QSR, Inc. v. Concord Food Festival, Inc., 766 So. 2d 271 (2000)

Facts

  • Concord Food Festival, Inc. (Concord), a New Hampshire corporation, entered into a 20-year franchise agreement with Miami Subs USA (MSUSA), a Florida corporation, to operate a Miami Subs restaurant in Connecticut.

  • To operate the franchise, Concord subleased Connecticut property from QSR, Inc. (QSR), a Florida corporation that leased or rented premises for Miami Subs franchisees.

  • MSUSA and QSR were wholly owned subsidiaries of Miami Subs Corporation, a Florida parent company.

  • The franchise agreement contained Florida choice-of-law and venue provisions, but the sublease between QSR and Concord did not include a forum-selection clause.

  • QSR sued Concord in Florida circuit court for breach of the sublease, alleging Concord abandoned the Connecticut premises and asserting specific personal jurisdiction under Florida’s long-arm statute (breach-of-contract provision).

  • Concord moved to dismiss for lack of personal jurisdiction. Concord conceded the complaint satisfied Florida’s long-arm statute, but argued due process was not met because:

    • the sublease was executed in New Hampshire, and
    • executing the sublease was Concord’s only Florida-related contact.

  • Concord supported its motion with an affidavit stating it had no offices, agents, property, or general business operations in Florida and that the sublease was negotiated and executed outside Florida.

  • QSR filed a responsive affidavit stating:

    • the sublease was entered into in Florida,
    • Concord had ongoing Florida contacts by regularly communicating with QSR in Florida and sending sublease payments to Florida, and
    • Concord had additional Florida contacts through its franchise relationship with MSUSA and related dealings tied to Florida-based corporate personnel.

  • Without resolving the conflicts between the affidavits, the trial court dismissed the case for lack of personal jurisdiction. QSR appealed.

Issues

  1. When the parties submit conflicting affidavits on material jurisdictional facts bearing on minimum contacts, may a Florida trial court dismiss for lack of personal jurisdiction without first holding a limited evidentiary hearing to resolve the conflicts?
  2. In assessing minimum contacts for a sublease dispute, may the defendant’s related franchise agreement and course of dealing with Florida-based affiliated entities be relevant to the due process analysis?

Decision

  • The Fourth District Court of Appeal reversed the order dismissing QSR’s complaint and remanded.
  • The court held that the competing affidavits conflicted on material facts about Concord’s Florida contacts (including where the sublease was entered into and the extent of ongoing Florida-directed communications and payments).
  • Because those disputed facts were essential to the minimum-contacts determination, the trial court was required to conduct a limited evidentiary hearing (or other fact-finding) before ruling on personal jurisdiction.
  • The appellate court did not decide whether Florida ultimately had personal jurisdiction over Concord; it required the trial court to resolve the factual disputes and then apply the due process analysis.

Legal Principles

  • Florida personal jurisdiction involves a two-step inquiry: (1) whether the complaint alleges facts bringing the case within Florida’s long-arm statute; and (2) whether the defendant has sufficient minimum contacts with Florida to satisfy due process.
  • Once the long-arm statute is satisfied, the defendant may contest jurisdiction by affidavit; the plaintiff must then rebut by affidavit or other sworn proof.
  • If the affidavits do not conflict on essential jurisdictional facts, the trial court may decide jurisdiction on the written submissions.
  • If the affidavits conflict on essential jurisdictional facts, the trial court must hold a limited evidentiary hearing to resolve the disputed facts before granting a motion to dismiss for lack of personal jurisdiction.
  • Minimum contacts depend on the nature and quality of the defendant’s Florida-directed conduct and whether the defendant purposefully established contacts such that being sued in Florida was reasonably foreseeable; physical presence is not required.
  • When contracts and the parties’ ongoing relationship are connected, a court may consider the broader course of dealing and related agreements when evaluating whether Florida-directed activity satisfies due process.

Conclusion

QSR, Inc. v. Concord Food Festival, Inc. holds that a trial court cannot dismiss for lack of personal jurisdiction based solely on competing affidavits that conflict on material minimum-contacts facts; instead, the court must conduct a limited evidentiary hearing to resolve those disputes and then determine whether due process permits jurisdiction.