ZINTER, Justice.
[¶ 1.] Plaintiff-Appellee Spiska Engineering, Inc. (Spiska) commenced an action for breach of contract against Defendant-Appellee SPM Thermo-Shield, Inc. (Thermo-Shield). Following a number of proceedings and appeals relating to arbitration of the dispute, an arbitration award was confirmed and Spiska obtained a money judgment against Thermo-Shield. A receiver was subsequently appointed to satisfy the judgment by liquidation of Thermo-Shield's assets. Appellant Joseph
[¶ 2.] In 2007, this Court affirmed a circuit court's confirmation of Spiska's arbitration award of $4,999,257 against Thermo-Shield. See Spiska Eng'g, Inc. v. SPM Thermo-Shield, Inc., 2007 S.D. 31, ¶¶ 1, 5, 730 N.W.2d 638, 641, 642. The award was based on Thermo-Shield's wrongful termination of Spiska's European contracts involving the use of ceramic coatings. Id. ¶¶ 2, 5. Following confirmation of the arbitration award, discovery was conducted to enforce the judgment. Raver, Thermo-Shield's sole shareholder, president and CEO, was deposed. Raver disclosed that he had personally sold certain product formulae and rights to manufacture and market Thermo-Shield's products in return for a twenty percent share in a German corporation. It is undisputed that the product formulae were at one time (and possibly still are) closely-guarded trade secrets. There is also no dispute that the product formulae, as well as all rights associated with the products, belonged to Thermo-Shield rather than Raver. Nevertheless, Spiska never asserted any kind of personal claim against Raver in this action.
[¶ 3.] On May 30, 2007, the circuit court appointed a receiver over Thermo-Shield. The receiver was charged with the duty of identifying, compiling, and selling Thermo-Shield's assets to satisfy Spiska's judgment. The receiver later identified a purchaser of the assets, negotiated a proposed purchase agreement, and moved the circuit court for approval of the sale.
[¶ 4.] On April 12, 2010, the receiver sent Raver and other potentially interested persons a Motion to Approve Sale and Notice of Hearing. The motion and notice were sent by U.S. mail. The motion did not assert a claim for injunctive relief against Raver. The motion and notice simply identified the terms of the proposal and gave recipients an opportunity to object or waive their right to object to the sale and disposition of the proceeds. Pursuant to that motion and notice, Raver filed an objection claiming that the proposed sale failed to allocate a portion of the proceeds to satisfy a personal loan of $48,659.80 he allegedly made to Thermo-Shield. Raver appeared through counsel to preserve his objection at the hearing on the receiver's motion to approve the sale. At the conclusion of the hearing, the circuit court granted the receiver's motion to sell Thermo-Shield's assets. The court awarded no injunctive relief against Raver.
[¶ 5.] Although no claim for injunctive relief had been sought or awarded at the hearing, language awarding injunctive relief appeared in the receiver's proposed findings of fact, conclusions of law, and order approving the sale. Raver timely objected to that language arguing that procedurally, injunctive relief had not been "addressed in the [receiver's] motion, briefed by any party, [or] addressed at the hearing." Raver contended that it would be an injustice to grant the proposed injunction "without taking any evidence, and
[¶ 6.] The circuit court overruled Raver's objections and adopted the receiver's proposed findings, conclusions, and order. One part of the order provided: ". . . Mr. Raver may not obtain an ownership interest in, or serve in a management capacity with any company that manufactures ceramic coatings or paint products[,] which in any way competes with SPM Thermo-Shield, Inc. or any successor to its assets." Raver appeals this provision alleging that the circuit court did not have in personam jurisdiction to grant injunctive relief. Raver also contends that the terms of the injunction are unreasonable and an unlawful restraint of trade in violation of SDCL 53-9-8.
[¶ 7.] We begin by considering the circuit court's in personam jurisdiction to grant the permanent injunction. Issues regarding a court's jurisdiction are questions of law that are reviewable de novo. Grajczyk v. Tasca, 2006 S.D. 55, ¶ 8, 717 N.W.2d 624, 627.
[¶ 8.] "The consistent constitutional rule has been that a court has no power to adjudicate a personal claim or obligation unless it has jurisdiction over the person of the defendant." Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 110, 89 S.Ct. 1562, 1569, 23 L.Ed.2d 129 (1969). "Without a proper basis for [personal] jurisdiction, or in the absence of proper service of process, [a court] has no power to render any judgment against the defendant's person or property unless the defendant has consented to jurisdiction or waived the lack of process." SEC v. Ross, 504 F.3d 1130, 1138-39 (9th Cir.2007) (considering a receiver's unsuccessful attempt to exercise jurisdiction over money held by a nonparty who had allegedly violated securities laws but had not been personally served or named in a summons and complaint).
