Special Appearance to Challenge Personal Jurisdiction and the Traps This Creates for Unwary Practitioners." the Members You Appointed to This Subcommittee Were

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CREAGER LAW FIRM, PLLC

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August 31, 2010

B!~ E-Mail Roger W. Mullins, Esquire Roger W. Mullins, PLLC P.O. Box 647 Tazewell, VA 24651 Email: [email protected]

Re: Boyd Graves Special Appearance Subcommittee

Dear Roger:

By e-mail dated May 13, 2010, you asked me to Chair a subcommittee to study "whether to abolish the rule requiring a special appearance to challenge personal jurisdiction and the traps this creates for unwary practitioners." The members you appointed to this subcommittee were:

The Hon. Dennis J. Smith Stuart A. Raphael Joseph C. Kearfott Sandra M. Rohrstaff D. Alan Rudlin Roger T. Creager, Chairman

Our subcommittee members unanimously decided to recommend enactment of a new statute which is set forth just below. This proposed new statute clarifies (and perhaps revises) some of the current law on this issue and thus, it is hoped, will serve to eliminate some of the "traps for unwary practitioners." Our proposed statute clarifies what types of litigation conduct do and do not waive an objection to personal jurisdiction or defective process, and provides as follows:

[Proposed New Statute]

§ 8.01-277.1. Objections to personal jurisdiction or defective process; what constitutes waiver.

B. A person does not waive any objection to personal jurisdiction or defective process if the person engages in conduct unrelated to adjudicating the merits of the case, including: 1. Requesting or agreeing to an extension of time; 2. Agreeing to a scheduling order; 3. Conducting discovery authorized by the court related to adjudicating the objection; 4. Observing or attending proceedings in the case; 5. Filing a motion to transfer venue pursuant to § 8.01-264 when such motion is filed contemporaneously with the objection; or 6. Removing the case to federal court.

C. The fact that a person fails to state that the appearance is a special appearance does not constitute a waiver of any objection to personal jurisdiction or defective process, provided the person’s conduct is consistent with seeking to adjudicate the objection.

Since the proposed statute refers to existing Virginia Code Section 8.01-277, the Conference members will want to have that existing statute in front of them for convenient reference and so I am providing it here now.

Existing Virginia Code Section 8.01-277 [which would remain unchanged] provides:

§ 8.01-277. Defective process; motion to quash; untimely service; motion to dismiss

A. A person, upon whom process to answer any action has been served, may take advantage of any defect in the issuance, service or return thereof by a motion to quash filed prior to or simultaneously with the filing of any pleading to the merits. Upon sustaining the motion, the court may strike the proof of service or permit amendment of the process or its return as may seem just.

B. A person, upon whom process has not been served within one year of commencement of the action against him, may make a special appearance, which does not constitute a general appearance, to file a motion to dismiss. Upon finding that the plaintiff did not exercise due diligence to have timely service and sustaining the motion to dismiss, the court shall dismiss the action with prejudice. Upon finding that the plaintiff did exercise due diligence to have timely service and denying the motion to dismiss, the court shall require the person filing such motion to file a responsive pleading within 21 days of such ruling. Nothing herein shall prevent the plaintiff from filing a nonsuit under § 8.01-380 before the entry of an order granting a motion to dismiss pursuant to the provisions of this section. Nothing in this subsection shall pertain to cases involving asbestos. Letter to Roger W. Mullins, Esq. August 31, 2010 Page 3 of 3

By copy of this letter, I am thanking the outstanding members of this subcommittee for their fine work on this topic. I want in particular to thank Stuart A. Raphael for the outstandin~ Committee Report to the Conference which he researched and wrote, a copy of which is provided as Attachment A to this letter. Stuart’s report and the in-depth research it includes is an excellent example of why we all find our Conference books to be a valuable research source long after each year’s Conference.

Please note that for the convenience of the Conference in discussing our proposed new statute a draft copy of the new statute (Section 8.01-277.1) which is unanimously recommended to the Conference by our Committee is attached as Attachment 1 in "bill" format so that it contains numbered lines. This should facilitate discussion of any particular provisions of the statute since Conference members will be able to refer to particular language by the line numbers assigned in the left margin.

