OPINION OF THE COURT
SEITZ, Chief Judge.
Compagnie des Bauxites de Guinee (CBG) appeals from an order of the district court dismissing its complaint based on diversity jurisdiction against three of its insurers for want of in personam jurisdiction, as time barred, and because its loss was not caused by a fortuitous event. It is not suggested that any law other than that of the forum is controlling, and we will therefore apply the law of Pennsylvania. The Court of Appeals has jurisdiction under 28 U.S.C. § 1291.
The parties are not strangers to this court. The events giving rise to this suit and much of the relevant history of the case are reported in a previous opinion, Compagnie des Bauxites de Guinee v. Insurance Company of North America, 651 F.2d 877 (3d Cir.1981), aff'd sub nom Insurance Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 102 S.Ct. 2099, 72 L.Ed.2d 492 (1982). We will therefore state only those facts relevant to this appeal.
In December of 1975 CBG filed an action in the district court against the Insurance Company of North America (INA) and a number of foreign excess insurers (the excess insurers), including the appellees in this case, in order to recover under an all-risk business interruption insurance policy covering its bauxite mining and processing plant in the Republic of Guinea. In August of 1976 CBG began a series of fruitless attempts to take discovery for the purpose of showing the excess insurers' contacts with Pennsylvania. For the next three years most of the excess insurers repeatedly refused to comply with CBG's discovery requests and the district court's discovery orders.
In March of 1979 the excess insurers filed suit in England, seeking to rescind the excess insurance policies. CBG moved to enjoin the excess insurers from proceeding with this action. On April 19 the district court preliminarily enjoined the English suit. It also imposed a sanction against the excess insurers for noncompliance with its discovery orders, pursuant to Fed.R.Civ.P. 37(b)(2)(A), by taking as established the facts which would support in personam jurisdiction. The district court also held that, notwithstanding the sanction, CBG had introduced sufficient evidence to independently establish the court's jurisdiction over all the excess insurer defendants.
The excess insurers hired new counsel, who promptly noticed a series of depositions in England in connection with the English suit. These depositions were apparently also intended to show that the excess insurers could not be sued in Pennsylvania. CBG moved for a protective order. The district court granted the order, holding that in personam jurisdiction "shall not be the subject of further discovery, testimony or evidence in this case...." In November, a permanent injunction hearing was held regarding the English suit. Pursuant to the protective order, neither side introduced new evidence or testimony on jurisdiction at this hearing. The permanent injunction issued in August 1980, the district court holding that it had in personam jurisdiction based on the sanction and on the evidence relating to jurisdiction which was in the record of the preliminary injunction hearing.
The excess insurers took an interlocutory appeal to this court. Our review of the permanent injunction included review of its jurisdictional basis. We affirmed the discovery sanction as to all except the three appellees in this case, L'Union Atlantique S.A. d'Assurances (now L'Union Atlantique S.A. de Reassurances) (UNAT); Vesta (U.K.) Insurance Co. (Vesta); and Chiyoda Fire & Marine Insurance Co., Ltd., Tokyo (Chiyoda). We held that the sanctions should not apply to them because they had cooperated with the district court's discovery
After the district court, 555 F.Supp. 1027, granted the three insurers' motion to dismiss them from the 1975 action, CBG filed a new action against them, based on the same facts and alleging the same cause of action as in the 1975 suit from which they had just been dismissed. The three excess insurers moved to dismiss, claiming that the district court lacked in personam jurisdiction and that our previous dismissal on jurisdictional grounds in the 1981 appeal was res judicata or a collateral estoppel and prevented relitigating the insurers' amenability to Pennsylvania process. The motion to dismiss was twice amended to add defenses based on the running of the statute of limitations and the non-occurrence of a fortuitous event.
While the motion to dismiss was pending, CBG directed interrogatories to each of the defendants in order to discover their contacts with Pennsylvania, and the insurers moved for a protective order. The district court neither directed that the interrogatories be answered nor issued a protective order, but in February 1983, it granted the insurers' motion to dismiss. The district court held that our prior dismissal was res judicata and that CBG could not relitigate the jurisdiction issue. In addition, the district court reached the other two grounds for dismissal, holding that CBG's suit was time barred and that no recovery was available as a matter of law because CBG's losses were not caused by a fortuitous event.
