Reply Brief — Christovao v. Unisul-Uniao De Coop. Transf. De Tomate Do Sul Do Tejo

Supreme Court, U. $

ED

OcT 25 i977

SHtahe soar, JR., CLERK

Supreme Court of the United

Ocroser Term, 1977

No. 77-222

Josern Curstovao, d/b/a Mercantum Traprve Company,

Petitioner,

v8.

Unssut-Unsmo De Coop. Transr. De Tomate Do Sut De

Tezyo, §S.C.R.L.; Coopzratrva Transrormapora Dos

Propuctos Acricotas Do Vate Do Sorram, 8.C.R.L.;

Coorrrativa Acricora Do Vatze Do Sapo, §.C.R.L.;

Coorzrattva Horto-Frutico.a Do Roxo, §.C.R.L.;

Coorzrattva Acricota Do Mma, S8.C.R.L.,

Respondents,

and

AtTToRNEY GENERAL OF THE State oF New York,

Intervenor.

JonaTHan S. Garni

Cownsel for Petitioner

225 Broadway

New York, N. Y. 10007

(212) 964-8181

Of Counsel:

Vrro Viscenti

Vuscent: & ScHIckLzr

TABLE OF CONTENTS

PAGE

A 1-9

Cases Cited

Fitzgerald v. Texaco, Inc., 521 F.2d 448 (2d Cir.

1975) cert. den. 423 U.S. 1052 (1976) -...002... 7

Gregonis v. Philadelphia & Reading C & I Co., 235

| 6

Gulf Oil Corp. v. Gilbert, 330 U. S. 501 (1947) ......... 3, 5,9

International Milling Co. v. Columbia Transporta-

| renner 3,9

Irrigation and Industrial Development Corporation

v. Indag, 37 N. Y. 2d 522; 337 N. E. 2d 749, 375

TIE III it cecienssessensntnceecsesnsisssecsersncsensnesesee 4,5

Koster v. Lumberman’s Mutual Casualty Co., 330

EE 3, 5, 9

Missouri ex rel Southern Railroad Ry. Co. v. May-

Ee 6

Mollendo Equip. Co. v. Sekisan Trading Co., 7 A. D.

2d 750, 392 N.Y.S. 2d 427 (1st Dept. 1977) —.......... 4,5

Mondue v. New York, N.H. & H.R. Co., 223 U.S. 1

acerca ten dtteriesnctnsinescenesccnnecesncscceeenmecsoe

Norwood v. Kirkpatrick, 349 U.S. 29 (1955) _0.000..... 3,9

Ortwein v. Schawb, 410 U.S. 656 (1973) 20000.

United States v. Kras, 409 U.S. 434 (1973) 2000. 8

ii TABLE OF CONTENTS

PAGE

Vanity Fair Mills v. T. Eaton Co., 234 F.2d 633 (2d

Cir. 1956) cert. den. 352 U.S. 871 (1956) -........... 7

William v. Green Bay & Western Railway Co., 326

U.S. 549 (1946) 3

Yerostathis v. A. Luisi, Ltd., 380 F.2d 377 (9th Cir.

1967) . 7

United States Constitution Cited

SOIREE OIG | sisciteicvsicscictinatciitnintaianiarineteen 6

Portugal Constitution Cited

Articles 10, 82, 84, 86 5

Rule Cited

New York Civil Practice Law:

R. 327 .. 2-4, 8,9

Other Authorities Cited

Barrett, The Doctrine of Forum Non Conveniens, 35

California L. Rev. 380 (1947) 4

Blair, The Doctrine of Forum Non Conveniens in

Anglo-American Law, 29 Columbia L. Rev. (1929) 4

Jones, Forum Non Conveniens, 54 Texas L. Rev. 737

(1976) 4

Restatement, Second, Conflict of Laws, Comment f

(Proposed Official Draft, Pt. 1. 1967):

Sec. 84

TABLE OF CONTENTS ili

PAGE

R. Weintraub, Commentary on the Conflict of potion

157 (1971) 4

Ryan & Berger, Forum Non Conveniens in Califor-

nia, 1 Pacific L.J. 532 (1970) -..............-----0---s-seeneeeoes 4

IN THE

Supreme Court of the United States

Octoser TERM, 1977

No. 77-222

—<>—

JosePpH CuHuisTovao, d/b/a Mercantum Trapinc Company,

Petitioner,

vs.

