Delaware banking institution incorporated in Delaware. The check was made payable to the Estate of Joseph A. Hill, a Connecticut customer with an account at the plaintiff Hudson United Bank (Hudson). Hudson is a banking institution licensed to do business in Connecticut. Hudson alleges that it paid the check to the Estate of Joseph Hill and that Citibank debited SSB's account the amount of $25,000. Hudson further alleges that Citibank failed to reimburse Hudson for payment of the check. On August 6, 2002, Hudson filed a one-count complaint against Citibank alleging that Citibank has been unjustly enriched by failing to pay Hudson the amount of the check. On August 6, 2004, Citibank filed a motion to dismiss Hudson's complaint for lack of personal jurisdiction.

"A motion to dismiss properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court." (Internal quotation marks omitted.) Blumenthal v. Barnes, 261 Conn. 434, 442, 804 A.2d 152 (2002). "A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Internal quotation marks omitted.) Dyous v. Psychiatric Security Review Board, 264 Conn. 766, 773, 826 A.2d 138 (2003). "Although the filing of an appearance on behalf of a party, in and of itself, does not waive that party's personal jurisdiction claims, [a]ny [defendant] wishing to contest the court's jurisdiction may do so by filing a motion to dismiss within thirty days of the filing of an appearance." (Internal quotation marks omitted.) Connor v. Statewide Grievance Committee, 260 Conn. 435, 445, 797 A.2d 1081 (2002). CT Page 15116

"In ruling upon whether a complaint survives a motion to dismiss, a court must take the facts to be those alleged in the complaint, including those facts necessarily implied from the allegations, construing them in a manner most favorable to the pleader." (Internal quotation marks omitted.) Dyous v. Psychiatric Security Review Board, supra, 773. "The motion to dismiss admits all facts which are well pleaded, invokes the existing record and must be decided upon that alone. Where, however, the motion is accompanied by supporting affidavits containing undisputed facts, the court may look to their content for determination of the jurisdictional issue and need not conclusively presume the validity of the allegations of the complaint." (Internal quotation marks omitted.) Ferreira v. Pringle, 255 Conn. 330, 346-47, 766 A.2d 400 (2001).

"If a challenge to the court's personal jurisdiction is raised by a defendant, either by a foreign corporation or by a nonresident individual, the plaintiff must bear the burden of proving the court's jurisdiction." Knipple v. Viking Communications, Ltd., 236 Conn. 602, 607, 674 A.2d 426 (1996). "When a defendant files a motion to dismiss challenging the court's jurisdiction, a two part inquiry is required. The trial court must first decide whether the applicable state long-arm statute authorizes the assertion of jurisdiction over the [defendant]. If the statutory requirements [are] met, its second obligation [is] then to decide whether the exercise of jurisdiction over the [defendant] would violate constitutional principles of due process." (Internal quotation marks omitted.) Id., 606-07.

In support of the motion, Citibank argues that Hudson's complaint fails to allege any basis for Connecticut's personal jurisdiction over a Delaware corporation. Citibank further argues that it is not registered to do business in Connecticut, is not a Connecticut corporation, nor does it maintain offices or conduct business here. Citibank submitted an affidavit from its general counsel attesting to these facts. Citibank maintains not only would it be unreasonable and contrary to the constitutional requirements of due process for this court to exercise jurisdiction over it, but also, pursuant to General Statutes § 52-59b, the court lacks any personal jurisdiction over it.

Hudson argues that the applicable statute providing a CT Page 15117 jurisdictional ground is General Statutes § 33-929(f)(1) and (2). Citibank is a foreign corporation, and, therefore, § 33-92(f) is the governing long-arm statute. The Connecticut Appellate Court has held "[a] foreign corporation may be hailed into court in Connecticut only if a plaintiff alleges jurisdictional facts that, if proven, would satisfy one of the provisions of our long arm statute . . . § 33-929(f)." Pitruzello v. Muro, 70 Conn.App. 309, 311, 798 A.2d 469 (2002).

Section 33-929(f) "confers jurisdiction over designated causes of action without regard to whether a foreign corporation transacts business in Connecticut and without regard to a causal connection between the plaintiff's cause of action and the defendant's presence in the state." Lombard Bros., Inc., v. General Asset Management Co., 190 Conn. 245, 253-54, 460 A.2d 481 (1983). "Under General Statutes § 33-929(f)(1), personal jurisdiction may be conferred upon a foreign corporation due to an action arising out of any contract made in this state or to be performed in this state. In order to satisfy this provision of General Statutes § 33-929(f)(1), the agreement serving as the basis for jurisdiction must contemplate or encompass some performance in Connecticut." (Internal quotation marks omitted.) Barrett v. Penn. Warranty Corp., Superior Court, judicial district of New Britain, Docket No. CV 03 0522826 (May 10, 2004, Murray, J.) "Performance of the contact in Connecticut . . . must be clearly contemplated or required in this state in order for a court to exercise personal jurisdiction over a defendant that has no other contacts with the state under General Statutes § 33-929(f)(1)." (Internal quotation marks omitted.) Wellner v. Kasarjian, Superior Court, judicial district of Hartford, Docket No. CV 96 562940, (April 6, 1999, Peck J.)