Roger, as always I look forward to seeing you and the other Conference members at our annual meeting in Williamsburg on October 22-23, 2010. Please let me know if I can be of any further assistance.

Sincerely yours,

/s/

Roger T. Creager

Cc: Committee Members (listed above) (by e-mail) Attachment A

MEMORANDUM

TO: Boyd-Graves Conference

FROM: Committee to Study Special Appearance Rule [Committee.Report Researched and Written by Smart A. Raphael]

DATE: August 16, 2010

Our committee was asked to study "whether to abolish the rule requiring a special appearance to challenge personal jurisdiction and the traps this creates for unwary practitioners."

We concluded that, while the special appearance rule should not be entirely abrogated, it should be modified by statute to eliminate several traps for practitioners. We propose a new statute- Code § 8.01-277.1 (Attachment 1)- to clarify what actions constitute a general appearance and what actions do not waive a party’s objection to personal jurisdiction or defective process.

I. Virginia’s "Special Appearance" Rule. A "special appearance" is a defensive "pleading that either claims that the court lacks personal jurisdiction over the defendant or objects to improper service of process." Black’s Law Dictionary 114 (9th ed. 2009). It can also refer to a "defendant’s showing up in court for the sole purpose of contesting the court’s assertion of personal jurisdiction over the defendant." Id.

Virginia courts construe the rule strictly and apply it quite rigidly. As the Supreme Court put it in Gilpin v. Joyce, 257 Va. 579, 515 S.E.2d 124 (1999):

"An appearance for any other purpose than questioning the jurisdiction of the court - because there was no service of process, or the process was defective, or the action was commenced in the wrong county, or the like - is general and not special, although accompanied by the claim that the appearance is only special." Norfolk and Ocean View Railway Co. v. Consolidated Turnpike Co., 111 Va. 131, 136, 68 S.E. 346, 348 (1910) .... A general appearance "is a waiver of process, equivalent to personal service of process, and confers jurisdiction of the person on the court." Nixon v. Rowland, 192 Va. 47, 50, 63 S.E.2d 757, 759 (1951).

Id. at 581,515 S.E.2d at 125 (emphasis altered).

"Virginia steadfastly adheres to the traditional general and special appearance doctrine.’’I As one circuit court has observed, "practically any activity that is not a direct challenge to the

I Xyrous Commc ’ns, LLC v. Bulgarian Telecomm. Co., No. 1:09-cv-396, 2009 WL 2877084 (E.D. Va. Sept. 4, 2009). jurisdiction of the court is a general appearance.’’2

Some actions that constitute a general appearance are obvious; others are less so. The less obvious ones create procedural traps for practitioners.

A. Actions that Obviously Constitute a General Appearance.

Actions that fairly obviously constitute a general appearance include:

¯ filing a pleading that goes to the merits of the case, including a demurrer or answer3, or even answering a co-defendant’s cross-claim4;