We first address the district court's holding that our dismissal of the insurers in the 1981 appeal was res judicata as to the new suit against the three excess insurers. CBG argues first, that the principle of res judicata does not apply at all because the merits were never reached in the prior case. Second, CBG argues that any collateral estoppel applies only to the issue actually determined in the prior action, which was whether in personam jurisdiction existed when the first suit was filed in December of 1975. Thus, according to CBG the amenability of UNAT, Vesta and Chiyoda to suit in August of 1982 remains an open question.
We agree with CBG that the doctrine of res judicata, or claim preclusion, does not prevent this suit from being brought. The branch of res judicata which the excess insurers would have us apply, and which the district court did apply, is known as bar. Bar is invoked in order to prevent a second suit on a cause of action which has already been decided on the merits. Here the doctrine of bar does not apply because a dismissal for want of in personam jurisdiction is not a judgment on the merits of the cause of action itself. Fed.R.Civ.P. 41(b); see also Restatement of Judgments (Second) § 20(a) and comment c. Since the prior judgment in the district court did not go to the merits, CBG was entitled to file a second suit on the same cause of action. Etten v. Lovell Manufacturing Co., 225 F.2d 844, 846 (3d Cir.1955), cert. denied, 350 U.S. 966, 76 S.Ct. 435, 100 L.Ed. 839 (1956); Thomas v. Furness (Pacific) Ltd., 171 F.2d 434, 435 (9th Cir.1948); Bucholz v. Hutton, 153 F.Supp. 62, 68-69 (D.Mont.1957); Radakovich v. Weisman, 241 Pa.Super. 35, 359 A.2d 426, 430-31 (1976). Cf. Orange Theatre Corp. v. Rayherstz Amusement Corp., 139 F.2d 871, 875 (3d Cir.) (in banc), cert. denied, 322 U.S. 740, 64 S.Ct. 1057, 88 L.Ed. 1573 (1944).
The insurers maintain that the prior action did go to the merits of the claim, citing Angel v. Bullington, 330 U.S. 183, 67 S.Ct. 657, 91 L.Ed. 832 (1947), for the proposition that "the `merits' of a claim are disposed of when they are denied enforcement." Id. at 190, 67 S.Ct. at 661. Angel did not involve a question of in personam jurisdiction, but rather a litigant's attempt to obtain a deficiency
CBG is also correct in arguing that the doctrine of collateral estoppel, or issue preclusion, does not prevent it from litigating the jurisdiction issue in the 1982 suit. For collateral estoppel to apply the parties must have had an opportunity to fully litigate the issue in the prior proceeding. Public Service Mutual Insurance Co. v. Cohen, 616 F.2d 704, 707 (3d Cir.1980); Safeguard Mutual Insurance Co. v. Williams, 463 Pa. 567, 345 A.2d 664, 668 (1975).
The three excess insurers argue that any inability to compile a complete record on jurisdiction traceable to the district court's protective order is actually the fault of CBG, since it was CBG that moved for the order in the first place. Thus, they argue that CBG should have to bear the consequences of the trial strategy it adopted in the 1975 suit. There are two problems with this argument. First, we do not believe it appropriate to charge any litigant with perfect foresight as to the consequences of his trial strategy. This is especially true given the unique way in which the jurisdiction issue was concluded in the district court. Second, CBG did not move for the protective order out of mere whimsy, but did so only to enforce a sanction entered after years of having their discovery requests ignored and the orders of the district court flouted. This court held in the 1981 appeal that the three insurers had cooperated with discovery so that the sanction should not apply to them, and that the English suit could proceed. Nonetheless, in this appeal we cannot say that CBG acted unreasonably in enforcing the sanction by moving for the protective order, under the circumstances as they appeared at the time CBG did so. Because CBG acted reasonably when it moved for the protective order, and because what happened after it did so was unforeseeable, we will not bind CBG to the consequences of its trial strategy by holding it collaterally estopped by the 1981 appeal.
Pennsylvania's long-arm statutes, which govern service of process in this diversity action, reflect this dichotomy. 42 Pa.Cons.Stat.Ann. § 5101 provides for service of process on a corporation which does continuous and systematic business in the state, regardless of whether the event or transaction sued on took place in Pennsylvania. On the other hand, a single forum-related contact is sufficient to give jurisdiction under 42 Pa.Cons.Stat.Ann. § 5322, but the cause of action must arise out of that contact. CBG has not stated what theory it is pursuing, but it is clear that it must show either that its insurance policies are forum-related, or else that the insurers do so much unrelated business in Pennsylvania that to sue them in a Pennsylvania court would not offend due process.
