§ 302.Personal jurisdiction by acts of non-domiciliaries.

(See also Advisory Committee notes preceding § 301, under subheading “Jurisdiction”).

Subd (a), modeled upon the Illinois CPA § 17 which was effective on January 1, 1956, is designed to take advantage of the constitutional power of the state of New York to subject nonresidents to personal jurisdiction when they commit acts within the state.

An action excluded under subparagraph 2 would be within subparagraph 1 if it arose from the defendant’s transaction of business within the state.

The reference to contracts of insurance in the Illinois provision has been omitted because § 59-a of the Insurance Law is broader. It is not limited by the operative words of § 302, “as to a cause of action arising from any of the acts enumerated in this section.” Thus, under the New York Insurance Law, collecting a premium in New York would make the statute operative in a suit on the contract as well as in one for recovery of the premium.

While New York formerly had a number of statutes, dealing with submission to jurisdiction by nonresidents in specific situations, it had no general statute. It is clear that the requirement of doing business within the state, found both in the cases in respect to foreign corporations not specifically authorized to do business in New York by compliance with § 210 of the Gen Corp L and in CPA § 229-b (nonresident individual doing business within the state), is not essential to the constitutional exercise of personal jurisdiction. In addition to Illinois, other states have enacted statutes to take advantage of their constitutional power under the leading case of International Shoe Co. v Washington, 326 US 310 (1945). For example, any foreign corporation submits itself to the jurisdiction of the Vermont courts if it “makes a contract with a resident of Vermont to be performed in whole or in part by either party in Vermont, or . . . commits a tort in whole or in part in Vermont against a resident of Vermont.” Vt Rev Stat § 1562 (1947). Similarly, foreign corporations are subjected to the jurisdiction of the Maryland courts on “any cause of action arising out of a contract made within this State or liability incurred for acts done within this State, whether or not such foreign corporation is doing or has done business in this State.” Md Ann Code art 23, § 88(d) (1951). These statutes have been sustained in Smyth v Twin State Improvement Corp. 116 Vt 569, 80 A2d 664 (1951), and Compania de Astral, S. A. v Boston Metals Co. 205 Md 237, 107 A2d 357 (majority), 108 A2d 372 (dissent) (1954), cert denied, 348 US 943 (1955).

Any remaining doubt as to the constitutionality of statutes such as those of Illinois, Vermont or Maryland would appear to be dispelled by a recent decision of the United States Supreme Court. On December 16, 1957, in McGee v International Life Ins. Co. 355 US 220 (1957), the court sustained the acquisition of in personam jurisdiction by a California court over a nonresident insurer who had offered to insure through the mails and who had been served without the state by registered mail. Summarizing the rationale of changing concepts of in personam jurisdiction, the court stated:

Looking back over this long history of litigation a trend is clearly discernible toward expanding the permissible scope of state jurisdiction over foreign corporations and other nonresidents. In part this is attributable to the fundamental transformation of our national economy over the years. Today many commercial transactions touch two or more States and may involve parties separated by the full continent. With this increasing nationalization of commerce has come a great increase in the amount of business conducted by mail across state lines. At the same time modern transportation and communication have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity.

. . . It is sufficient for purposes of due process that the suit was based on a contract which had substantial connection with that State. . . . The contract was delivered in California, the premiums were mailed from there and the insured was a resident of that State when he died. It cannot be denied that California has a manifest interest in providing effective means of redress for its residents when their insurers refuse to pay claims. [ Id. at 222–23.].

Most of the specific situations covered by the present New York statutes are dealt with in this statute. The present statutes should therefore be reconsidered. To a large extent the same ground is covered. If they are not repealed, the references in the present statutes to procedure should be excised so that the general rules will apply on methods of service. Because of the general provisions of § 301, jurisdiction may be acquired either under the special statutes—to the extent that they are not repealed—or under § 302. The intention is to broaden the bases of jurisdiction to permit jurisdiction to be obtained in any case where it is possible to obtain it under present law or where it would be possible under any provision hereafter in effect. In this area, then, specific provisions do not supersede the general provisions of §§ 301 and 302. The latter remain to govern cases for which no specific provision is made.

The section largely eliminates the service upon a public officer, such as the Secretary of State, required by most of the other statutes. A method of service must give “reasonable assurance that the notice will be actual.” International Shoe Co. v Washington, 326 US 310, 320 (1945). For example, personal service without the state is actually more effective in giving notice than is service upon the Secretary of State and a mailing of the summons by him.

Subd (b) was added to clarify the limited nature of the personal jurisdiction obtained under subdivision (a).