It should be noted that Hudson does not claim to have any contractual relationship with Citibank. Hudson claims that SSB and Citibank entered into a banking contract that was to be performed in Connecticut and that its claim for unjust enrichment arises out of this contract. Citibank entered into a banking contract with SSB. At the time the contract was formed, SSB was a corporation licensed to do business in Connecticut. Under the contract SSB was to conduct banking activities in Connecticut. Citibank provided checks to SSB with a Connecticut address. The parties contemplated that this banking contract would be performed in Connecticut. Citibank debited SSB's account the amount of the check per the banking contract but Hudson alleges it never paid that amount to Hudson. Citibank is subject, CT Page 15118 therefore, to personal jurisdiction in Connecticut courts under § 33-929(f)(1).

"Once it has been determined that jurisdiction may be exercised pursuant to § 33-929(f)(1), [the] court must next determine whether the exercise of jurisdiction over the defendant would violate constitutional principals of due process. Resource Systems Group v. Internet Cash Corporation, Superior Court, judicial district of Stamford/Norwalk at Stamford, Docket No. CV 00 0181480 (June 12, 2001, Lewis, J.T.R.) "The federal due process clause permits state courts to exercise in personam jurisdiction over a nonresident corporate defendant that has `certain minimum contacts with [the forum] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.'" Thomason v. Chemical Bank, 234 Conn. 281, 287, 661 A.2d 595 (1995), quoting International Shoe Company v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945). "The twin touchstones of due process analysis under the minimum contacts doctrine are foreseeability and fairness. [T]he foreseeability that is critical to due process analysis . . . is that the defendant's conduct and connection with the forum State are such that he should reasonably anticipate being hailed into court there." (Internal quotation marks omitted.) Phoenix Leasing, Inc. v. Kosinski, 47 Conn.App. 650, 654, 707 A.2d 314 (1998).

"Whether sufficient minimum contacts exist for a court to have jurisdiction is clearly dependent on the facts of each particular case. Like any standard that requires a determination of reasonableness, the minimum contacts test of International Shoe is not susceptible of mechanical application; rather, the facts of each case must be weighed to determine whether the requisite affiliating circumstances are present." (Internal quotation marks omitted.) Standard Tallow Corporation v. Jowdy, 190 Conn. 48, 52, 459 A.2d 503 (1983). "In judging minimum contacts, a court properly focuses on the relationship among the defendant, the forum, and the litigation." (Internal quotation marks omitted.) Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 775, 104 S.Ct. 1473, 79 L.Ed.2d 790 (1984).

Citibank purposefully entered into a banking contract with SSB. Citibank accepted and enjoyed the benefits of this banking contract. Citibank entered into a banking contract with SSB to pay checks written in Connecticut. Connecticut has an interest in this litigation because this action arises out of a banking CT Page 15119 contract to be performed in Connecticut. The check at the center of this dispute was issued by a corporation licensed to do business in Connecticut, was made payable to a Connecticut banking customer, and was deposited in a Connecticut bank. These factors made Citibank aware of the possibility of being hailed in Connecticut courts. There are sufficient minimum contacts so that it is fair to subject Citibank to jurisdiction in Connecticut.

"Once a plaintiff has demonstrated the requisite minimum contacts between the defendant and the forum state, a court is required to continue to the reasonableness stage of the inquiry . . . to assess whether the exercise of jurisdiction comports with traditional notions of fair play and substantial justice." (Internal quotation marks omitted.) Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 573, (2d Cir.), cert. denied, 519 U.S. 1006, 117 S.Ct 508, 136 L.Ed.2d 398 (1996). "[T]he determination of the reasonableness of the exercise of jurisdiction in each case will depend on an evaluation of several factors. A court must consider the burden on the defendant, the interests of the forum State, and the plaintiff's interest in obtaining relief. It must also weigh in its determination the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and the shared interest of the several States in furthering fundamental substantive social policies." (Internal quotation marks omitted.) Asahi Metal Industry Co. v. Superior Court of California, 480 U.S. 102, 113, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987).

Citibank's defense of this action in Connecticut does not constitute an undue burden. Citibank's general counsel is located in nearby New York, and it has hired local counsel in Connecticut. Citibank is a subsidiary of Citigroup, a global financial services company. The mere lack of an office in Connecticut or telephone listing in Connecticut does not impose an undue burden on such a large company. In addition, as noted previously, Connecticut has an interest in this litigation because Hudson is a Connecticut banking institution and Connecticut is concerned with protecting its banks from out-of-state banking institutions that contract with local Connecticut corporations to provide banking services. The interstate judicial system is benefitted by obtaining the most efficient resolution of the controversy and allows jurisdiction in Connecticut.

For the foregoing reasons, Citibank's motion to dismiss is denied. CT Page 15120

Thompson, J.