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TCM Corp. v. Superior Court of the County of San Bernardino

12/17/2003

s an example of the awareness of the Legislature of the reach of section 351 with respect to substituted service on foreign corporations. The Dew court noted that Loope recognized that Corporations Code section 2111, providing for service of process on foreign corporations through the Secretary of State, rendered the provisions of section 351 inapplicable to such corporations. (Dew, supra, at p. 635, fn. 8.) Thus, "the Dew opinion confirms the holding in Loope, rather than disapproving it." (Cardoso, supra, 183 Cal.App.3d at p. 998.) We find the other two cases on which the trial court chose to rely, Bott and Green, inapposite.


The critical issue for us to determine is whether the allegations of the amended complaint demonstrate that as a matter of law TCM was amenable to service of process during the limitations period because it had the requisite minimum contacts so as to be deemed to be doing business here. "`We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law.'" (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) We find Marquez's allegations to be contradictory in this regard. On the one hand he alleges that TCM was never present in the state and never engaged in intrastate or interstate commerce, but he also alleges that at all times TCM has been engaged in the trade, business, commerce, manufacture, marketing and distribution of forklifts and component parts for forklifts; that it presented to the public, specifically including Marquez, that it was a skillful, careful and diligent forklift manufacturer; that its forklifts were merchantable and fit for intended use by the public, including Marquez; and that Marquez was a foreseeable user who relied on these implied warranties.


Because the complaint otherwise shows on its face that the action is barred by the statute of limitations, Marquez has the burden of pleading facts to show tolling under section 351. (Bass v. Berry (1876) 51 Cal. 264; Sullivan v. Shannon (1938) 25 Cal.App.2d 422, 428; 5 Witkin, Cal. Procedure (4th ed. 1997) Pleading, ยง 885, p. 344.) He fails to do so; these ambiguous and conflicting allegations fail to establish TCM was not doing business in this state. However, neither do these allegations establish, as a matter of law, that TCM was doing business in this state so as to be subject to service under the long-arm statute. It is alleged that TCM placed the subject forklift in the stream of commerce, but a defendant's placing a product in the stream of commerce is not a sufficient basis for personal jurisdiction; due process requires that the defendant's actions be purposefully directed at the forum state. (Asahi Metal Industry Co. v. Superior Court (1987) 480 U.S. 102 (Asahi).) It may be that TCM does not do business regularly here, and that the presence of the forklift in California was the result of an isolated transaction. If so, then there would be no basis to assert jurisdiction over TCM. (Bridgestone Corp. v. Superior Court (2002) 99 Cal.App.4th 767, 775 ["The foreseeability that the defendant's product will cause injury in the forum state due to an isolated incident does not establish purposeful availment"].)


In summary, we conclude that the trial court erred in overruling the demurrer because the allegations do not clearly establish that TCM did not do business in California for purposes of establishing its amenability to service of process. If Marquez can truthfully allege facts showing it was not amenable to service of process, the trial court may grant him leave to amend. We point out that this issue ultimately may have to be resolved on the basis of facts proved on summary judgment motion or at trial rather than at the pleadi

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