1979 Recommendations of the Law Revision Commission:

Introduction.

In Simpson v. Loehmann (21 NY 2d 305, 312) the Court of Appeals suggested that the Law Revision Commission or the CPLR Advisory Committee of the Judicial Conference should study current notions of jurisdiction as set forth in article 3 of the CPLR. In 1969 the editors of the Columbia Law Review, at the request of the Judicial Conference, published a study which surveys the manner by which all jurisdictional concepts could be altered and rearranged (“Jurisdiction in New York: A Proposed Reform”, 69 Columbia Law Rev.1412). That study is extremely helpful, but it was never acted upon either by the Judicial Conference or the Law Revision Commission. In the nine years since publication of the study statutory and case law advancements such as the expansion of the doctrine of forum non conveniens ( Silver v. Great American Ins. Co., 29 NY 2d 710; Martin v. Mieth, 35 NY 2d 414: CPLR 327), the institution of the limited appearance ( CPLR 320[c]), and long arm jurisdiction in matrimonial actions ( CPLR 302[b]), have served to implement some of the editors’ recommendations.

In late 1974, with the approval of the Judicial Conference’s CPLR Advisory Committee, the Commission undertook the task of revising Article 3 where it seemed that revision was warranted. This study has resulted in two separate Recommendations.

This is the first and deals with long arm jurisdictions proposing:

1. That the opening paragraph of section 302(a) be amended so that a nonresident is answerable in New York for activities conducted “by another” in his behalf here rather than, as now worded, “through an agent”;

2. That paragraph 1 of subdivision (a) of section 302 be enlarged so that jurisdiction can be obtained over one who contracts anywhere to provide goods or services within the state;

3. That the long arm provision respecting alimony and support claims in matrimonial actions be amended to provide that New York must have been the last matrimonial domicile.

The second separate Recommendation proposes that the forms of quasi in rem jurisdiction now found in section 314 dealing with service without the state be set forth in a separate section clearly labeled as creating in rem bases of jurisdiction; and that such jurisdiction be tailored so as to comply with the holding in Shaffer v. Heitner (53 L Ed 2d 683). Amendments respecting service and appearance are included.

Section 302-Long Arm.

Subdivision (a), Opening Paragraph. .

This provides:

(a) Acts which are the basis of jurisdiction. As to a cause of action arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any nondomiciliary, or his executor or administrator, who in person or through an agent: *** The problem “is whether the term ‘ agent’ is used in its precise legal sense so that the acts of an independent contractor, performed at the request of the defendant, will not be attributed to the defendant the for purposes of jurisdiction under CPLR 302.” (McKinney’s Cons. Laws of N.Y., Book 7B, sec. 302, McLaughlin’s Practice Commentary C302:3). “Where a non-domiciliary requests a person to perform an act in New York for the benefit of the non-domiciliary, what difference does it make whether the person is an employee, an agent, or an independent contractor, so long as the act is performed in New York, is purposeful, and benefits the non-domiciliary?” (Ibid.).

The Commission proposes simply to delete the words “or through an agent” and substitute “or through another acting on his behalf.” Transacting Business.

The first subparagraph of subdivision (a) provides for long arm jurisdiction if defendant “transacts any business within the state.” This has been construed literally so that defendant or his agent must have been physically present in the state at some relevant time ( Kramer v. Vogl, 17 NY 2d 27). Shipment of goods plus other general activities in the state such as solicitation of business through promotional material can suffice and these other contacts need have no direct connection to the cause of action arising out of the particular shipment ( Singer v. Walker, 15 NY 2d 443). Occasionally the courts’ literal application of subparagraph one leads to anomalous results. (Compare Liquid Carriers Corp. v. American Marine Corp. 375 F. 2d 951-negotiations within the state for a contract to be performed without the state constitutes transaction of business here — with McKee Electric Co. v. Rauland-Borg Corp., 20 NY 2d 377 — the negotiation of contracts out of state for performance within the state does not constitute the transaction of business here.).

There is ample constitutional authority for expanding long arm jurisdiction so as to include instances of transactions of business having a direct effect within the state regardless of where the transaction originated. In McGee v. International Life Ins. Co. (355 U.S. 220), insofar as indicated by the record, the only contact between an Arizona based life insurance company and its California insured was through the mails whereby premiums on the policy were billed and paid. The insurance company maintained no office in California, nor did it solicit business there either through literature or salesmen. The Court found personal jurisdiction in California when suit was started there for payment on the policy. 1. The McGee case has not generally been viewed as limited to claims against insurance companies (see VonMehren and Trautman, Jurisdiction to Adjudicate: A suggested Analysis, 79 Harvard Law Rev. 1121, 1150–51 [1966]).