Unisut-Unirao De Coop. Transr. De Tomate Do Sut Do

Tezo, §S.C.R.L.; Cooperativa Transrormapora Dos

Propuctos Acricotas Do Vate Do Sorraia, 8.C.R.L.;

CooperativA AcGricota Do Vate Do Sapo, S8.C.R.L.;

Coorerativa Horto-Fruticora Do Roxo, S.C.R.L.;

Cooperativa Acricota Do Mira, S.C.R.L.,

Respondents,

and

ATTORNEY GENERAL OF THE STATE OF New York,

Intervenor.

PETITIONER’S REPLY BRIEF

There is no more fundamental interest than the right

of an individual to be able to seek redress for wrongs

committed to him in a court with proper jurisdiction.

2

Mondue v. New York, N.H. & H.R. Co., 223 U.S. 1, 58

(1911). This right is basic to our judicial system and

before ‘ 1at to the common law which arose in the English

judicial system. Petitioner is being denied this funda-

mental right through the application of Rule 327 of the

Civil Practice Law and Rules of the State of New York.

Petitioner, a long standing resident of the State of New

York, sought to avail himself of the use of the courts of

his state to recover for wrongful acts committed against

him by Respondents.

In spite of the fact that Petitioner was a resident, that

both personal* and quasi in rem jurisdiction was obtained

over Respondents by personal service of the summons

and complaint and the court ordered attachment within

the State of New York of obligations due Respondents,

that the causes of action against Respondents arose out

of business being conducted by Respondents within the

State of New York, and New York law would apply, the

Court below dismissed Petitioner’s complaint before a

hearing and the giving of evidence could take place upon

the ground of forum non conveniens. Moreover, Peti-

tioner is not just being forced to seek redress for dam-

ages in another state which is subject to the guarantees

of a fair trial and due process under this country’s Con-

stitution, but is being required to travel 6,000 miles to

a foreign jurisdiction where, at best, it is questionable

Petitioner can obtain a fair trial and receive due process.

Petitioner does not deny the power of a court to utilize

the doctrine of forum non conveniens in proper cireum-

stances. Rather, Petitioner contends that the New York

Courts, in applying the New York Statutes in this case,

have acted arbitrarily and in violation of Petitioner’s

* See footnote on page 16 of Petition for Writ ef Certiorari.

3

rights under the due process clause of the United States

Constitution. The precepts for the application of the

doctrine have been laid out in the bench mark decisions

of this Court in Gulf Oil Corp. v. Gilbert, 330 U.S. 501

(1947) and Koster v. Lumberman’s Mutual Casualty Co.,

330 U.S. 518 (1947). The decision in Gulf Ou v. Gilbert,

supra, states that the doctrine of inconvenient forum

should be applied only in “exceptional circumstances”.

The record is clear that no exceptional circumstances ex-

ist. Indeed, the application of Rule 327 by the Court

below is contrary to all of the principles set forth by this

Court in its prior decisions concerning the application of

forum non conveniens. International Milling Co. v. Co-

lumbia Transportation Co., 292 U.S. 511 (1934); Williams

v. Green Bay & Western Railway Co., 326 U.S. 549

(1946); Gulf Oil Corp. v. Gilbert, supra; Koster v. Lum-

berman’s Mutual Casualty Co., supra; Norwood vy. Kirk-

patrick, 349 U.S. 29 (1955).

The principles outlined by this Court have not been fol-

lowed and the Petitioner is being denied due process. This

Court aply stated in Gulf Oil Corp. v. Gilbert, supra, (at

p. 508 of 330 U.S.):

“But unless the balance is strongly in favor of the

defendant, the plaintiff's choice of forum should

rarely be disturbed”.

The mere inconvenience of the defendant is insufficient.

“E]ven where the cause is transitory and the plain-

tiff a resident of the forum state, the convenience to

the Court would seem to be outweighed by its duty

to entertain actions by it of citizens of the state of

which the court is in arm.” Koster v. Lumberman’s

Mutual Casualty Co., supra, 535.

The Petitioner is a long time resident of the State

of New York. The doctrine of forum non conveniens

has uniformly never been applied by a state court to

its own resident and taxpayer prior to its unique appli-

cation by the courts of New York. See Restatement,

Second, Conflict of Laws §84, Comment f (Proposed Ofi-

cial Draft, Pt. I. 1967); Blair, The Doctrine of Forum

Non Conveniens in Anglo-American Law, 29 Columbia L.

