FORUM SELECTION CLAUSE ENFORCED BY MANDAMUS: In re International Profit Assoc. Inc. (Tex. 2009)

TEXAS SUPREME COURT GRANTS PETITION FOR MANDAMUS TO ENFORCE CONTRACTUAL FORUM-SELECTION CLAUSE

In re Int'l Profit Associates, Inc. (Tex. 2009)
No. 08-0531 (Tex. Jun. 12, 2009) (per curiam) (mandamus granted to enforce forum selection and choice-of-law clause) (methods to challenge forum selection clauses) (enforceability of forum selection clause) (sufficiency of disclosure of contractual terms)

FROM THE PER CURIAM OPINION:

In a recent case also involving IPA and the enforceability of a forum-selection clause, we explained that, as a general rule, forum-selection clauses are enforceable, and the party challenging the forum-selection clause bears a heavy burden of proof. In re Int’l Profit Assocs., Inc., 274 S.W.3d 672, 675 (Tex. 2009) (citing In re Lyon, 257 S.W.3d at 231–32).

A trial court abuses its discretion in refusing to enforce the forum-selection clause, unless the party opposing enforcement of the clause can clearly show that: (1) enforcement would be unreasonable or unjust, (2) the clause is invalid for reasons of fraud or overreaching, (3) enforcement would contravene a strong public policy of the forum where the suit was brought, or (4) the selected forum would be seriously inconvenient for trial. Id. Applying this standard to the present case, we conclude that the trial court clearly abused its discretion by placing the burden of proof on IPA to demonstrate that it showed the forum-selection clause to Riddell.
* * *
[T]he party challenging a forum-selection clause has the burden of proving the clause is invalid, and the party seeking to enforce the forum-selection clause is not obligated to prove that it specifically showed the clause to the opposing party as a condition of enforcement. Because the trial court placed the burden of proof on IPA and required the company to prove that it showed the forum-selection clause to Riddell, it clearly abused its discretion in denying IPA’s motion to dismiss. Accordingly, we conditionally grant mandamus relief and direct the trial court to vacate its order denying IPA’s motion to dismiss and enter an order granting the motion.

IN RE INTERNATIONAL PROFIT ASSOCIATES, INC., INTEGRATED BUSINESS ANALYSIS, INC., ACCOUNTANCY ASSOCIATES, LLC., INTERNATIONAL TAX ADVISORS, INC., AND HUEY MITCHELL, JR.; from Dallas County; 5th district (05-08-00809-CV, ___ SW3d ___, 06-30-08)stay order issued March 11, 2009, lifted
Pursuant to Texas Rule of Appellate Procedure 52.8(c), without hearing oral argument, the Court conditionally grants the petition for writ of mandamus.Per Curiam Opinion
Per Curiam Opinion [pdf version of opinion on Supreme Court's website]

RELATED CONCEPTS: ENFORCEABILITY OF CONTRACTS, WAIVERS: conspicuousness requirement, knowing waiver of right to jury trial Jury waiver enforceability of arbitration agreement CONTRACT FORMATION AND ENFORCEABILITY: party has duty to read what he signs

When indemnity hinges on choice of law | Texas Supreme Court remands case for application of LA law

Contractual Choice of Law: Case remanded for retrial under Louisiana law. In prior mandamus proceeding Court granted insurer opportunity to participate as nonparty in appeal.

Sonat Exploration Co. v. Cudd Pressure Control, Inc.
No. 06-0979 (Tex. Nov. 21, 2008) (Brister)(choice of law where no express provision in the contract applied to the oilfield accident in Louisiana, duty to indemnify, Rule 11 Agreement, intervention of insurer in appeal)
SONAT EXPLORATION COMPANY v. CUDD PRESSURE CONTROL, INC.; from Harrison County; 6th district (06-03-00077-CV, 202 SW3d 901, 09-26-06) 2 petitions The Court affirms the court of appeals' judgment, but on different grounds. Justice Brister delivered the opinion of the Court.

FROM THE OPINION: This case returns to us after we ordered that an insurer be allowed to argue on appeal a choice-of-law issue that its insured had waived.[1] The court of appeals sustained the insurer’s point, finding that Louisiana law applied because it was the place the contract was performed and was impliedly chosen by the parties. While we disagree with those reasons, we agree with the court’s ultimate conclusion that Louisiana law applies and that remand is required. Accordingly, we affirm.

Prior mandamus case: In re Lumbermens Mut. Cas. Co., 184 S.W.3d 718 (Tex. 2006)("We hold that under the unusual circumstances this case presents, Lumbermens is entitled to invoke the virtual-representation doctrine to raise on appeal the choice-of-law issue its insured abandoned in order to settle uninsured claims in another suit, and the court of appeals abused its discretion in holding otherwise. Accordingly, we conditionally grant the writ of mandamus and direct the court of appeals to permit Lumbermens’ participation to contest the trial court’s choice-of-law ruling. The writ will issue only if the court fails to do so.")