In the landmark case of International Shoe Co. v. Washington (326 U.S. 310) the state sued the shoe company for contributions to the state’s unemployment insurance fund. The Court announced a jurisdictional theory based not on the old concept of the state’s power over the defendant because of its actual presence or because it was “doing business” there, but on the contact established in the state because of the activities of defendant’s salesmen there. Chief Justice Stone held that certain kinds of contacts by the defendant with the forum state because of their nature, quality and circumstances of their commission, could be deemed sufficient to render the corporation liable to suit on causes of action arising from those contacts; that it is the nature of the defendant’s contacts with the state that reveals the true justification for maintaining or not maintaining jurisdiction. The quality of those contacts must be such that no unfairness inures to defendant in forcing him to submit to the state’s jurisdiction, and so that the federal system of values is maintained.

It lies with the Legislature to exploit the full potential of International Shoe and McGee. The Supreme Court, even in Hanson v. Denckla (357 U.S. 235) where limits were put on the McGee rationale, stated as a predicate of reasonable contact that “it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum state, thus involving the benefits and protection of its laws. . . ” ( 357 U.S. at 253). That act certainly could be the mere sending of goods into the state. Nor is there any reason why a nonresident who contracts to sell goods or perform services in New York, regardless of where the agreement was made, should escape the power of the New York courts where there is a failure of performance on his part. “In these situations it does not seem oppressive to require that the non-resident, who agrees to perform a contract in New York, respond in New York for its non-performance” (.McKinney’s Cons. Laws of N. Y., Book 7B, sec. 302, McLaughlin’s Practice Commentary C302:13).

Certain problems such as the incidental New York contact where, for instance, goods merely pass through the state (McKinney’s Cons. Laws of N.Y., Book 7B, sec. 302, McLaughlin’s Practice Commentary, C302:0), would be difficult to cure through statutory change and will always present questions for judicial determination. With respect, however, to situations where goods are shipped into the State and where contracts are entered into without the State, there seems room for statutory refinement. It has been noted that the McGee rationale created a broad rule not fully utilized by the New York Court of Appeals. Nothing was looked to in McGee beyond the fact the insurance company did business by mail within the forum state with the plaintiff’s husband, the insured. Any other contacts the insurer might have had, or the number of other insureds it might have had in California were irrelevant. More persuasive even than McGee is the basic thesis of International Shoe that the test of jurisdiction is reasonableness, so that it follows that if a person intentionally creates a contact with New York by contracting to do something having effects in New York it is clearly reasonable that he be answerable in a New York court for his breach. The Commission believes that policy would best be served by extending New York long arm jurisdiction to these permissible limits so as to give plaintiffs injured in New York a convenient forum.

The Michigan, Wisconsin and Uniform statutes contain a provision not found in CPLR 302. Thus, in addition to “transacts any business in the state,” it is also provided in substance in those statutes that the contracting to supply goods or services within the state will also confer jurisdiction (32 Mich. Comp. Laws § 600.705(2); 30 Wisc. Stats. Ann. § 262.05[5][a]; 9B Unif. Laws Ann.§ l.03[2]). This is also recommended by the Columbia Law Review editors with the statement, “[t]his section is specifically enacted to remedy the current gap in the scope of the state’s permissible jurisdiction where a contract involving an out-of-state defendant is breached prior to the formation of 1. New York Insurance Law, § 59-a, separately provides for long arm jurisdiction over foreign insurers.

sufficient contact to find jurisdiction under the earlier [transacts business] section” ( 69 Columbia Law Rev, at 1431). This extension was advocated by the Judicial Conference as far back as 1966 (see The Eleventh Annual Report, p. 132, at 135). 2.

Subdivision (b) — Matrimonial Actions.

In 1974 the Legislature broadened the sweep of 302 by adding a new subdivision (b) which authorized New York Courts to require a nonresident defendant to pay alimony or support to a resident spouse or resident ex spouse “provided that this state was the matrimonial domicile of the parties before their separation, or the defendant abandoned the plaintiff in this state, or the obligation to pay support or alimony or alimony [sic] accrued under the laws of this state or under an agreement executed in this state.” Subdivision (b) does not now state whether New York must be the last matrimonial domicile or one maintained at any time in the past. (See McKinney’s Cons. Laws of N.Y., Book 7B, sec. 302, McLaughlin’s Practice commentary, C. 302:27, Suppl.). Since subdivision (b) confers long arm jurisdiction, one must inquire whether a matrimonial domicile which ceased to exist in the state for a period before an action is commenced provides sufficient contacts. A few jurisdictions such as Wisconsin recognize that the existence of such contacts at some point within the recent past is sufficient, apparently on the theory that one spouse’s presence in the state at the time the action is brought, plus the marital domicile having existed there within the recent past, provides sufficient contacts. (30 Wisc. Stat. Ann. § 262.05[11], marital relationship within state for continuous six months out of past six years.).

