Heath v. Estate of Bryan Wayne Heath et al

Filing 25

MEMORANDUM OPINION AND ORDER FINDING AS MOOT 20 MOTION to Strike. A separate Order will be entered dismissing all claims against Defendants Linda Heath and Zachary Heath. Signed by Judge James H Hancock on 7/30/14. (JLC)

FILED
2014 Jul-30 AM 09:22
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
CHRISTY JAMES HEATH,
PLAINTIFF,

)
)

VS.

)

ESTATE OF BRYAN WAYNE,
HEATH, et al.

2:14-cv-610-JHH

)
)

DEFENDANT.

)

MEMORANDUM OPINION AND ORDER
The court has before it the Special Appearances and Motions to Dismiss for
Lack of Personal Jurisdiction filed by Linda Heath (Doc. #10) and Zachary Heath
(Doc. #12) on April 15, 2014 and April 21, 2014, respectively, as well as the Motion
(Doc. #20) to Strike Affidavit filed by Linda and Zachary Heath on May 14, 2014.
Pursuant to the orders (Docs. #11, 13, 22) of the court, the Motions (Docs. #10, 12,
20) have now been fully briefed and are properly before the court for review.
I.

Background and Relevant Facts
On April 2, 2014, this case was removed to this court by Defendant Principal

Life Insurance Company (“Principal Life”).

(See Doc. #1).

The state court

complaint, filed on February 18, 2014 alleges: breach of contract (Count One); civil
contempt (Count Two); breach of fiduciary duty and conspiracy (Count Three); unjust
1

enrichment against defendants Linda Heath and Zachary Heath (Count Four);
tortuous interference with contract (Count Five); breach of professional responsibility
by defendants Wayne Heath and Heath Financial Services (Count Six); civil
conspiracy (Count Seven); outrageous conduct (Count Eight); claims against
Principal Life Insurance Company (Count Nine); and equitable relief (Count Ten).
(See Doc. #1, Exh. A). Of those claims, three are directed against defendants Linda
and Zachary Heath: Count Four for unjust enrichment, Count Five for tortuous
interference, and Count Seven for civil conspiracy.
The claims center on the pursuit of the proceeds of an insurance policy.
Plaintiff Christy James Heath married Bryan Wayne Heath on November 2, 2001.
Two children were born into the marriage – James Matthew Heath on December 17,
2003 and Ellen Tyler Heath on June 23, 2005. (See Doc. #1, Exh. A at ¶ 4). Prior to
the birth of their first child, the Plaintiff and Bryan Heath each took out life inusrance
policies through defendants Wayne Heath and Heath Financial, Inc. on their
respective lives in the amount of $2 million dollars, and named each other as
beneficiaires thereof. (See id. at ¶¶ 5, 6).
Plaintiff instituted divorce proceedings against Bryan Heath in the Circuit
Court of Jefferson County, Alabama, Domestic Relations Division in 2011. On or
about November 29, 2011, the parties entered into an Agreement in the divorce action
and on December 15, 2011 the court entered an Order adopting the parties’
2

Agreement. (See id. at ¶ 8). The Agreement and Order created an equitable and/or
constructive trust over the life insurance proceeds in favor of the survivor of the
parties to the divorce action: “Both parties shall maintain the life insurance on his or
her life, Pendente Lite, and shall make no changes of beneficiaries during the
pendency of this matter.” (Id. at ¶ 9). Plaintiff alleges that while the Pendente Lite
order was in effect, defendant Bryan Heath changed the beneficiaries of the $2
million insurance policy on his life on two different occasions. (See id. at ¶ 10). At
the time of the last beneficiary change, the benficiaries were named as: James
Matthew Heath and Ellen Tyler Heath as twenty-five percent (25%) beneficiaries and
Zachary Heath and Linda Heath as twenty-five percent (25%) beneficiaries,
respectively. (See id.). As such, Plaintiff alleges that defendants Zachary and Linda
Heath received insurance benefits to which they were not entitled in the amount of
$500,000 each. (See id. at ¶ 12).
II.