¯ entering a general appearance without objecting to jurisdiction;5 and

¯ conducting general discovery.6

2 Gilmore v. Wise Co., 72 Va. Cir. 353,354 (Portsmouth, 2006). 3 E.g., Lyren v. Ohr, 271 Va. 155,623 S.E.2d 883 (2006) (holding that defendant who filed an answer and grounds of defense, in reliance on plaintiff’s representation that service was timely, nonetheless waived his objection to untimely service); Kiser v. Amalgamated Clothing Workers, 169 Va. 574, 591,194 S.E. 727, 734 (1938) ("Of course pleading the general issue, demurring, or filing an affidavit of substantial defense amount to a general appearance.") (quoting Burks’ Pleading and Practice (3d Ed.), sec. 51, p. 107); Norfolk & Ocean View Ry. v. Consolidated Turnpike Co., 111 Va. 131,136-37, 68 S.E. 346, 348 (1910) ("When the plaintiff in error appeared and moved the court to vacate the proceedings had in the cause and to dismiss it, it did so upon grounds which went to the sufficiency of the petition of the receivers. A motion to vacate proceedings in a cause, or to dismiss or discontinue it, because the plaintiff’s pleading does not state a cause of action, is equivalent or analogous to a demurrer and amounts to a general appearance."). 4 Gilmore v. Wise Co., 72 Va. Cir. 353,354 (Portsmouth 2006) (holding that when the defendant responded to the co-defendant’s cross-claim, it waived its personal jurisdiction objection to the plaintiff’s claim). s MarylandCas. Co. vo ClintwoodBank, Inc., 155 Va. 181,186, 154 S.E. 492,494 (1930) ("Service of a notice of general retainer or appearance, or filing such notice with the clerk after a complaint has been filed, constitutes a general appearance in actions at law.") (quoting 3 Cyc. 504); but see 4 Am. Jur., Appearance, § 2 (2010) ("filing a notice of appearance by counsel does not constitute a waiver of personal jurisdiction.") (citing Mason v. Hunton, 816 So. 2d 234 (Fla. Dist. Ct. App. 2002)). 6 Marsinko v. Burwell, No. CL07001070-00, 2008 Va. Cir. LEXIS 125 (Roanoke County Oct. 1, 2008) (holding that defendant’s issuance of subpoena duces tecum, before filing its motion to dismiss for lack of personal jurisdiction, was a general appearance that waived the objection); Doles v. Doles, 51 Va. Cir. 403,405 (Loudoun 2000) (same). B. Actions that, Less Obviously, Can Constitute a General Appearance. Less obvious actions that Virginia courts have said constitute a general appearance include: ¯ seeking or agreeing to a continuance or extension of time;v ¯ opposing the plaintiff’s motion to consolidate two cases;s

¯ initiating discovery, even if it is limited to the ]uestion of personal jurisdiction, and even if it purports to be by special appearance; ¯ sending a letter to the trial court requesting a stay;1° ¯ removing the case to federal court;ix

7 See New River Mineral Co. v Painter, 100 Va. 507, 509, 42 S.E. 300, 301 (1902) ("Before the defendant made its motion to quash, it had appeared and consented to a continuance of the case. Objections which do not go to the substance of an action are treated as waived if not made when the occasion for them arises. It is a well-established rule of practice that by appearing to the action the defendant waives all defects in the process and in the service thereof. The decisions go further and imply such a waiver from the defendant’s taking or consenting to a continuance as fully as they do from his pleading to the action. The object of the writ is to apprise the defendant of the nature of the proceeding against him. His taking or agreeing to a continuance is evidence of his having made himself a party to the record, and of his having recognized the case as in court. It is too late for him afterwards to say that he has not been regularly brought into court."); Kiser v. Amalgamated Clothing Workers, 169 Va. 574, 591,194 S.E. 727, 734 (1938) ("granting or accepting a continuance, or a motion to quash for other reasons than defects in the process or return, amount to a general appearance.") (quoting Burks’ Pleading and Practice (3d Ed.), sec. 51, p. 107); New Life Christian Church v. Dynabilt Tech. Int ’l Corp., 59 Va. Cir. 399, 402 (Norfolk 2002) ("Defendant made a general appearance when it appeared, by counsel, to request an extension of time for filing responsive pleadings."); Herrington Corp. v. ICON Int’l, Inc., 31 Va. Cir. 253 (Fairfax 1993) (same); but see Frank Mgmt. Inc. v. Joel, 19 Va. Cir. 267, 269 n.1 (Richmond 1990) ("The court finds no merit in plaintiff’s contention that Joel made a general appearance, thus consenting to this court’s jurisdiction, when he moved the court for an extension of time in which to answer, respond, or otherwise plead."). 8 Dolan v. Dyer, 61 Va. Cir. 650, 651 (Alexandria 2002) ("by appearing before this court and arguing against the motion to consolidate, the defendants have entered a general appearance and have waived objection to personal jurisdiction"). 9 Emeritus Commc ’ns, Inc. v. Benedictine College, 58 Va. Cir. 61, 61 (Fairfax 2001) ("Defendant argued that the discovery was sought under its special appearance, strictly for the purpose of determining the jurisdictional issue .... [A]lthough Defendant asserted a special appearance, the discovery request constituted a general appearance in this case."). lo Jones v. Caldwell, 61 Va. Cir. 408, 412-15 (Winchester 2003). * removing the case to the circuit court from the general district court;12

¯ opposing a motion for a temporary injunction by contesting the merits;~3

¯ objecting to personal jurisdiction by demurrer, rather than by motion to quash or to dismiss;~4 and

¯ moving to set aside a default judgment for fraud on the courtJ5

C. Virginia’s Partial Modification of the Special Appearance Rule.

Virginia has partially modified the "special appearance" rule in two places.