[¶ 9.] In this case there is no dispute that Raver was not designated as a party. Furthermore, although the receiver mailed Raver a copy of the notice of hearing on the motion for approval of the sale, that mailing was not sufficient to commence an action against Raver. See SDCL 15-6-3 ("A civil action is commenced as provided in §§ 15-2-30 and 15-2-31."); SDCL 15-2-30 ("An action is commenced as to each defendant when the summons is served on
[¶ 10.] Appellees, however, argue that Raver waived any objection to personal jurisdiction and insufficient service of process. They first contend that Raver waived those objections by failing to file a motion to dismiss. Personal jurisdiction and insufficiency of service of process are defenses that may be waived. Grajczyk, 2006 S.D. 55, ¶ 9, 717 N.W.2d at 627. "SDCL 15-6-12(h)(1) provides that the defenses are waived if they are not included in a motion under the circumstances provided in SDCL 15-6-12(g) or in a responsive pleading[.]" Id.
[¶ 11.] Appellees also contend that Raver waived these defenses by filing an objection to the sale and appearing before the court on that objection. In determining whether an appearance constitutes submission to in personam jurisdiction, we look to the relief requested and "the real question is whether there is a submission to the power of the court or an active invocation of its power on nonjurisdictional matters." Grajczyk, 2006 S.D. 55, ¶ 12, 717 N.W.2d at 628.
[¶ 12.] At the time Raver appeared on his objection to the sale, there were no nonjurisdictional issues remaining before the circuit court other than the sale of Thermo-Shield's assets. No claim for injunctive relief had been asserted. Further, Raver's appearance on his objection
[¶ 13.] Thermo-Shield and Spiska mistakenly rely on Robinson v. Glover, 60 S.D. 270, 244 N.W. 322 (S.D.1932); Matter of J.W.W., 334 N.W.2d 513 (S.D.1983); and In re Guardianship and Conservatorship of Miles, 2003 S.D. 34, 660 N.W.2d 233. In Robinson and J.W.W., the plaintiff had actually commenced an action against the party contesting jurisdiction. See Robinson, 244 N.W. at 323 (referencing the underlying appeal of Robinson v. Glover, 59 S.D. 332, 239 N.W. 848 (1931), which reflected that an action seeking the relief requested had been commenced); J.W.W., 334 N.W.2d at 515 (involving a case where a summons and complaint seeking termination of parental rights had been served by publication). Because those were cases in which an action had been properly commenced, it was foreseeable that the responding parties would waive jurisdictional defenses by voluntarily appearing.
[¶ 14.] Miles is also inapposite. In Miles, a trust beneficiary's guardian and conservator filed an annual accounting, and a nonresident trustee filed a "special appearance" to object to the accounting. 2003 S.D. 34, ¶¶ 6-8, 660 N.W.2d at 235. The circuit court approved the accounting and also ordered the conservator to make a demand on the trustee for funds beyond the income that the South Dakota beneficiary normally received. Id. ¶ 8. Notwithstanding the special appearance, we held that the circuit court had personal jurisdiction over the trustee to order such payments because the trustee voluntarily appeared, testified concerning trust matters, negotiated payment of trust funds to the trustee, requested the court to act on other matters regarding the trust, sent interrogatories to the guardian, and litigated payment of funds in his trustee capacity. Id. ¶¶ 40-41, 45. In contrast, Raver did not invoke the powers of the court for any purpose other than to respond to the receiver's request for objections to the proposed sale. Raver's limited response was not analogous to the voluntary invocation of numerous court powers in Miles.
[¶ 15.] This case is more analogous to Ross, 504 F.3d 1130. In that case, the SEC commenced a civil enforcement action against Alpha Telecom for violations of federal securities statutes. Id. at 1133. A receiver was appointed to preserve and manage Alpha Telecom's assets. Id. The receiver subsequently filed a motion to disgorge commissions on sales of unregistered securities made by Alpha Telecom's sales agents. Id. at 1133-34. However, the receiver did not commence an action against the agents or personally serve them with the motion. The receiver merely sent the nonparty agents a notice of hearing by first-class mail. Id. at 1135. The district court found that it had jurisdiction over the agents because disgorgement related to receivership matters pertaining to the company's assets, and the court entered judgment ordering disgorgement from individual nonparty agents. Id.
[¶ 16.] The Ninth Circuit reversed noting that "service of process is the means by which a court asserts its jurisdiction over the person." Id. at 1138. The court concluded that in personam jurisdiction could not be obtained by merely naming the agents in a motion. Id. at 1140-41. The court further concluded that there was no jurisdiction because the receiver "never filed a complaint and never named [the agents] as a party. In other words, [there was no jurisdiction because] the Receiver never commenced an action against [the agents.]" Id. at 1140.
[¶ 17.] The court also rejected the argument that jurisdiction existed because the agents were exercising rights over receivership assets as nominal defendants.
[¶ 18.] In this case Spiska and the receiver's basis for injunctive relief is their contention that Raver violated South Dakota's Trade Secrets Act.
[¶ 19.] Under these circumstances, we conclude that the circuit court never acquired in personam jurisdiction to grant
[¶ 20.] Reversed and remanded for further proceedings consistent with this opinion.
[¶ 21.] GILBERTSON, Chief Justice, and KONENKAMP, MEIERHENRY, and SEVERSON, Justices, concur.