Standard of Review
A Rule 12(b)(2) motion tests the court's exercise of personal jurisdiction over

a defendant. See FED. R. CIV. P. 12(b)(2). "A plaintiff seeking the exercise of
personal jurisdiction over a nonresident defendant bears the initial burden of alleging
in the complaint sufficient facts to make out a prima facie case of jurisdiction."
United Techs. Corp. v. Mazer, 556 F.3d 1260, 1274 (11th Cir.2009); see also Posner
v. Essex Ins. Co., 178 F.3d 1209, 1214 (11th Cir.1999) ("A plaintiff seeking to obtain
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jurisdiction over a nonresident defendant initially need only allege sufficient facts to
make out a prima facie case of jurisdiction."). If the plaintiff satisfies her initial
burden and the defendant then challenges personal jurisdiction by submitting affidavit
evidence in support of its position, the burden traditionally shifts back to the plaintiff
to produce evidence supporting jurisdiction. See Meier ex rel. Meier v. Sun Int'l
Hotels, Ltd., 288 F.3d 1264, 1268 (11th Cir.2002); see also Posner, 178 F.3d at 1214
("The plaintiff bears the burden of proving 'by affidavit the basis upon which
jurisdiction may be obtained' only if the defendant challenging jurisdiction files
'affidavits in support of his position.'" (citation omitted)). When the issue of personal
jurisdiction is decided on the evidence, but without a discretionary hearing, a plaintiff
demonstrates a "prima facie case of personal jurisdiction" by submitting evidence
sufficient to defeat a motion made pursuant to Rule 50(a) of the Federal Rules of
Civil Procedure. See Snow v. DirecTV, Inc., 450 F.3d 1314, 1317 (11th Cir.2006).
At this evidentiary juncture, the court construes the complaint's allegations as true if
they are uncontroverted by affidavits or deposition testimony, id. at 1317, and where
there are conflicts, the court "construe[s] all reasonable inferences in favor of the
plaintiff." Whitney Info. Network, Inc. v. Xcentric Ventures, LLC, 199 Fed. Appx.
738, 741 (11th Cir.2006) (quoting Meier, 288 F.3d at 1269).
III.

Analysis of the Motions to Dismiss on Personal Jurisdiction Grounds
The determination of personal jurisdiction over a nonresident defendant
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requires a two-part analysis. See Cable/Home Communication Corp. v. Network
Productions, Inc., 902 F.2d 829, 855 (11th Cir.1990); see also Alexander Proudfoot
Co. World Headquarters L.P. v. Thayer, 877 F.2d 912, 919 (11th Cir. 1989). First,
the jurisdictional question under the state long-arm statute is considered. See
Cable/Home Communication Corp., 902 F.2d at 855; see also Alexander Proudfoot
Co., 877 F.2d at 919. If there is a basis for the assertion of personal jurisdiction under
the state statute, that is, minimum contacts with the forum, the next determination to
be made is whether sufficient minimum contacts exist to satisfy the Due Process
Clause of the Fourteenth Amendment so that "maintenance of the suit does not offend
'traditional notions of fair play and substantial justice.'" International Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463
(1940)); see also Cable/Home Communication Corp., 902 F.2d at 855; Alexander
Proudfoot Co., 877 F.2d at 919. The nature and quality of the contacts may vary
depending on whether the type of jurisdiction being asserted is specific or general.
See Consolidated Dev. Corp. v. Sherritt, Inc., 216 F.3d 1286, 1291 (11th Cir. 2000).
Only if both prongs of the analysis are satisfied may a federal or state court exercise
personal jurisdiction over a nonresident defendant.
The reach of the Alabama long-arm statute is a matter of Alabama law. Federal
courts are required to construe it as would the Alabama Supreme Court. See Oriental
Imports & Exports, Inc. v. Maduro & Curiel's Bank, N.V., 701 F.2d 889, 890-891
5

(11th Cir. 1983). Alabama's long-arm statute permits personal jurisdiction to the
extent it "is not inconsistent with the constitution of this state or the Constitution of
the United States." ALA. R. CIV. P. 4.2(b). Thus, the question here is whether
assertion of personal jurisdiction over the individual defendants comports with the
Fourteenth Amendment's Due Process Clause. See Olivier v. Merritt Dredging Co.,
Inc., 979 F.2d 827 (11th Cir. 1992) (citing Alabama Waterproofing Co., Inc. v.
Hanby, 431 So.2d 141, 145 (Ala. 1983)).