Rev. (1929); Barrett, The Doctrine of Forum Non Con-

veniens, 35 California L. Rev. 380 (1947); Rvan & Berger,

Forum Non Conveniens in California, 1 Paeifie LJ. 532

(1970); R. Weintraub, Commentary on the Conflict of

Laws, 157 (1971); Jones, Forum Non Conveniens, 54

Texas L. Rev. 737 (1976). Respondents and the Inter-

venor fail to refer this Court to a single decision where

a state court has applied forum non conveniens against

its own resident-plaintiff prior to the unprecedented deci-

sions of the New York Courts. With the adoption of

Rule 327 of the New York Civil Practice Law and Rules,

the Courts of New York have now, apparently, determined

to summarily dismiss actions by its residents upon this

ground. [See /rrigation and Industrial Development Cor-

poration v. Indag, 37 N. Y. 2d 522; 337 N. . 2d 749,

375 N.Y.S. 2d 296 (1975); Mollendo Equip. Co. v. Sekisan

Trading Co., 7 A. D. 2d 750, 392 N.Y.S. 2d 427 (1st Dept.

1977) }.

The fact of Petitioner’s residency in New York, how-

ever, does not stand alone as the basis for his contention

as to constitutional repugnancy. This lawsuit involves

entirely the relationship between Petitioner as exclusive

representative for the sale of Respondents’ products in

the United States, and the definition of that relationship.

One cause of action is for nothing more than commissions

earned for sales in the United States and Canada (2).*

* Figures in parentheses refer to the record on appeal.

ae SS

All Respondents’ sales were conducted throug! Petitioner,

whose business has at all times been located in New York

(1, 81). The bulk of the suit involves the right of Ie-

spondents to sell to customers located throughout the

United States cultivated by Petitioner (2, 81, 158). Re-

spondents’ business in the United States involved their

participating in arbitrations and hearings in various tri-

bunals in the United States (145-147). At present, they

maintain an action integrally related to this one against

a corporation owned by Petitioner in the Federal District

Court, literally across the street from the State Court

which dismissed this action (140-145). Respondents do

the overwhelming bulk of their business internationally

and more than one-third of if has been done in the Urited

States through Petitioner’s business in New York (158).

The law applicable is that of the State of New York.

The central witnesses are primarily located in the State

of New York. None of these factors were present in the

Irrigation and Mollendo cases, supra. Accordingly,

apart from the novelty of the application by the Courts

of the State of New York of the doctrine in the case of

a plaintiff resident, in this action those Courts have ap-

plied it in a situation and in such a manner as is at odds

with even their most recent decisions under the Statute

and clearly transgresses the principles laid down by this

Court in the Gulf Oil and Koster cases, supra.

Moreover, not only is it questionable that Petitioner can

obtain a fair trial and due process in the foreign juris-

diction but there is also question as to the enforceability

of any judgment obtained in that foreign jurisdiction,

since the Constitution of Portugal expressly favors Re-

spondents and authorizes nationalization and expropria-

tion in favor of Respondents (see Petition, pp. 10-11,

Articles 10, 82, 84 and 86 of the Portuguese Constitution).

6

Petitioner respectfully submits that it is now appro-

priate and urgent for this Court to determine the con-

stitutional perameters of the application of the doctrine

and this case uniquely raises this issue. Certainly dis-

missal of an action of a plaintiff resident on grounds of

the doctrine directly raises the question of its effect upon

the Fourteenth Amendment of the United States Constitu-

tion. [See Gregonis v. Philadelphia & Reading C & I Co.,

235 N.Y. 152, 1389 N.E. 223 (1923)].

Respondent brief is of no substance. It merely sets

forth poreedural arguments as to why this Court should

not entertain certiorari. These procedural arguments, even

if true, should not be a ground for a denial of certiorari

where such a basic right is to access to the courts of

one’s own jurisdiction is at issue. Respondent brief fails

to deal with any of the substantive aspects of the petition.

The brief of the Intervenor is misleading and misapplies

the decisions referred therein. It also fails to respond to

any of the substantial questions raised by the petition. It

is asserted by the Intervenor in his brief (at p. 4) that the

decision of the Court below is not subject to review. Inter-

venor then refers to Missouri ex rel Soulhern Railroad

Ry. Co. v. Mayfield, 340 U.S. 1 (1950). The Intervenor

misleads this Court as to the applicability of the Missouri

case and misquotes from it. What this Court said in

Missouri is that a state court may prefer access to its

courts by its residents over non-residents. Specifically,

this Court said in Missouri the following (at p. 4 of 340

U.S.):

“But if a State chooses to ‘[prefer] residents in

access to often overcrowded Courts’ and to deny

such access to all non-residents, whether its own

citizens or those of other States, is a choice within

its own control”.