In any action the plaintiff bears the burden of demonstrating contacts with the forum state sufficient to give the court in personam jurisdiction. Where the plaintiff's claim is not clearly frivolous, the district court should ordinarily allow discovery on jurisdiction in order to aid the plaintiff in discharging that burden. Our cases have held as much. See, e.g., Fraley v. Chesapeake & Ohio Railway, 397 F.2d 1 (3d Cir.1968); White-Evans Manufacturers v. Elevator Sales & Service, 543 F.Supp. 398 (E.D.Pa.1982); Strick Corp. v. AJF Warehouse Distributors, Inc., 532 F.Supp. 951 (E.D.Pa.1982). We note also that a Pennsylvania court would normally allow discovery where the plaintiff is attempting to show either "minimum contacts" or that the defendant is "doing business" in the state. Holt Hauling & Warehousing Systems, Inc. v. Aronow Roofing Co., 309 Pa.Super. 158, 454 A.2d 1131 (1983); Laffey v. Lehigh Valley Dairy Co-op., 257 Pa.Super. 45, 390 A.2d 238 (1978). The rule that discovery should be allowed has perhaps been best stated by the Court of Appeals for the First Circuit:
Surpitski v. Hughes-Keenan Corporation, 362 F.2d 254, 255-56 (1st Cir.1966). We note also that in the 1975 version of this very case the district court allowed discovery on jurisdiction, and only terminated discovery after the sanction was imposed taking jurisdiction as established. The logic which compelled discovery in the prior case seems equally applicable here.
Finally, we address the scope of discovery on remand. The plaintiffs have directed interrogatories to each of the three excess insurers. No response has yet been filed. Defendants have also moved for a protective order objecting to the breadth of the interrogatories. The district court did
The district court also found that CBG's claim against the three excess insurers was time barred because it was not filed within one year of the inception of the loss, as required by the insurance contract.
We are compelled to reverse the district court's holding that CBG's suit was not timely filed because disputed issues of fact as well as undecided questions of law prevent a dismissal on this ground, at least at this time.
The first step in the inquiry is to decide whether the 12-month provision is even a part of the contract of insurance. It appears as lines 157-161 of the cover sheet of the business interruption insurance policy issued by INA and adopted "as far as applicable" by the excess insurers. The cover sheet is actually INA's standard form fire insurance policy. The language in lines 157-161 is required by statute to be included in every fire insurance policy issued in Pennsylvania, but this statute expressly does not include all-risk policies such as the one at issue here. 40 Pa.Stat.Ann. § 636(2), (3). The cover itself states that the policy of which it is a part does not cover business interruption. On the other hand, the cover sheet does include some essential terms, such as the extent of coverage, the premium charged, and the dates during which the policy is in force. In determining whether the 12-month limitation is a part of the contract, relevant facts in dispute include whether any industry custom covers the inclusion of provisions such as the 12-month limitation, and the extent to which the terms of the policy were negotiated.
If the district court finds that the 12-month provision is part of the insurance contract, the next step is to determine whether the suit was filed after the 12-month
A third intermediate step not addressed by the district court involves whether, assuming the 12-month period applies and that CBG has not filed suit within that time, Pennsylvania law recognizes any impediment to enforcing the 12-month bar. In particular, the district court did not address the applicability of Brakeman v. Potomac Insurance Co., 472 Pa. 66, 371 A.2d 193 (1977), in which the Pennsylvania Supreme Court refused to enforce a notice of loss provision absent a showing that the insured's failure to comply with the provision prejudiced the insurer. The Pennsylvania Supreme Court has not yet ruled on the applicability of Brakeman to a 12-month provision not required by statute to be included as part of the policy.
Once the intermediate steps not addressed by the district court are thus outlined, it is evident that it was premature to reach the issue of the applicability of the savings statute, much less to grant a motion to dismiss on that basis. Nor can we say that the district judge must have decided these issues implicitly, since we have found in any event that he could not properly do so on the basis of the record before him.
The district court, as a third ground for dismissal, held that no recovery was possible as a matter of law because CBG's loss was not caused by a fortuitous event.
The judgment of the district court will be reversed and the case remanded to the district court for further proceedings consistent with this opinion.