Compliance with the Fourteenth

Amendment's Due Process Clause exists where the defendant has minimum contacts
with the forum state, and where the exercise of personal jurisdiction does not offend
"traditional notions of fair play and substantial justice." Olivier, 979 F.2d at 830-831;
Madara v. Hall, 916 F.2d 1510, 1516 (11th Cir. 1990) (quoting International Shoe,
326 U.S. at 316).
There are two types of personal jurisdiction: specific and general. Specific
jurisdiction is based on a party's contacts with the forum state that arise out of or are
related to the cause of action. See Helicopteros Nacionales de Colombia, S.A. v. Hall,
466 U.S. 408, 414 n.8 (1984); see also Consolidated Dev., 216 F.3d at 1291. General
contacts consist of the defendant’s contacts with the forum state that are unrelated to
the cause of action and that are both “continuous and systematic.” Helicopteros
Nacionales de Colombia, 466 U.S. at 415. Plaintiff alleges that this court has both
specific and general personal jurisdiction over Linda and Zachary Heath. (See Doc.
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#17 at 1) (“First, based on Plaintiff’s allegations of both defendants’ purposeful
conspiratorial activity aimed at Plaintiff, who is an Alabama resident, personal
jurisdiction has been established. Furthermore, there is sufficient evidence of the
Defendants’ general contacts in the state of Alabama . . .”). Each jurisdictional
allegation will be considered in turn.
A.

General In Personam Jurisdiction

Plaintiff alleges that “there is sufficient evidence of the Defendants’ contacts
with the State of Alabama” such that personal jurisdiction can be established. (Doc.
#17 at 1). The general contacts alleged for each individual defendant will be
considered in turn.
1.

Zachary Heath

Plaintiff Christy Heath, by way of affidavit, makes the following assertions
about Zachary Heath’s general contacts with Alabama: he gave Bryan Heath $10,000
as an investment in Riverwoods, LLC, an Alabama business (that owns property in
Liberty Park, Vestavia Hills, Alabama); he has received medical treatment in
Alabama; he has belonged to various hunting clubs in Alabama; and he retained an
attorney in Alabama regarding his appointment as personal representative for Bryan
Heath’s estate in Jefferson County Probate Court. (See Doc. #17 at 5).
The affidavit is the subject of a Motion (Doc. #20) to Strike. The jurisdictional
allegations made by Plaintiff which are related to Zachary Heath include some which
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are due to be stricken based on Plaintiff’s lack of personal knowledge. In Paragraph
13 of her affidavit, Plaintiff states her “belief” that Zachary received medical
treatment in Alabama1 and her “knowledge” that Zachary belonged to hunting clubs
in Alabama, yet she states no basis for this knowledge or belief. (See Doc. #17-1 at
¶ 13). These conclusions are made without any asserted basis in fact. See FED. R.
CIV. P. 56(c)(e) (“An affidavit or declaration used to support or oppose a motion must
be made on personal knowledge, set out facts that would be admissible in evidence,
and show that the affiant or declarant is competent to testify on the matters stated”);
see also Ex parte Head, 572 So.2d 1276 (Ala. 1990) (an affidavit must be made on
personal knowledge and set forth such facts as would be admissible in evidence).
Therefore, they are due to be stricken from the record.
However, even were the court to consider all of the general contacts alleged to
support personal jurisdiction as set forth in the affidavit of Christy Heath, they would
still be insuffient to satisfy the Plaintiff’s burden.2 General personal jurisdiction
requires the defendant’s “continuous and systematic” contacts with the State of
Alabama. Helicopteros Nacionales de Colombia, 466 U.S. at 415. A one time gift
of money to a resident brother and retaining an attorney for a resident brother’s estate
1

Plaintiff concedes that this sentence of the affidavit is due to be stricken. (Doc. #23 at
4) (“However, only this sentence should be stricken – not the entire paragraph.”).
2