First, Code § 8.01-286.1, recommended by the Boyd-Graves Conference, was added in 2005.~6 This statute, modeled on Fed. R. Civ. P. 4, enables a party to waive formal service of process without waiving an objection to personal jurisdiction. This spares the plaintiff the cost of service and provides additional time for the defendant to respond (60 days after the waiver request, or 90 days if the defendant’s address is outside of Virginia). A defendant who fails to waive service of process is liable for the service costs, unless good cause is shown for the failure.

11 Salomonsky v. BrandaidMktg. Corp., 66 Va. Cir. 24, 24-25 (Richmond 2004) (holding that defendant’s removal to federal court was a general appearance that, upon remand, waived its objection to personal jurisdiction, even though the defendant moved to dismiss for lack of personal jurisdiction before the unsuccessful removal); Agbey v. Sati, 69 Va. Cir. 330, 333 (Fairfax 2005) ("Defendants’ action in removing this case to federal court was a general appearance and has waived any claim for lack of personal jurisdiction."). 12 Cross ~. Whitehurst, 29 Va. Cir. 306 (Loudoun County 1992) ("By removing the present case from General District Court to Circuit Court, rather than defending the case on the merits and seeking a de novo appeal of all the issues, including service of process, the Defendant took an affirmative action submitting him to the general jurisdiction of the Court."). 13 Dials v. v. Lee’s Hill P ’ship, 41 Va. Cir. 214 (Spotsylvania 1996) ("Although the defendant noted in open court and in its memorandum that it was making a ’special appearance’ in opposition to the motion for temporary injunction, its opposition was not based on lack of service.., or on any other jurisdictional ground. Instead, the defendant proceeded to defend the request for a temporary injunction on the merits."). 14 Herrington Corp. v. ICONInt’l, Inc., 31 Va. Cir. 253 (Fairfax 1993) ("A demurrer is not the proper mechanism to raise the issue of lack of personal jurisdiction in this caseBy .... filing a demurrer, the Defendants have admitted factual allegations that the Defendants are doing business in Virginia and/or are deriving substantial revenue from doing business in Virginia."); but see Mueller v. Dyncorp, 20 Va. Cir. 47, 48 n.2 (1989) ("personal jurisdiction is a question of law, not a fact which Kellogg admitted by demurring"). ~5 Xyrous Commc ’ns, LLC v. Bulgarian Telecomm. Co., No. 1:09-cv-396, 2009 WL 2877084 (E.D. Va. Sept. 4, 2009). ~6 2005 Va. Acts ch. 866 (SB 1123). Code § 8.01-287(B). Subsection F protects a defendant who wishes to object to personal jurisdiction: "A defendant who waives service of process pursuant to this section does not thereby waive any objection to venue or to the jurisdiction of the court over the person of that defendant, or to any other defenses or objection other than objections based on inadequacy of process or service of process." Code § 8.01-287(F).

Virginia also modified the special appearance doctrine in Code § 8.01-277, which "changes the common law.’’17 Subsection A allows a party to object to defective process simultaneously with pleading to the merits of the case. Subsection B specifies how a defendant who has not been served within one year may enter a special appearance to seek dismissal of the action with prejudice. The statute provides:

§ 8.01-277. Defective process; motion to quash; untimely service; motion to dismiss.

Subsection A allows a defendant to challenge defects in process "prior to or simultaneously with the filing of any pleading to the merits." (Emphasis added.) So the objection to process is not waived by joining it with a pleading going to the merits.