The Commission is of the opinion that more substantial contacts are desirable with respect to the location of the matrimonial domicile and would provide that such domicile must exist in New York at the time of the last separation. This view is endorsed by Professor Henry H. Foster, a specialist in the law of domestic relations. (Letter of Professor Foster to the Commission dated 6/16/76). Also, the Appellate Division, Second Department, has approved a holding that New York should be the matrimonial domicile at the time of the separation. ( Lieb v. Lieb, 53 A D 2d 67.) This not only provides a solid basis for personal jurisdiction, but also assures that plaintiff is not forum shopping and that New York has a direct interest in the situation. Thus, the statute should be amended so that the action may be brought “provided that this state was the last matrimonial domicile of the parties before their separation.

The phrase “or alimony” is mistakenly repeated in the last clause of subdivision (b) , and this error is corrected.

1995 Recommendations of Family Court Advisory and Rules Committee:

In 1990, the New York State Legislature amended Family Court Act § 1036 to establish long-arm jurisdiction in child abuse and neglect cases, where the child in deed of protection resides within the state [Laws of 1990, ch. 268]. This recognition that family violence knows no boundaries in an increasingly mobile society applies as well in all cases in which an order of protection in sought to protect family members from the threat of abuse. The Family Court in New York State has an interest in protecting individuals who are residents or are present on a regular basis in the state from violence committed in the state by family members, regardless of whether the offender is a state resident.

The Family Court Advisory and Rules Committee is submitting a proposal to amend Family Court Act § 154 to authorize service of process outside the state in child support, paternity, custody and guardianship, family offense 2. In addition to McKee Electric Co. v. Rauland-Borg (20 NY 2d 377), cases such as the following, where defendants were never in New York, would be subject to reevaluation in light of this amendment; Ferrante Equip. v. Lasker-Goldman (26 NY 2d 280) , giving of guarantee outside the state to secure performance within the state not sufficient for jurisdiction; Al Negelberg & Co. v. Trans Fresh Corporation (39 AD 2d 538), defendant’s application of its farm produce decay-preventing process without the state to produce sent into the state did not confer long arm jurisdiction; Electronic Devices, Inc. v. Mark Rogers Assoc. (63 Misc 2d 243), telephone call by defendant non-resident personnel placement agency into the state to plaintiff arranging to supply an employee, for which arrangement plaintiff paid defendant a fee, was not a transaction sufficient to provide long arm jurisdiction; Old Westbury Golf Club v. Mitchell (44 Misc 2d 687, affd 24 AD 2d 636, affd 18 NY 2d 670), no jurisdiction where a contract was made outside the state to furnish material to construction site in the state.

and child abuse and neglect proceedings in which an order of protection is sought. Specifically, the Family Court would be permitted to exercise personal jurisdiction over a person who is not a resident or domiciliary of New York State in cases where (1) the acts giving rise to the application for an order of protection or the claimed violation of an existing temporary or final order of protection occurred within the State, and (2) the applicant for the order resides or is domiciled in the State, or has substantial contacts in the State, including presence on a regular basis.

The proposed measure would establish special procedures to be observed when long-arm jurisdiction is exercised. First, it would provide that when service is effected upon a non-resident or non-domiciliary solely under this new long-arm provision, the papers to be served must include a conspicuous notice that the scope of the court’s jurisdiction is limited to the order of protection. Also, service of a petition and summons associated with the exercise of such jurisdiction must be made at least 20 days prior to the return date of the case in court.

Additionally, this measure would provide that in instances when a non-resident or non-domiciliary has been served, and later defaults by failing to appear, a court may, on its own motion or on the application of any party, proceed to a hearing with respect to the issuance of the order of protection.

Lastly, this measure would revise section 302(b) of the CPLR, to include within the scope of actions that may constitute the basis for a court to exercise personal jurisdiction over non-residents or non-domiciliaries section 154 of the Family Court Act, which, as it would be amended by this measure, will prescribe procedures for the disposition of orders of protection or violations of orders of protection arising under Articles 4, 5, 6, 8 or 10 of the Family Court Act.

