Yes. The court decided that California had the power to hear the case. The insurance contract was so closely tied to California that it was fair for the company to be sued there. The policy was mailed to California, the payments came from California, and the person insured lived and died in California. It wouldn't be fair to make the man's mother travel all the way to Texas just to sue the company, especially when all the witnesses and evidence were likely in California.

Yes, it was okay for the California court to make a decision about the Texas insurance company because the insurance policy had a strong connection to California. The policy was sent there, payments were made from there, and the person with the policy lived there until he died. California has a real interest in making sure its residents can get money from insurance companies that should pay them. It would be very hard for people to have to go to other states to make insurance companies pay. The insurance company knew about the case and had time to get ready for it. The California law didn't change the policy itself; it just let McGee sue in California. The company didn't have a right to never be sued in California.

<?xml version="1.0" encoding="utf-8"?> <opinion type="majority"> *221 Opinion of the Court by <author id="AhM"> MR. Justice Black, </author> <judges id="ATH"> announced by Mr. Justice Douglas. </judges> Petitioner, Lulu B. McGee, recovered a judgment in a California state court against respondent, International Life Insurance Company, on a contract of insurance. Respondent was not served with process in California but by registered mail at its principal place of business in Texas. The California court based its jurisdiction on a state statute which subjects foreign corporations to suit in California on insurance contracts with residents of that State even though such corporations cannot be served with process within its borders. <a class="footnote" href="#fn1" id="fn1_ref"> 1 </a> Unable to collect the judgment in California petitioner went to Texas where she filed suit on the judgment in a Texas court. But the Texas courts refused to enforce her judgment holding it was void under the Fourteenth Amendment because service of process outside California could not give the courts of that State jurisdiction over respondent. 288 S. W. 2d 579. Since the case raised important questions, not only to California but to other States which have similar laws, we granted certiorari. 352 U. S. 924. It is not controverted that if the California court properly exercised jurisdiction over respondent the Texas courts erred .in refusing to give its judgment full faith and credit. 28 U. S. C. § 1738. The material facts are relatively simple. In 1944, Lowell Franklin, a resident of California, purchased a life insurance policy from the Empire Mutual Insurance Company, an Arizona corporation. In 1948 the respondent agreed with Empire Mutual to assume its insurance obligations. Respondent then mailed a reinsurance certificate to Franklin in California offering to insure him in accordance with the terms of the policy he held with Empire Mutual. He accepted this offer and from that *222 time until his death in 1950 paid premiums by mail from his California home to respondent’s Texas office. Petitioner, Franklin’s mother, was the beneficiary under the policy. She sent proofs of his death to the respondent but it refused to pay claiming that he had committed suicide. It appears that neither Empire Mutual nor respondent has ever had any office or agent in California. And so far as the record before us shows, respondent has never solicited or done any insurance business in California apart from the policy involved here. Since Pennoyer v. Neff, 95 U. S. 714, this Court has held that the Due Process Clause of the Fourteenth Amendment places some limit on the power of state courts to enter binding judgments against persons not served with process within their boundaries. But just where this line of limitation falls has been the subject of prolific controversy, particularly with respect to foreign corporations. In a continuing process of evolution this Court accepted and then abandoned “consent,” “doing business,” and “presence” as the standard for measuring the extent of state judicial power over such corporations. See Henderson, The Position of Foreign Corporations in American Constitutional Law, c. V. More recently in International Shoe Co. v. Washington, 326 U. S. 310, the Court decided that “due process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ” Id., at 316. Looking back over this long history of litigation a trend is clearly discernible toward expanding the permissible scope of state jurisdiction over foreign corporations and' other nonresidents. In part this is attributable to the fundamental transformation of our national economy over the years. Today many commercial transactions *223 touch two or more States and may involve parties separated by the full continent. With this increasing nationalization of commerce has come a great increase in the amount of business conducted by mail across state lines. At the same time modern transportation and communication have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity. Turning to this case we think it apparent that the Due Process Clause did not preclude the California court from entering a judgment binding on respondent. It is sufficient for purposes of due process that the suit was based on a contract which had substantial connection with that State. Cf. Hess v. Pawloski, 274 U. S. 352; Henry L. Doherty &amp; Co. v. Goodman, 294 U. S. 623; Pennoyer v. Neff, 95 U. S. 714, 735. <a class="footnote" href="#fn2" id="fn2_ref"> 2 </a> The contract was delivered in California, the premiums were mailed from there and the insured was a resident of that State when he died. It cannot be denied that California has a manifest interest in providing effective means of redress for its residents when their insurers refuse to pay claims. These residents would be at a severe disadvantage if they were forced to follow the insurance company to a distant State in order to hold it legally accountable. When claims were small or moderate individual claimants frequently could not afford the cost of bringing an action in a foreign forum— thus in effect- making the company judgment proof. Often the crucial witnesses — as here on the company’s defense of suicide — will be found in the insured’s locality. *224 Of course there may be inconvenience to the insurer if it is held amenable to suit in California where it had this contract but certainly nothing which amounts to a denial of due process. Cf. Travelers Health Assn. v. Virginia ex rel. State Corporation Comm’n, 339 U. S. 643. There is no contention that respondent did not have adequate notice of the suit or sufficient time to prepare its defenses and appear. The California statute became law in 1949, after respondent had entered into the agreement with Franklin to assume Empire Mutual’s obligation to him. Respondent contends that application of the statute to this existing contract improperly impairs the obligation of the contract. We believe that contention is devoid of merit. The statute was remedial, in the purest sense of that term, and neither enlarged nor impaired respondent’s substantive rights or obligations under the contract. It did nothing more than to provide petitioner with a California forum to enforce whatever substantive rights she might have against respondent. At the same time respondent was given a reasonable time to appear and defend on the merits after being notified of the suit. Under such circumstances it had no vested right not to be sued in California. Cf. Bernheimer v. Converse, 206 U. S. 516; National Surety Co. v. Architectural Decorating Co., 226 U. S. 276; Funkhouser v. J. B. Preston Co., 290 U. S. 163. The judgment is reversed and the cause is remanded to the Court of Civil Appeals of the State of Texas, First Supreme Judicial District, for further proceedings not inconsistent with this opinion. It is so ordered. <judges id="b308-9"> The Chief Justice took no part in the consideration or decision of this case. </judges> <div class="footnotes"><div class="footnote" id="fn1" label="1"> <a class="footnote" href="#fn1_ref"> 1 </a> Cal. Insurance Code, 1953, §§ 1610-1620. </div><div class="footnote" id="fn2" label="2"> <a class="footnote" href="#fn2_ref"> 2 </a> And see Ace Grain Co. v. American Eagle Fire Ins. Co., 95 F. Supp. 784; Storey v. United Ins. Co., 64 F. Supp. 896; S. Howes Co. v. W. P. Milling Co., 277 P. 2d 655 (Okla.); Compañía de Astral, S. A. v. Boston Metals Co., 205 Md. 237, 107 A. 2d 357, cert. denied, 348 U. S. 943; Zacharakis v. Bunker Hill Mut. Ins. Co., 281 App. Div. 487, 120 N. Y. S. 2d 418; Smyth v. Twin State Improvement Co., 116 Vt. 569, 80 A. 2d 664. </div></div></opinion>