Subsection B was added in 2006. 2006 Va. Acts ch. 151. It deals with the situation that arose in Gilpin v. Joyce, 257 Va. 579, 515 S.E.2d 124 (1999), where the defendant wanted to take advantage of Rule 3:3 - now Rule 3:5(e) - which prevents the entry of judgment against a defendant who has not been served with process within one year, unless the court finds that the

17 W. Hamilton Bryson, Bryson on Virginia Civil Procedure § 3.0312] at 3-29. plaintiff exercised due diligence to effectuate service. The defendant in Gilpin had not been served with process. After more than a year elapsed, he filed a grounds of defense, a counterclaim, and a motion to dismiss for failure to serve process within the year. The Supreme Court ruled that his general appearance waived his objection to the untimely service of process. The Court further ruled that his motion to dismiss for untimely service was not saved by Code § 8.01-277 (as then written), because it permitted a defendant to object to defects in process only if the defendant was one "upon whom process to answer any action has been served." 257 Va. at 582, 515 S.E.2d at 126 (quoting Code § 8.01-277). Since the defendant had not been served, he could not take advantage of this statute. The Court strictly construed this statute because it was "in derogation of the common law." Id. The 2006 amendment added Subsection B to allow an unserved defendant in this situation to raise the one-year objection by "special appearance," except in cases involving asbestos. The plaintiff, however, may take a nonsuit before the court dismisses the case with prejudice. Note that the law is presently unclear whether Code § 8.01-277(A) permits a defendant who has been served with process to file an objection to personal jurisdiction "simultaneously" with a pleading that addresses the merits. Professor Bryson says it does: "In modem Virginia practice [citing Code § 8.01-277], if the objection to jurisdiction is made prior to or simultaneously with a pleading to the merits, the objection is not waived but will be considered by the judge first.’’~8 But at least one circuit court has disagreed with Prof. Bryson, despite "considerable pause." City of Portsmouth v. Buro Happoid Consulting Eng’rs, 69 Va. Cir. 397, 399 (Portsmouth, 2005). That court ruled that Code § 8.01-277 does not apply to challenges to lack of personal jurisdiction but applies "only when a challenge is made to a technical defect in the service." Id. The court said its disagreement with Prof. Bryson was "reinforced by the last sentence of the statute, which provides that the court may ’ strike the proof of service or permit amendment of the process or its return as may seem just.’ Admittedly this is a strict construction of the statute, but such is the direction of Gilpin.,, -- 19 let.

The uncertainty whether Code § 8.01-277 applies to personal jurisdiction objections will prompt most lawyers to be cautious; they will file a motion to dismiss for lack of personal jurisdiction alone, by special appearance, and unaccompanied by any pleadings going to the merits. II. Other Jurisdictions.

Virginia is one of few jurisdictions that retains the common law distinction between a "general appearance" and "special appearance."

1~ Bryson, supra, at 3-29 & n.191. 19 Another circuit court, without addressing Code § 8.01-277, ruled that a defendant entered a general appearance when it simultaneously filed a motion craving oyer and motion to quash for lack of personal jurisdiction. BBS Holdings, Inc. v. Dennis Anderson Construction Corp., No. 177877, 1999 Va. Cir. LEXIS 723 (Fairfax Oct. 21, 1999). The Federal Rules abolished the distinction in 1938. In federal court, a party raises an objection to process or to personal jurisdiction by motion under Rule 12(b)(2), (4), or (5). The objection is waived unless raised with other Rule 12(b) motions or in the answer, if no motion under Rule 12 is made. Fed. R. Civ. P. 12(h). In 1944, the Third Circuit used colorful language to describe the ancient doctrine’s abandonment:

Rule 12 has abolished for the federal courts the age-old distinction between general and special appearances. A defendant . . . is no longer required at the door of the federal courthouse to intone that ancient abracadabra of the law, de bene esse, in order by its magic power to enable himself to remain outside even while he steps within. He may now enter openly in full confidence that he will not thereby be giving up any keys to the courthouse door which he possessed before he came in. This, of course, is not to say that such keys must not be used promptly. If the defense of lack of jurisdiction of the person is not raised by motion before answer or in the answer itself it is by the express terms of paragraph (h) of Civil Procedure Rule 12 to be treated as waived, not because of the defendant’s voluntary appearance but because of his failure to assert the defense within the time prescribed by the rules.

