Hatzenbuehler v. Essig

BRIGITTE HATZENBUEHLER, Appellant v. JENS ESSIG, Appellee

NO. 01-16-00515-CV

Court of Appeals For The First District of Texas

May 23, 2017

On Appeal from the 11th District Court Harris County, Texas

Trial Court Case No. 2015-11871

OPINION

This appeal from a special appearance arises out of a dispute between German citizens concerning the provenance of a cauldron discovered in a Bavarian lake. Josef Hatzenbuehler sued Jens Essig, alleging that Essig and others falsely represented the cauldron to be of ancient Celtic origin. With Essig's assistance, Josef purchased the cauldron at a Swiss bankruptcy sale. Josef alleged that he later discovered that the cauldron was likely created by the Nazis in the 1940's, making it significantly less valuable.

Josef died during the pendency of the suit and his widow, Brigitte Hatzenbuehler, succeeds him as plaintiff. The live pleading alleges that Essig committed fraud, fraudulent inducement, negligent misrepresentation, and breach of contract in connection with the cauldron transaction.

Essig specially appeared, contending that the trial court lacked personal jurisdiction over him. The trial court agreed, granted the special appearance, and dismissed the suit.

Brigitte Hatzenbuehler appeals, contending that the trial court erred in granting the special appearance. We affirm.

Background

During the relevant time period, the Hatzenbuehlers resided in Texas, but they returned to Germany to visit family and friends during holidays. Essig, a resident of Germany, has never visited Texas and has no property or agents in Texas.

According to the pleadings, Essig and others discovered an artifact known as the Chiemsee Cauldron while exploring a Bavarian lake. The cauldron reportedly was of pre-Christian, Celtic origin. Starting in 2008, Josef discussed the discovery of the cauldron several times with Essig during the Hatzenbuehlers' annual holidayvisits to Germany. Josef, a collector of antiques and artifacts, expressed an interest in acquiring the cauldron. He requested information concerning its authenticity and value. Essig told him that the cauldron was in the possession of a bankruptcy estate in Switzerland and was to be sold at the estate auction in Switzerland.

Josef and Essig continued phone and e-mail contact through 2014. Throughout this period, during which Josef resided in Houston and Essig in Switzerland, Essig repeatedly represented that the cauldron was authentic and of great value. In March 2014, Essig sent an e-mail to Josef confirming he had materials that authenticated the cauldron and its value. Essig informed Josef that Essig had been qualified to place a bid on the cauldron as a creditor of the Swiss bankruptcy estate. Essig and Josef discussed an assignment of Essig's bidding rights to Josef so that Josef could acquire the cauldron at the Swiss auction.

Josef, while in Houston, drafted a Letter of Intent to share profits earned on the cauldron's sale. The parties signed the LOI on or about April 13, 2014. The letter of intent declared that it was non-binding, but it outlined the parties' understanding that

• Josef would bid on the cauldron with the intent of purchasing it and gaining sole ownership of it;

• Essig would assist Josef in obtaining the winning bid;

• Essig would provide Josef with a list of all information in his possession concerning the cauldron, including reports, tests, specifications,articles, and agreements, for the purpose of determining a bid ceiling; and

• The parties would each earn 50% of the profits, less costs and expenses incurred by Josef in connection with the acquisition, holding, and subsequent sale of the cauldron.

Later that month, the parties circulated a draft profit-sharing agreement, which provided for the application of Texas choice-of-law rules and includes Texas venue provisions. The draft agreement was never executed.

About a month after the parties signed the non-binding LOI, in May 2014, the Hatzenbuehlers traveled to Zurich, Switzerland, to view the cauldron and meet with Essig and others, including Josef's Swiss attorney. By that time, the Hatzenbuehlers had heard rumors in Germany and Switzerland that the cauldron was not of ancient Celtic origin, but instead had been created by the Nazis, who dumped the cauldron in the Bavarian lake in 1945. Essig assured the Hatzenbuehlers "many times during the trip to Zurich" that the cauldron was of ancient Celtic origin and that experts would confirm its provenance. Josef decided to proceed with the purchase and told those present that, after he purchased the cauldron, he planned to ship it to Houston for marketing in the United States because of the rumors in Germany and Switzerland that its provenance was suspect.

