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Difference between revisions of "Gray v. American Radiator & Standard Sanitary Corp."

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(Created page with "''Gray v. American Radiator & Standard Sanitary Corp.'', 22 Ill. 2d 432, 176 N.E.2d 761 (Ill. 1961). '''FACTS:''' * Gray (P) suffered injuries when one of the water heaters...")
 
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Latest revision as of 05:46, 12 October 2019

Gray v. American Radiator & Standard Sanitary Corp., 22 Ill. 2d 432, 176 N.E.2d 761 (Ill. 1961).


FACTS:

  • Gray (P) suffered injuries when one of the water heaters she bought in IL, made with Titan Valves; (D) valves and manufactured by American Radiator (D) exploded
  • Titan Valve was an Ohio company and had no personnel within IL and conducted no business there
  • American Radiator was a PA company that used Titan valves in its water heaters which were manufactured in PA and sold in several different states, including IL
  • P brought a suit for negligence against American Radiator; American Radiator brought cross-claim against Titan → Titan served notice in OH under IL long-arm law authorizing service of process on all out-of-state actors who commit a tortious act within IL (§§ 16 & 17 of IL Civil Practice Act)
    • Titan moved to dismiss alleging it did not commit a tortious act within IL and was out of jurisdiction


PROCEDURAL HISTORY:

  • Appeal from granting of motion to quash service of summons in action for damages for negligence
    • Cir. Ct. of Cook County dismissed action for damages; granting Titan’s motion


ISSUE(S):

  1. Can a state exercise jurisdiction over a corporation which does no business within the state, provided that the act giving rise to the litigation has a substantial connection to the state?
    1. Constitutional question in the state of IL → automatically moved to Supreme Court of IL


HOLDING: Yes.


ANALYSIS:

  1. IL can exercise jurisdiction over Titan whose only contact with the state was the sale, outside of the state, to a manufacturer who sold a product within IL, b/c the last act that occurred is what is necessary to render an actor liable, and that last wrong act occurred in IL
    1. Conflict of Laws §377
    2. Application of IL long-arm law does not violate due process → International Shoe Rule
      1. Substantial connection to the state
    3. If product was brought to IL against Titan’s will, this would be a different case
    4. Titan benefitted from the laws of IL, even if indirectly, and therefore does not preclude the ultimate consumers from obtaining justice for Titan’s wrongdoing
    5. Citation to Nelson v. Miller – single tortious act was enough to sustain jurisdiction under the present statute
    6. No formula, must ascertain what is fair and reasonable; matter of public policy to hold manufacturer accountable for injuries caused by its product (“related to” and “arise from” conduct within the state)
    7. Courts of the forum in which the injury occurred are also most fit to conduct trial – more convenient


FINAL DEPOSITION: Reversed and remanded


BLACK LETTER:

  • The International Shoe minimum contacts requirement is satisfied even when a corporation conducts no business within a state, so long as the act giving rise to the lawsuit has a “substantial connection” to the state* Supreme Court of IL declares that IL courts have jurisdiction over corporations which conduct no business whatsoever in IL
  • Constitutional to assert personal jurisdiction over a company for putting any dangerous product into the “stream of commerce”
  • Sufficient contacts existed to exercise jurisdiction over a foreign corporation because it elected to sell its products for ultimate use in other states and it was unjust not to hold it answerable for the damage caused by its products


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