This Court then went on to say that such a choice of its

residents over non-residents is not open to review here.

The word “choice” refers to the state court’s preference

of its own residents over non-residents. The Intervenor

has extended this to apply to all cases of forum non con-

veniens including the denial of access of a state court of its

own resident plaintiff.

The other decisions referred to by the Intervenor in his

brief are not applicable to the questions raised on this

petition. Fitzgerald v. Texaco, Inc., 521 F.2d 448 (2d Cir.

1975) cert. den. 423 U.S. 1052 (1976); Yerostathis v. A.

Luisi, Ltd., 380 F.2d 377 (9th Cir. 1967); Vanity Fair

Mills v. T. Eaton Co., 234 F.2d 633 (2d Cir. 1956) cert.

den. 352 U.S. 871 (1956) referred to by the Intervenor in

his brief (at p. 4) are not in point. Fitegerald was

brought under the Federal Maritime laws by the estate

of a German national seeking recovery because of an

accident at sea between a German ship and a Panamanian

ship. There was already pending in the courts of Eng-

land substantial litigation between the German ship and

the Panamanian ship over this accident. There is noth-

ing in the decision to indicate that the plaintiff was a

long standing resident of tle jurisdiction of the Court,

if at all. The Court applied forum non conveniens be-

cause of the existing litigation in the courts of Mngland.

Moreover, although it is not expressly stated in the deci-

sion, since the plaintiff is not a citizen of this country, the

Federal Court would not have had jurisdiction except by

reason of the Federal Maritime Statute. Likewise, Yero-

stathis was an admiralty case involving a non-resident

foreign national and a foreign ship under the Federal

Maritime iaws.

In Vanity Fair a special situation arose. It involved a

claim by an American corporation with respect to the en-

8

forcement of a trademark infringement in a foreign juris-

diction. The question was really one of jurisdiction and

whether the Federal Court could enjoin a foreign national

as to activities in a foreign jurisdiction. Because of this

the Federal Court dismissed the complaint holding that

it was more appropriate for plaintiff to seek his injunc-

tion in the foreign jurisdiction where it could be enforced.

At bar, Petitioner is seeking recovery for acts committed

within the State of New York and there is a court ordered

attachment in the sum of $122,000 from which judgment

could be satisfied. Incidentally, if Respondents prevail,

the attachment will be vacated and Respondents will re-

ceive the $122,000. No provision was made by the Court

below to maintain this fund and it is very likely that once

the attachment is vacated, Petitioner will never be able to

satisfy any judgment he could obtain.

Intervenor’s brief fails to set forth a single decision

where there was the dismissal upon facts similar to this

action, involving a resident, where the Court had personal

and quasi in rem jurisdiction, where the cause of action

arose in the jurisdiction and where the law of the forum

state was to be applied.

United States v. Kras, 409 U.S. 434 (1973); Ortwein v.

Schawb, 410 U.S. 656 (1973) have no applicability here.

Those cases involved plaintiffs who could not afford to

pay fees appropriately required by the courts. No such

situation exists here. The Petitioner has paid any appli-

cable court fees and is willing to pay all future court fees

to prosecute his claims against Respondents. Petitioner is

not contending that under no circumstances can a court

deny access by reason of necessary fees to its residents.

What Petitioner contends is that the application of Rule

327 and the doctrine of forum non conveniens by the Court

below is unconstitutional.

————————

9

It is asserted in Intervenor’s brief (at p. 5) that the

Petitioner is seeking to have this Court review a factual

determination of a state court. This is not the case. What

Petitioner seeks is a review of the application of Rule 327

and forum non conveniens by the Court below because it

violates the tenets laid down by this Court in /nternational

Milling Co. v. Columbia Transportation Co., supra; Gulf

Oil Corp. v. Gilbert, supra; Noster v. Lumberman’s Mutual

Casualty Co., supra; Norwood vy. Kirkpatrick, supra.

The petition has raised substantial questions which

should concern this Court. As a result of the application

of Rule 327, the Courts of the State of New York are arbi-

trarily denying access to its residents on an alarming

basis. In most cases, access is being denied merely because

the resident was doing business with a foreign national

without regard as to the principles set down by this Court

and whether the resident can obtain a fair trial and due

process.

The petition for a writ of certiorari should be granted.

Respectfully submitted,

JONATHAN S. GAYNIN

Co nsel for Petitioner

225 Broadway

New York, N. Y. 10007

(212) 964-8181

Of Counsel: =

Vito VINCENTI

Vincenti & ScHICKLER