2006 Recommendations of the Family Court Advisory and Rules Committee:

Enactment of the Uniform Child Custody Jurisdiction and Enforcement Act in New York State [Laws of 2001, Ch 386] has been extremely helpful in facilitating uniformity, consistency with federal law and greater enforceability of custody orders across jurisdictions. Now the law in 42 states, plus the District of Columbia and the United States Virgin Islands, 1 1 the UCCJEA has proven to be invaluable. At the same time, the experience under the UCCJEA has revealed a few areas necessitating fine-tuning. The Family Court Advisory and Rules Committee has developed a proposal that strengthens three provisions of the statute and increases access to justice for all litigants without sacrificing the uniformity that is essential to the efficacy of uniform acts.

First, the proposal restores subdivision one of section 75-f of the former Uniform Child Custody Jurisdiction Act , which was repealed when the UCCJA was replaced by the UCCJEA . That provision permitted the Supreme or Family Court to direct service of an order to show cause or a petition involving an out-of-state party by personal service, by mail with proof by a return receipt or by other means directed by the Court, 2 2 The absence of specific provisions in the UCCJEA for service by mail out of state, both for plenary and enforcement actions, has posed a significant impediment to litigants, especially in the Family Court, particularly the many litigants without counsel who lack resources and wherewithal to effectuate service.

Restoration of the flexibility the former UCCJA regarding service of process is essential to ensure fairness to all sides in interstate custody litigation and to the facilitate prompt adjudication. Litigants lacking resources to retain out-of-state firms to serve pleadings may either let litigation languish for long periods or may improperly attempt personal service themselves. Victims of family violence, in particular, may require the option of service by mail or other means directed by the Court that are designed to provide actual notice. Ensuring that litigants have access to means of fast, fair, safe and effective service is central to the legislative purposes underlying the UCCJEA , that is, “to provide and effective mechanism to obtain and enforce orders of custody and visitation across state lines and to do so in a manner that ensures that the safety of the children is paramount and that victims of domestic violence and child abuse are protected.” [ D.R.L. § 75(2)].

1 Source: National Conference of Commissioners on Uniform State Laws, A Few Facts About the UCCJEA (Dec, 2005)( www.nccusl.org).

2 This proposal has been modified from its 2005 version to restore the language of former D.R.L. § 75-f verbatim, thus requiring a return receipt when service is made by mail.

Second, the proposal provides needed clarity regarding the circumstances under which communication between courts is discretionary and under which it is mandated. Section 75-i(1) of the Domestic Relations Law would be amended to cross-reference to sections 76-c(4), 76-e(2) and 77-f, thus identifying the three situations — temporary emergency jurisdiction, simultaneous child custody proceedings pending in two jurisdictions and simultaneous enforcement and modification proceedings in two jurisdiction — where inter-court communications are mandated. In all other situations, courts retain discretion as to communications with courts in other jurisdictions.

Third, the proposal clarifies that depositions or testimony taken by telephone, audio-visual or other electronic means must be recorded and preserved for transcription, an essential prerequisite for preserving a record for appeal. Courts would be further directed to cooperate in determining the procedures to be followed in taking testimony by these means, including, for example, the swearing-in of witnesses and the ruling on objections in depositions.

Finally, the proposal would make a technical amendment to section 302(b) of the Civil Practice Law and Rules, that is, to add cross-references to the Uniform Interstate Family Support Act [Article 5-B of the Family Court Act] and the Uniform Child Custody Jurisdiction and Enforcement Act [Article 5-A of the Domestic Relations Law] to the provision regarding Family Court jurisdiction over non-resident respondents.

Especially in light of its rapid enactment throughout the country, the UCCJEA has become an increasingly useful vehicle for the resolution of the frequent inter-jurisdictional issues that arise in custody cases. Enactment of the Committee’s proposal would significantly ease the burden on litigants in initiating and conducting proceedings under the UCCJEA and would make a needed correction to the personal jurisdiction provision of the Civil Practice Law and Rules.

Add, L 1962, ch 308, § 1, eff Sept 1, 1963; amd, L 1966, ch 590, § 1, eff Sept 1, 1966; L 1974, ch 859, § 1, eff June 7, 1974; L 1979, ch 252, §§ 1, 2, eff Sept 1, 1979; L 1980, ch 281, § 22; L 1982, ch 505, § 1; L 1991, ch 69, § 7; L 1995, ch 441, § 2, eff Oct 31, 1995; L 2006, ch 184, § 5, eff July 26, 2006; L 2008, ch 66, § 3, eff April 28, 2008.