Because Zachary and Linda Heath would not be subject to personal jurisdiction in this
court even when the affidavit of Christy Heath is considered in full, the Motion (Doc. #20) to
Strike is MOOT.
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can certainly not be considered “continuous and systematic.” The mere fact that
Zachary belonged to hunting clubs in the State is also insufficient to support
jurisdiction – there is no allegation as to how often Zachary hunted in the State of
Alabama and no information whatsoever as to whether Zachary actually utilized such
memberships.
The court has no information that would support a finding that Zachary was
rendered “essentially at home” in Alabama or that he could have reasonably
anticipated that he might be sued in Alabama for matters unrelated to his (albeit
limited) general contacts. See Daimler AG v. Bauman, – U.S. –, 134 S. Ct. 746, 754
(2014); International Shoe, 326 U.S. at 316. To the contrary, the information before
this court is overwhelmingly that Zachary has had limited contacts with Alabama.3
As such, this court lacks general personal jurisdiction over defendant Zachary Heath.
2.

Linda Heath

Plaintiff makes the following assertions about Linda Heath’s general contacts
with Alabama: she spent approximately one weekend per month in Birmingham from
December 2001 until April 2011 to visit her grandchildren; she has spent a week at
a time in Alabama “on many occasions;” she spent at least five days visitng every

3

Zachary Heath has submitted an affidavit contesting the assertion of jurisdiction over
himself in Alabama. (See Doc. #12, Affidavit of Zachary Heath). He avers that: he has never
lived in Alabama; he does not have any interest in, or any property in, Alabama; he has never
been employed in Alabama or done business in Alabama; he has never contracted to buy, sell, or
provide services in Alabama; and he has never caused tortuous injury in Alabama.
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Thanksgiving and Christmas; she planned and attended Plaintiff’s wedding in
Birmingham (including contracting for venue and florist and sending out invitations);
she attended ALANON meetings in Birmingham and numerous church services; she
was present at the final divorce proceeding; she arranged a scholarship fund for Bryan
Heath with the Homewood Parks and Recreation Board; and she donated elementary
school library books to the Homewood school system in Bryan’s memory. (See Doc.
#17 at 16-18).
Once again, certain of these allegations set forth in Plaintiff’s affidavit are
subject to the Motion (Doc. #20) to Strike for lacking an underlying factual basis for
support. (See Doc. #20 at 2) (regarding paragraphs 17, 18). And once again, even
considering all of the allegations as set forth in the Affidavit (see footnote 2, supra),
Linda Heath’s contacts with the State of Alabama cannot be considered so
“continuous and systematic” as to render Linda “essentially at home in” Alabama.
See Daimler AG v. Bauman, – U.S. –, 134 S. Ct. 746, 754 (2014); International Shoe,
326 U.S. at 316. To the contrary, the information before this court is overwhelmingly
that Linda has had limited contacts with Alabama.4 That Linda has visited her
grandchildren in the State and helped plan a wedding in 2001 cannot, standing alone,

4

Linda Heath has submitted an affidavit contesting the assertion of jurisdiction over
herself in Alabama. (See Doc. #10, Affidavit of Linda Heath). She avers that: she has never
lived in Alabama; she does not have any interest in, or any property in, Alabama; she has never
been employed in Alabama or done business in Alabama; she has never contracted to buy, sell, or
provide services in Alabama; and she has never caused tortuous injury in Alabama.
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render it “fair play” and “substantial justice” to subject her to the personal jurisdiction
of this court. See International Shoe, 326 U.S. at 316. This court lacks general
personal jurisdiction over Linda Heath.
B.

