decided: June 24, 1975.
STEPNOWSKI ET UX., APPELLANTS,
AVERY ET UX.
Appeal from order of Court of Common Pleas of Montgomery County, No. 73-14823, in case of Raymond Stepnowski and Helmi Stepnowski, his wife v. Bernard A. Avery and Arlene C. Avery, husband and wife.
Frank L. Caiola, for appellants.
Leigh P. Narducci, with him McCarthy, King, Narducci & Signore, for appellees.
Watkins, P. J., Jacobs, Hoffman, Cercone, Price, Van der Voort, and Spaeth, JJ. Opinion by Jacobs, J.
[ 234 Pa. Super. Page 494]
This is an appeal from an order granting a petition to strike a default judgment. The seminal issue which is presented is whether the isolated sale of a personal residence by private individuals who thereafter become nonresidents is sufficient to meet the "doing business" requirement of the Pennsylvania long-arm statute;*fn1 and, if so, whether the exercise of extraterritorial in personam jurisdiction based upon such a sale is consistent with due process requirements.
On August 15, 1973, the appellants, Raymond and Helmi Stepnowski, purchased a house in Montgomery County, Pennsylvania, from the appellees who until the time of the transaction used it as their principal dwelling.
[ 234 Pa. Super. Page 495]
After selling their house, the appellees, Bernard and Arlene Avery, moved to Connecticut. The appellants allege that after entering into possession of the house they discovered certain latent defects in the roof and plumbing system which could not have been discovered by a reasonable inspection and which, they allege, had not been disclosed to them by the sellers.
The appellants notified the Averys of these defects and the cost of their repair by letter dated October 24, 1973. The Averys responded by letter denying responsibility and contending that not only were the alleged defects plainly visible but also they were discussed and considered in the negotiated purchase price.
The Stepnowskis filed a Complaint in Assumpsit on December 3, 1973, alleging money due because of the presence of the defects. A default judgment was entered on March 1, 1974, and was eventually stricken by the court on October 17, 1974, for want of proper jurisdiction.
As stated above the question presented is whether the appellees by selling their personal residence have subjected themselves to the jurisdiction of the courts of this Commonwealth by "doing business" in Pennsylvania.*fn2
[ 234 Pa. Super. Page 496]
It cannot be doubted that the recent legislative and judicial trend has been towards the liberalization of the "doing business" requirement and toward the adoption of the federal "minimum contacts" approach to the issue of extraterritorial jurisdiction. Bork v. Mills, 458 Pa. 228, 329 A.2d 247 (1974); Image Ten, Inc. v. Walter Reade Organization, Inc., 456 Pa. 485, 322 A.2d 109 (1974). This Court recently had occasion to construe the Pennsylvania statute as it applies to foreign corporations and noted that "[t]he evolution of the Pennsylvania 'long-arm' statute has now become coexistent with the evolution of substantive jurisdictional due process as expressed by the United States Supreme Court." Proctor & Schwartz, Inc. v. Cleveland Lumber Co., 228 Pa. Superior Ct. 12, 18, 323 A.2d 11, 14 (1974).
Even under the most liberal conception of minimum contacts, however, we cannot find acts sufficient to justify the exercise of in personam jurisdiction in the case at bar. "The emphasis of the statute is upon doing something in Pennsylvania for the purpose of making a profit." McAndrew v. Burnett, 374 F.Supp. 460, 462 (M.D.Pa. 1974). This Court, after an extensive review of the legislative history of the Pennsylvania long-arm statute and the interpretations which other jurisdictions have placed upon similar statutes, cannot accept the premise that our legislature's continued use of the touchstone "doing business" contemplated the incidental sale of a personal residence. The continued expansion of long-arm jurisdiction to "contacts which have their roots in the
[ 234 Pa. Super. Page 497]
market-place"*fn3 as opposed to those acts done within the state which are not actuated by a profit motive does not herald "the eventual demise of all restrictions on the personal jurisdiction of state courts." Hanson v. Denckla, 357 U.S. 235, 251 (1958). In our opinion the Pennsylvania statute did not intend to reach the occasional transaction conducted between private parties when such a transaction is not incidental to their business activities.*fn4 But see Van Wagenberg v. Van Wagenberg, 241 Md. 154, 215 A.2d 812, cert. denied, 385 U.S. 833 (1966) (extraterritorial jurisdiction derived from execution of marital separation agreement).
Due process requires that the exercise of jurisdiction be reasonable under the circumstances. International Shoe Co. v. Washington, 326 U.S. 310 (1945). What may
[ 234 Pa. Super. Page 498]
be "fair play" and "substantial justice" as to corporations may not always be such as to individuals, and cases involving corporations should be received cautiously as precedent for cases involving individual defendants. We find that the exercise of jurisdiction in this case would be unreasonable and offensive to traditional notions of fair play and substantial justice. See Proctor & Schwartz, Inc. v. Cleveland Lumber Co., supra.