Orange Theatre Corp. v. Rayherstz Amusement Corp., 139 F.2d 871,874 (3rd Cir. 1944).

In addition, most States appear to have abandoned the distinction, although our committee did not conduct a 50-State survey.2°

III. Our Proposed Reform. The Committee did not support abandoning the special appearance rule altogether. Some members felt that it made good sense to require a defendant to raise any objection to personal jurisdiction or defective process before addressing anything going to the merits of the controversy. One member preferred the federal approach but thought, nonetheless, that there would be insufficient support in Virginia for such large-scale change. The Committee unanimously agreed, however, that the rule as applied in Virginia sl~ould be further relaxed to eliminate its remaining "gotcha" aspects and to clarify which actions constitute a general appearance and which do not. We recommend a new statute, Code § 8.01-277.1, included both in Attachment 1 and shown below. We are grateful to David Cotter, of the Division of Legislative Services, for his

20 See 4 Am. Jur. 2d, Appearance, § 4 (2010) (noting that "some states" retain the "special appearance" distinction, but citing cases only from California, Florida, Illinois and Nebraska). time reviewing our proposal and his many helpful suggestions that have been incorporated into it. § 8.01-277.1. Objections to personal jurisdiction or defective process; what constitutes waiver.

A. Except as provided in § 8.01-277, a person waives any objection to personal jurisdiction or defective process if the person engages in conduct related to adjudicating the merits of the case, including: 1. Filing a demurrer, plea in bar, answer, counterclaim, cross-claim, or third-part~ claim; 2. Conducting discovery, except as provided in subsection B; 3. Seeking a ruling on the merits of the case; or 4. Actively participating in proceedings related to determining the merits of the case. B. A person does not waive any objection to personal jurisdiction or defective process if the person engages in conduct unrelated to adjudicating the merits of the case, including: 1. Requesting or agreeing to an extension of time; 2. Agreeing to a scheduling order; 3. Conducting discovery authorized by the court related to adjudicating the objection; 4. Observing or attending proceedings in the case; 5. Filing a motion to transfer venue pursuant to § 8.01-264 when such motion is filed contemporaneously with the objection; or 6. Removing the case to federal court. C. The fact that a person fails to state that the appearance is a special appearance does not constitute a waiver of any objection to personal jurisdiction or defective process, provided the person’s conduct is consistent with seeking to adjudicate the objection.

The qualifier "[e]xcept as provided in § 8.01-277" - at the beginning of Subsection A - makes this new statute consistent with that Code section. Without this qualifier, a party could not file an objection to defective process "simultaneously" with a pleading on the merits, something that is expressly allowed by Code § 8.01-277.21

Subsections A and B define the opposite poles on the spectrum of conduct that may constitute a general appearance that waives objections to personal jurisdiction and defective process. The general test is whether the person has engaged in conduct related "to adjudicating the merits of the case."

21 The Committee discussed whether Code § 8.01-277 should be amended to clarify whether it applies to objections to personal jurisdiction. There was no majority to do that. The Committee agreed that fixing the "gotcha" aspects of the special appearance rule by adding Code § 8.01-277.1 was more important than amending Code § 8.01-277 to enable a party to file an objection to personal jurisdiction simultaneously with pleadings going to the merits. Subsection A identifies clear examples of such conduct, such as filing a pleading on the merits, conducting discovery, seeking a merits ruling, or actively participating in a proceeding to determine the merits.

Subsection B, by contrast, identifies examples of conduct unrelated to adjudicating the merits of the case that should not waive an objection to personal jurisdiction or defective process. The most serious "gotchas" in the current law are corrected: requesting or agreeing to an extension of time; agreeing to a scheduling order; engaging in limited jurisdictional discovery if authorized by the court; observing or attending proceedings in the case; and removing the case to federal court.