"It is sufficient for purposes of due process that the suit was based on a contract which had substantial connection with that State."

As long as it creates a substantial connection with the forum state, even a single act can support jurisdiction.

—the Supreme Court held that a single contract of life insurance had a "substantial" connection with the forum state sufficient to confer jurisdiction over a foreign insurance company.

—an insurance contract was sent to a resident of California by a Texas insurance company, and the resident sent premiums to Texas from his home in California, the Court held that California properly exercised jurisdiction over a suit brought on the contract by the resident against the insurance company, even though the contract was the insurance company's only …

At the same time modern transportation and communication have made it much less burdensome for a party sued to defend himself in a state where he engages in economic activity.

—a state "has a manifest interest in providing effective means of redress for its residents when their insurers refuse to pay claims

"[B] ecause `modern transportation and communications have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity,'it usually will not be unfair to subject him to the burdens of litigating in another forum for disputes relating to such activity. "

"Looking back over this long history of litigation a trend is clearly discernible toward expanding the permissible scope of state jurisdiction over foreign corporations and other nonresidents. In part this is attributable to the fundamental transformation of our national economy over the years. Today many commercial transactions touch two or more States and may involve …

It is well settled that due process requires that the non-resident defendant have certain minimum contacts with the forum state out of which the cause of action arose.

No. The Due Process Clause does not preclude the California court from entering a judgment binding on the respondent. A state has personal jurisdiction over a party when a suit is based on a contract that has a substantial connection with that state. The Court's reasoning followed a discernible trend toward expanding the permissible scope of state jurisdiction over foreign corporations, moving away from rigid tests like 'consent' or 'presence' toward the more flexible 'minimum contacts' standard from *International Shoe Co. v. Washington*. Here, the contract was delivered in California, the premiums were mailed from California, and the insured was a resident of California when he died. Furthermore, California has a manifest interest in providing an effective means of redress for its residents when insurers refuse to pay, as residents would be at a severe disadvantage if forced to sue in a distant state. The inconvenience to the insurer of defending in California was not so great as to amount to a denial of due process.

Yes, the Due Process Clause did not preclude the California court from entering a judgment binding on the respondent because the contract had a substantial connection with California. It was delivered there, premiums were mailed from there, and the insured was a resident there when he died. California has a manifest interest in providing effective means of redress for its residents when insurers refuse to pay claims. Residents would be at a severe disadvantage if forced to follow insurance companies to distant states to hold them legally accountable. The respondent had adequate notice of the suit and sufficient time to prepare its defenses and appear. The California statute was remedial and neither enlarged nor impaired the respondent's substantive rights or obligations under the contract; it merely provided McGee with a California forum to enforce whatever substantive rights she had. Under these circumstances, the respondent had no vested right not to be sued in California.

No, the Due Process Clause did not preclude the California court from entering a judgment binding on the respondent because the contract had a substantial connection with California. It was delivered there, premiums were mailed from there, and the insured was a resident there when he died. California has a manifest interest in providing effective means of redress for its residents when insurers refuse to pay claims. Residents would be at a severe disadvantage if forced to follow insurance companies to distant states to hold them legally accountable. The respondent had adequate notice of the suit and sufficient time to prepare its defenses and appear. The California statute was remedial and neither enlarged nor impaired the respondent's substantive rights or obligations under the contract; it merely provided McGee with a California forum to enforce whatever substantive rights she had. Under these circumstances, the respondent had no vested right not to be sued in California.

McGee v. International Life Insurance Co.

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