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PNC Multifamily Capital Institutional Fund XXXIV Ltd. Partnership v. AOH-Regent Ltd. Partnership

Court of Appeals of Oregon

April 30, 2014

PNC MULTIFAMILY CAPITAL INSTITUTIONAL FUND XXXIV LIMITED PARTNERSHIP; PNC MULTIFAMILY CAPITAL INSTITUTIONAL FUND XXIX LIMITED PARTNERSHIP; and COLUMBIA HOUSING SLP CORPORATION, Plaintiffs-Appellants,
v.
AOH-REGENT LIMITED PARTNERSHIP; AOH-REGENT GP, INC.; AMERICAN OPPORTUNITY FOR HOUSING-JAMES PARK LIMITED PARTNERSHIP; JAMES PARK CORPORATION; AMERICAN OPPORTUNITY FOR HOUSING-GREENVIEW MANOR LIMITED PARTNERSHIP; AOH-GREENVIEW MANOR, GP, INC.; and AMERICAN OPPORTUNITY FOR HOUSING, INC., Defendants-Respondents

Argued and Submitted November 6, 2012

Multnomah County Circuit Court. 100101157. Youlee Y. You, Judge.

Charles L. Perry, Texas, argued the cause for appellants. With him on the briefs were Andrews Kurth LLP, and Gregory J. Miner and Bateman Seidel Miner Blomgren Chellis & Gram, P.C.

Peter D. Hawkes argued the cause for respondents. With him on the brief was Lane Powell PC.

Before Armstrong, Presiding Judge, and Duncan, Judge, and Brewer, Judge pro tempore.

OPINION

Page 774

[262 Or.App. 505] ARMSTRONG, P. J.

Plaintiffs appeal a general judgment dismissing their breach of contract and declaratory relief action against defendants because of lack of subject matter and personal jurisdiction. They also appeal a supplemental judgment awarding attorney fees to defendants. We conclude that the court erred in determining that it lacked subject matter jurisdiction over the action. We further conclude that the theory that defendants advance on appeal to justify the trial court's decision regarding personal jurisdiction--that it would be unreasonable to enforce their consent to jurisdiction in Oregon--was not the basis upon which the trial court ruled. And, because the record might have developed differently if defendants had raised that issue in their motion to dismiss, we will not affirm the trial court's ruling under a " right for the wrong reason" rationale. We also decline to resolve the other grounds for dismissal raised by defendants that the trial court expressly did not reach--that is, forum non conveniens, improper joinder, and failure to state ultimate facts sufficient to constitute a claim. Accordingly, we reverse and remand the general judgment of dismissal. We also reverse the supplemental judgment awarding defendants attorney fees.

This case involves three Florida limited partnerships: the AOH-Regent Limited Partnership (AOH-Regent Partnership); the American Opportunity for Housing- James Park Limited Partnership (AOH-James Park Partnership); and the American Opportunity for Housing-Greenview Manor Limited Partnership (AOH-Greenview Partnership). Each limited partnership owns a low-income apartment project in Florida built with tax-credit financing under the Low Income Housing Tax Credit program administered by the Florida Housing Finance Corporation.

Plaintiffs are the limited partners in those partnerships.[1] Defendants are the limited partnerships; the [262 Or.App. 506] general partners of the limited partnerships; and the parent entity, American Opportunity for Housing, Inc. (AOH), which guaranteed the obligations of the general partners in each instance.[2] AOH is a Kansas nonprofit corporation that develops affordable multi-family housing. It has

Page 775

over 15,000 units of housing located in several states: Florida, Alabama, Arkansas, Illinois, and Pennsylvania. As noted, the three projects involved in this case are located in Florida--two (Greenview and James Park) in St. Petersburg, Pinellas County, and one (Regent) in Jacksonville, Duval County.

Plaintiffs brought breach of contract claims against defendants, alleging that defendants had breached their contractual obligations to repurchase plaintiffs' limited partnership interests on the occurrence (or, to be more precise, nonoccurence) of certain events. They also sought declaratory relief, asking the court to " declare the rights of the parties under the various contracts." For purposes of this appeal, it is not necessary for us to describe in detail the specifics of the limited-partnership agreements and plaintiffs' claims. Suffice it to say that each of the respective partnership agreements provides for the repurchase of plaintiffs' limited-partnership interests upon the satisfaction of certain conditions. The agreements also each provide that the repurchase obligation is an obligation of that partnership and that the general partner of each partnership guarantees the repurchase obligation. The repurchase obligations of the general partners are, in turn, guaranteed by AOH under separate guaranty agreements.[3]

As a remedy for their breach of contract claims, the investment limited- partner plaintiffs in each limited [262 Or.App. 507] partnership, see __ Or.App. at __ n 1 (slip op at 2 n 1) (identifying the investment limited partners), sought to recover against the applicable defendants the purchase price--in the amount of plaintiffs' alleged capital contributions [4]-- plus interest and the costs and expenses of the repurchase. Plaintiff Columbia Housing, the special limited partner in each of the partnerships, sought to recover its alleged contributions,[5] plus costs and expenses. All plaintiffs further sought full release from any future obligation to make capital contributions and " interest at 'an interest rate of the lesser of (a) Prime Rate plus 4%, compounded monthly or (b) the maximum rate permissible by law' from the conclusion of the 30-day period after the repurchase notice until paid."

Each of the three limited-partnership agreements contains, essentially,[6] the following provision:

" Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State. Each of the undersigned irrevocably (i) agrees that any suit, action or other legal proceeding arising out of this Agreement or any of the transactions contemplated hereby shall be brought in the courts of either the State of Oregon or State of Florida or the courts of the United States of America for the District of Oregon or the District of Florida; (ii) consents to the jurisdiction of each such court in any suit, action, or proceeding; and (iii) waives any objection which he or it may have to the laying of venue of any such suit, action or proceeding in each of such courts."
[7]

" Personal Jurisdiction and Venue. The Guarantor hereby submits to personal jurisdiction as provided in this Section 19 for the enforcement of this Guaranty and waives any and [262 Or.App. 508] all personal rights to object to such jurisdiction for the purposes of litigation to enforce this Guaranty. The Guarantor hereby consents to the jurisdiction of the courts of either the States of Oregon or Florida or the courts of the

Page 776

United States of America for the Districts of Oregon or Florida, in any action, suit, or proceeding which any Limited Partner may at any time wish to file in connection with this guaranty or any related matter. The Guarantor hereby agrees that an action, suit, or proceeding to enforce this Guaranty may be brought in any state or federal court in the States of Oregon or Florida and hereby waives any objection which the ...

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