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Telford v. Smith County, Texas

Supreme Court of Idaho, Twin Falls

November 26, 2013

Holli TELFORD, as assignee to M.D. Diet Trust, Plaintiff-Appellant,
v.
SMITH COUNTY, TEXAS; Gary Barber as the Tax Assessor of Smith County, Texas; Attorney Tab Beaell; and the Law Offices of Purdue Bradon Felder Collins & Mott, Defendants-Respondents, and Artie Ross; Sandra Copeland; Admitra Mills; Jeanette Harmon; Cody Kelley; Paul Kelley Jr; The Estate of Paul Kelley Sr; and Lisa Neilson, Defendants.

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[Copyrighted Material Omitted]

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Holli Telford, Malad City, argued on her own behalf.

Stephen L. Adams, Anderson, Julian & Hull LLP, Boise, argued for respondents.

EISMANN, Justice.

This is an appeal out of Oneida County from a case seeking specific performance of an alleged contract with Smith County, Texas, to purchase real property in Texas or damages from the county and various residents of Texas for breach of the alleged contract. The defendants who had been properly served moved to dismiss this case for lack of personal jurisdiction. The district court granted the motion and dismissed the case with prejudice as to them and without prejudice as to the other defendants. We affirm the dismissal for lack of jurisdiction, but vacate the dismissal with prejudice and remand for entry of a judgment dismissing the complaint without prejudice.

I.

Factual Background.

Elham Neilsen, a resident of Utah, wanted to purchase a residence close to the city of Tyler in Smith County, Texas. He contacted Holli Telford because he had heard that she knew how to acquire properties through tax or other distress sales and had contacts for obtaining financing for prospective buyers. She showed Mr. Neilsen how to monitor the website of Smith County for properties it was offering for sale pursuant to a sealed-bid auction. Mr. Neilson identified a property he desired to purchase. He entered into an agreement with Ms. Telford that she would bid on the property and sell it to him after she had obtained the warranty deed. Ms. Telford submitted a bid, but did not obtain title to the property because, according to her, it was wrongfully redeemed by the prior owners after she had spent money improving it.

On June 2, 2011, Holli Telford filed this action against multiple Defendants seeking either specific performance of her alleged contract to purchase the property or damages. Ms. Telford sent copies of the summons and complaint to the Defendants by certified mail. After they did not appear in this action, she sought default judgments against them. The district court denied that request because the Defendants had not been properly served. Ms. Telford then effectuated personal service upon Smith County, Texas; Gary Barber, the assessor; Tab Beall, an attorney, and Perdue, Brandon, Fielder, Collins and Mott, LLP, the law firm for which he works.

On June 30, 2011, notices of special appearance were filed by the Defendants that had been personally served. These Defendants will collectively be called " Appearing Defendants," and the remaining defendants will be called " Nonappearing Defendants."

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On July 13, 2011, Appearing Defendants filed as one document a Motion to Dismiss, Motion to Quash, and Motion for Summary Judgment. Included in the document was a motion to dismiss for lack of personal jurisdiction. After briefing and argument, the district court held that it did not have personal jurisdiction over the defendants. After denying Ms. Telford's motion for reconsideration, the court entered a judgment dismissing this action with prejudice as to Appearing Defendants and without prejudice as to Nonappearing Defendants. Ms. Telford then timely appealed.

II.

Did the District Court Err in Refusing to Enter Default Judgments?

Ms. Telford initially attempted to serve all of the Defendants by certified mail. She contended that she was permitted to do so by Idaho Code section 48-613, which provides:

Service of any notice, demand or subpoena under this act shall be made personally within this state, but if such cannot be obtained, substituted service therefor may be made in the following manner:
(1) Personal service thereof without this state; or
(2) The mailing thereof by registered or certified mail to the last known place of business, residence or abode within or without this state or such person for whom the same is intended; or
(3) As to any person other than a natural person, in the manner provided in the Idaho rules of civil procedure as if a complaint which institutes a civil proceeding had been filed.

That statute only applies to the service of a " notice, demand or subpoena under this act," which is the Idaho Consumer Protection Act, I.C. §§ 48-601 to 48-619. In context, it refers to the Attorney General serving: (a) a " notice in writing that such proceedings [a civil action] are contemplated to the person against whom proceedings are contemplated," I.C. § 48-606(3); (b) " an investigative demand" for information from a person whom the Attorney General believes has violated the act, I.C. § 48-611(1); and (c) subpoenas issued by the Attorney General to persons in aid of an investigation or inquiry under the act, I.C. § 48-612. It does not apply to the service of a summons and complaint in a civil action. Thus, the district court did not err in holding that Idaho Code section 48-613 did not authorize service of the summons and complaint by registered or certified mail.

III.

Did the District Court Err in Holding that Appearing Defendants Did Not Make a General Appearance?

Ms. Telford first argues that Appearing Defendants made a general appearance when they included a motion for summary judgment with their motion to dismiss for lack of personal jurisdiction. Rule 12(g)(1) of the Idaho Rules of Civil Procedure states that " [a] defense of lack of jurisdiction over the person ... is waived unless it is made ... prior to filing any other motion, [but] ... [i]t is not waived, however, by being joined with one or more other motions...." Appearing Defendants did not ...


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