The Committee added motions to transfer venue in subsection (B)(5) as an example of a non-merits based action that should not waive an objection to personal jurisdiction or defective process. A motion to transfer venue must be made within 21 days of service, or within the period of any extension of time fixed by the court. Code § 8.01-264(A). While the Committee was unaware of any Virginia case in which a motion to transfer venue was filed simultaneouslY with an objection to personal jurisdiction, a Virginia court applying the special appearance rule strictly could find that doing both constitutes a general appearance, even if styled as "special." The Restatement offers that scenario as an example of an event that triggers a general appearance.22 The Committee believed that a party should not have to abandon an objection to venue as the price of preserving an objection to personal jurisdiction.

The examples in Subsections A and B are not exhaustive. That is made clear by using the word "including" before each list. See Code § 1-218 ("’Includes’ means including, but not limited to.") The touchstone is whether the party’s conduct relates "to adjudicating the merits of the case." Courts can deal with scenarios not covered by the examples by applying this general principle as illuminated by the examples listed.

Subsection C eliminates the "gotcha" situation that arises when a defendant’s initial appearance is consistent with seeking to object to personal jurisdiction or defective process but the defendant fails to denominate the appearance as "special." This may occur, for example, when a defendant seeks an extension of time to respond to the initial pleading. The defendant’s failure to invoke the mantra that the appearance is "special" should not by itself waive an objection to personal jurisdiction or defective process. Of course, if the defendant undertakes other conduct related to adjudicating the merits of the case, then a waiver of the objection would occur under Subsection A.

22 Restatement (Second) of Judgments § 10 illust. 1 (1982) ("P brings suit in State X against D, a resident of State Y. Under the procedure of State X, the proper procedure for contesting the validity of process is by special appearance. D makes an appearance "for the sole purpose of challenging jurisdiction" and asserts that "minimum contacts" were lacking between him and State X, and also that the action properly should have been brought in another court in State X. D has made a general appearance and thereby lost his objection to territorial jurisdiction."). Our committee unanimously recommends this proposal to the Conference.

Respectfully submitted,

The Hon. Dennis J. Smith Joseph C. Kearfott Stuart A. Raphael Sandra M. Rhorstaff D. Alan Rudlin Roger T. Creager, Chairman

Committee Report by Stuart A. Raphael

10 Attachment 1

SENATE BILL NO. HOUSE BILL NO.

1 A BILL to amend the Code of Virginia by adding a section numbered 8.01-277.1, relating to personal 2 jurisdiction; special appearance.

3 Be it enacted by the General Assembly of Virginia: .... 4 1. That the Code of Virginia is amended by adding a section numb~i’edS.01-277.1 as follows: 5 § 8.01-277.1. Objections to personal jurisdiction or defec.ti’~:.proces~i~:~hat constitutes waiver. 6 A. Except as provided in § 8.01-277, a person w..~jveS a~ objection to’~~!?al jurisdiction or 7 defective process if the person engages in condu~t~!g~gd to ~aj~dicating the ~’~~::~d~ the case, 8 including: 9 1. Filing a demu~er, plea in bar, answer, counterclaim, ~0g~:claim, or third-pa~ claim; 10 2. Conducting discover, except as prd~ided ~ subsection B; 11 3. Seeking a ruling on the merits of the case; or~::::~:;. ~:~::- ...... :~ ..... 12 4. Actively pa~icipating in proceedings related to dete~:~h~ the merits of the case. 13 B. A person does not waive .any objection m personal jurisdiction or defective process if the 14 person engages in conduct ~elated re.adjudicating the Nerits of the case, including: 15 1. Requesting 0r agreeing toan ei~niion6ffime; 16 2.’Agreeing to a ~ch~duling 17 32 C0nducting discover. :authorizedby the cou~ related to adjudicating the oNection; 18 4. ob?~: ~..,..,.~g or attendi6g~ proceedings in the case; 19 5. Filing a ~otion to..transfer venue pursuant to ~ 8.01-264 when such motion is filed 20 contemporaneously with:the0bjection; or 21 6. Removing th~"case to federal court. 22 C. The fact that a person fails to state that the appearance is a special appearance does not 23 constitute a waiver of any objection to personal jurisdiction or defective process, provided the person’s 24 conduct is consistent with seeking to adjudicate the objection. [End].

99900.07754 EMF US 31876305v2