Specific In Personam Jurisdiction

The exercise of specific jurisdiction is proper over a nonresident defendant
when he has "'purposefully directed' his activities at residents of the forum, and the
litigation results from alleged injuries that 'arise out of or relate to' those activities."
Burger King v. Rudzewicz, 471 U.S. 462, 473, 475 (1985) (internal citations omitted);
Consolidated Dev., 216 F.3d at 1291 ("Specific jurisdiction arises out of a party's
activities in the forum that are related to the cause of action in the complaint. It has
long been recognized that a court has the minimum contacts to support specific
jurisdiction only where the defendant 'purposefully avails itself of the privilege of
conducting activities within the forum State, thus invoking the benefits and
protections of its laws.'") (internal citations omitted). The requirement that there be
minimum contacts is grounded in fairness. It assures that "the defendant's conduct
and connection with the forum State [is] such that he should reasonably anticipate
being haled into court there." World-Wide Volkswagon Corp. v. Woodson, 444 U.S.
286, 297 (1980).
To show that a litigation "arises out of" the activities in the forum state, the
Eleventh Circuit does not use "mechanical or quantitative" tests, see Oldfield v.
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Pueblo De Bahia Lora, S.A., 558 F.3d 1210, 1222 (11th Cir. 2009); however, it is
"not enough that there be some similarity between the activities that connect the
defendant to the forum and the plaintiff's claim." Licciardello v. Lovelady, 544 F.3d
1280, 1285 n. 3 (11th Cir. 2008). The defendant's contacts with the forum must be
related to the "operative facts of the controversy." Id. Questions of specific
jurisdiction are examined in the context of the particular claims asserted – here, those
claims are grounded in intentional tort. To properly determine jurisdiction, "a court
properly focuses on 'the relationship among the defendant, the forum, and the
litigation.'" Calder v. Jones, 465 U.S. 783 (1984) (citing Shaffer v. Heitner, 433 U.S.
186, 204 (1977)).
Plaintiff argues that Linda and Zachary Heath are subject to the jurisdiction of
this court based on the allegations of conspiracy (Count Seven of the complaint)5
aimed at a resident of Alabama.

The conspiracy allegedly existed to breach a

contract and to breach a fiduciary duty.6 (See Doc. #17 at 9; see also Compl.). These

5

Count Seven alleges:
Defendants Linda Heath, Zachary Heath, Wayne Heath, Heath Financial, Inc.,
and Defendant Bryan Wayne Heath conspired with each other to violate the
agreement referenced herein regarding life insurance in order to deprive the
Plaintiff of the benefit of her bargain and to unjustly enrich themselves to
Plaintiff’s detriment.

6

Count Three alleges that a breach of fiducairy duty was committed by Defendants
Wayne Heath and Heath Financial, Inc. “taken in concert with the decedent and other
Defendants, including but not limited to, Linda Heath and Zachary Heath, and Principal Life
Inusrance Company, and that such actions constitute civil conspiracy. (Compl. ¶ 29).
12

claims are grounded in tort and require a showing of purpose, combination, and overt
acts to succeed. See e.g. Snyder v. Faget, 326 So.2d 113, 119 (Ala. 1976); Lawler
Mobile Homes, Inc. v. Tarver, 492 So.2d 297, 306 (Ala. 1986).
Indeed where an alleged conspirator acts to further a plan that contemplates
injury to a resident, personal jurisdiction may exist. See Shrout v. Thorsen, 470 So.2d
1222 (Ala. 1985). But here, the Plaintiff has failed to allege that either Linda or
Zachary acted for the purpose of causing harm to Plaintiff. (See Compl., ¶¶ 37, 38).
She has failed to refute the fact that Linda and Zachary had no knowledge of the
underlying insurance during the time of the alleged wrongful act. (Z. Heath Aff at
¶11; L. Heath Aff at ¶ 11). And she has failed to establish that Linda and Zachary
acted to breach the contract of husband and wife or to breach any fiduciary duty. In
fact, the only actual act in furtherance of a conspiracy that Plaintiff advances for
subjecting either Linda or Zachary to the specific personal jurisdiction of this court
is Zachary sending “Plaintiff an email telling her that her ex-husband’s life insurance
policy listed the children as beneficiaries, and concealing from her the existence of
additional beneficiaries.” (Doc. #17 at 14; see also Plaintiff Aff. at ¶ 7). Other than
that, the only concrete action of Linda and Zachary related to the action was to apply
for the insurance proceeds – and this was done in their home state of North Carolina.
(See L. Heath Aff at ¶ 12; Z. Heath Aff at ¶ 12).
This court lacks specific personal jurisdictionover Linda and Zachary Heath.
13

Neither defendant has purposefully directed any activity to the State of Alabama that
gave rise to this cause of action. See Consolidated Dev., 216 F.3d at 1291.
IV.

Conclusion
For the foregoing reasons, the Motions (Docs. #10, 12) to Dismiss of

Defendants Linda Heath and Zachary Heath are due to be granted. A separate order
will be entered dismissing all claims against Defendants Linda Heath and Zachary
Heath.
DONE this the 30th

day of July, 2014.

SENIOR UNITED STATES DISTRICT JUDGE

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