Essig and Josef then negotiated a Preliminary Agreement to address the acquisition of the cauldron. They had a German attorney draft the agreement and forward the draft to Josef in Houston. Josef then traveled to Munich, Germany tosign it. The Preliminary Agreement, which expressly replaced the letter of intent, recited that "both parties are Germans" and that it is made "according to German Law." According to its terms,

• Essig assigned to Josef Essig's right to bid at the Swiss auction;

• Josef became the sole owner of the cauldron upon his purchase of it and had the sole right to decide its location;

• Essig promised to give Josef, when required, all of the available expertise and reports, work results, and investigation materials relating to the cauldron;

• Josef assumed all acquisition and storage costs for the cauldron;

• Josef retained sole control concerning the cauldron's transport to the United States and its storage; and

• Essig's 50% net share of profits from the cauldron's sale would be distributed after deduction of costs incurred by Josef in acquiring, storing, and selling the cauldron, plus 10% interest for Josef's costs and expenses.

The draft initially proposed that the parties would mutually decide where the cauldron would be stored, but Essig did not agree to that provision and struck the proposed language before he signed it. Essig signed the Preliminary Agreement after Josef wrote his initials by the stricken language to denote his acceptance of that modification. No agreement addressing the holding, marketing, and subsequent sale of the cauldron after the auction was ever executed by the parties.

The auction of the cauldron took place on July 4, 2014 in Zurich, Switzerland. Josef, acting through a Texas corporation that he had created for the purpose, won the auction and bought the cauldron. The Swiss bankruptcy estate transferredownership of the cauldron directly to Josef in Switzerland by executing a Sale of Cauldron Agreement, which was prepared in German, with Josef to take sole ownership and possession of the cauldron in Switzerland. The Sale Agreement does not mention Essig or confer any rights on Essig. It reflects that Josef ["the Buyer"] would take full responsibility for the cauldron's removal and transport. Josef had declared that the cauldron was "not intended for the Swiss market," and would be "shipped abroad," but had not identified any specific market. Josef arranged to transport the cauldron he then owned to Texas.

Several weeks after the auction, the Hatzenbuehlers discovered that several years earlier, eight experts had examined the cauldron in connection with a lawsuit. Those experts uniformly had concluded the cauldron was not of ancient Celtic origination, but was more recently created. Essig had reason to know of those experts' findings before he entered into the agreement with Josef, but he never told Josef about them.

Numerous disputes between the parties led to this suit, which Josef brought against Essig in Harris County District Court. Essig filed a special appearance. In an accompanying affidavit, Essig averred that he (1) has no offices in Texas; (2) has no property in Texas; (3) pays no taxes in Texas; (4) has no employees in Texas; (5) does not advertise in Texas; (6) has never visited or traveled to Texas; (7) does not conduct business in Texas; and (8) has no agent for service of process in Texas.Josef responded that Essig had purposefully availed himself of engaging in business in Texas by entering into a business deal with a Texas resident with the intention of reselling the cauldron in Texas and that, through their communications, Essig had established minimum contacts with Texas sufficient to establish grounds for specific personal jurisdiction.

SPECIAL APPEARANCE

A. Standard of Review

Whether a court has personal jurisdiction over a nonresident defendant is a question of law we review de novo. Moncrief Oil Int'l Inc. v. OAO Gazprom, 414 S.W.3d 142, 150 (Tex. 2013). When a defendant challenges the exercise of personal jurisdiction in a special appearance, the plaintiff and the defendant bear shifting burdens. Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653, 658 (Tex. 2010). The plaintiff bears the initial burden of pleading allegations that bring a nonresident defendant within the provisions of the Texas long-arm statute. BMC Software Belg., N.V. v. Marchand, 83 S.W.3d 789, 793 (Tex. 2002). If the defendant meets that burden, the burden shifts to the nonresident defendant to negate all bases of jurisdiction alleged by the plaintiff. Kelly, 301 S.W.3d at 658: Glattly v. CMS Viron Corp., 177 S.W.3d 438, 446 (Tex. App.—Houston [1st Dist.] 2005, no pet.).

The trial court must frequently resolve fact questions before deciding the jurisdictional question. BMC Software, 83 S.W.3d at 794. In this case, however,the parties do not dispute the relevant jurisdictional facts, only their application to the law.

When, as in this case, a trial court does not issue findings of fact or conclusions of law, we imply all relevant facts necessary to support the judgment if the evidence supports them. Moncrief Oil, 414 S.W.3d at 150. We will affirm the trial court's ruling on any legal theory that finds support in the record. Dukatt v....