The opinion of the court was delivered by: Mihm, District Judge.
Presently before the Court is the Defendant's Motion to
Dismiss the Complaint on the basis that this Court does not
have in personam jurisdiction over the Defendant. The Defendant
asserts that he is a citizen of the State of Missouri and was
not and is not subject to service of process for the relief set
forth in the Complaint. The Defendant argues that suit on the
guarantee is not the type of action which would provide a basis
for in personam jurisdiction as to this Defendant under the
Long Arm Statute of the State of Illinois, Ill.Rev.Stat., ch.
110, § 2-209 or the Due Process clause of the United States
Constitution.
This case arises out of a document denoted as a personal
guarantee purportedly signed by the Defendant. The date of
execution is shown to be May 12, 1978, three months subsequent
to the execution of two real estate mortgages by a
corporation, McLean Enterprises, Inc., on February 14, 1978.
The Complaint recites a mortgage foreclosure proceeding in
Knox County, Illinois, against the corporate signatory of the
mortgages, McLean Enterprises, Inc. (Case No. 87-CH-7). This
proceeding resulted in the sale of the real estate in question
for $1,100,000 on June 30, 1987.
The Plaintiffs, savings and loan associations, seek to
recover in this lawsuit the deficiency between the real estate
sale price and the sum allegedly personally guaranteed by the
Defendant, in the amount of $862,498.32. The basis of the
claim is a document entitled "Agreement as to Conveyance by
Mortgagor, Continued Guarantee by Mortgagor and Guarantee by
Mortgagor's Grantee." By its own terms, the document was
conditioned upon "the actual conveyance" of real estate to the
individual Defendant. While the Complaint alleges that the
Plaintiffs duly performed all their conditions of the
guarantee, there is no separate allegation that the property
was, in fact, actually conveyed by the corporation to the
individual Defendant.
A complaint was filed by the Plaintiff and against the
Defendant in Knox County, Illinois as 87-L-62 on September 4,
1987. Summons was served on the Defendant on September 14,
1987, in Greene County, Missouri. On October 14, 1987, a
Petition to Remove this action was filed with the United
States District Court for the Central District of Illinois on
the basis of diversity of citizenship. On October 14, 1987,
the Defendant filed his Motion to Dismiss under Rule 12(b) for
lack of personal jurisdiction over the Defendant.
Under 28 U.S.C. § 1441 et seq., removal jurisdiction is based
upon the federal court's original jurisdiction over diversity
suits. As a general rule, a cause is not removeable unless it
is properly before the state court. If a state court lacks
jurisdiction over one of the parties, the federal court cannot
acquire jurisdiction. People of the State of Illinois v.
Kerr-McGee Chemical Corp., 677 F.2d 571 (7th Cir. 1982).
"In situations where federal jurisdiction is
based upon diversity of citizenship, in personam
jurisdiction `is determined in accordance with
the law of the state where the court sits, with
federal law entering the picture only for the
purpose of deciding whether a state's assertion
of jurisdiction contravenes a constitutional
guarantee.' (Citation omitted)."
The Illinois Long Arm Statute (Ill.Rev. Stat., ch. 110,
§ 2-209) provides in relevant part:
"Acts submitting to jurisdiction — Process. (a)
Any person, whether or not a citizen or resident of
this state, who in person or through an agent does
any of the acts hereinafter enumerated, thereby
submits such person, and, if an individual, his or
her personal representative, to the jurisdiction of
the courts of this state as to any cause of action
arising from the doing of any of such acts:
(1) The transaction of any business within this
state;
(3) The ownership, use, or possession of any real
estate situated in the state;
(b) Service of process upon any person who is
subject to the jurisdiction of the courts of this
state, as provided in this section, may be made
by personally serving the summons upon the
defendant outside the state, as provided in this
Act, with the same force and effect as if those
summons had been personally served within the
state.
(c) Only causes of action arising from acts
enumerated herein may be asserted against a
defendant in an action in which jurisdiction over
him or her is based upon this section.
[Cook Associates, Inc. v. Lexington United Corp.,
87 Ill.2d 190, 197-198, 57 Ill.Dec. 730,
429 N.E.2d 847 (1981)-long long arm two elements § 2-209 and
due process]."
The Defendant's Motion to Dismiss asserts that this Court
has no in personam jurisdiction over the Defendant pursuant to
the Illinois Long Arm Statute. However, the Plaintiff asserts
jurisdiction pursuant to two prongs of the statute: (1)
transaction of business, and (2) ...