Forum Selection Clauses

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Bridget M. Friedman had an article selected to be published in the Winter 2015 issue of ActionLine (Vol. XXXVII, No. 2), a publication of The Real Property Probate and Trust Law Section of the Florida Bar.

In Florida, contracting parties are permitted to agree that any litigation stemming from their contract be heard in a specific forum. See Weisser v. PNC Bank, N.A., 967 So. 2d 327 (Fla. 3d DCA 2007). Forum selection clauses are generally mandatory or permissive. Id. The general test for determining whether a clause is mandatory or permissive is language indicating “exclusivity.” See Golden Palm Hospitality v. Stearns Bank Nat’l Ass’n, 874 So. 2d 1231, 1236 (Fla. 5th DCA 2004). “Absent such language, the clause will be considered permissive.” Id. If the forum selection clause “state[s] or clearly indicate[s] that any litigation must or shall be initiated in a specified forum,” then it is mandatory. See Shoppes L.P. v. Conn, 829 So. 2d 356, 358 (Fla. 5th DCA 2002). If, on the other hand, a venue clause is determined to be permissive, then it is “nothing more than a consent to jurisdiction and venue in the named forum and do[es] not exclude jurisdiction or venue in any other forum.” See Regal Kitchens, Inc. v. O’Connor & Taylor Condo. Constr., Inc, 894 So. 2d 288, 289 (Fla. 3d DCA 2005); and Garcia Granados Quinones v. Swiss Bank Corp. (Overseas), S.A., 509 So. 2d 273, 274-75 (Fla. 1987).

If a particular forum is desirable, counsel should consider these cases when drafting a forum selection clause. For example, language such as “any litigation must be initiated in Orange County, Florida” would indicate a mandatory forum of Orange County, Florida. However, language such as “any litigation arising out of this contract may be brought in Orange County, FL” indicates that Orange County is a permissive forum, and if litigation were to arise, it could be brought in a forum other than one named in the contract.

Even if a mandatory forum selection clause is incorporated into an agreement, counsel should be aware that “[i]t is generally appropriate for a court in Florida, as a procedural issue, to determine the validity and enforceability of a forum selection clause despite a choice of law provision in the agreement.” See Golden Palm Hospitality, Inc. v. Stearns Bank Nat. Ass’n, 874 So. 2d 1231, 1234-35 (Fla. 5th DCA 2004). A trial court must enforce a mandatory forum selection clause in a contract so long as there is not a showing that the clause is unreasonable or unjust. See Travel Exp. Inv. Inc. v. AT&T Corp., 14 So 3d 1224, 1226 (Fla. 5th DCA 2009).

Courts look at three factors to determine if a provision is unreasonable or unjust: whether the forum was chosen because of overwhelming bargaining power which would constitute overreaching; whether the enforcement would contravene strong public policy enunciated by statute or judicial fiat, either in the forum where the suit would be brought, or the forum from which the suit has been excluded; and whether the purpose was to transfer an essentially local dispute to a remote and alien forum in order to seriously inconvenience one or both of the parties. See Ware Else, Inc. v. Ofstein, 856 So. 2d 1079, 1081 (Fla. 5th DCA 2003).

If you have any questions regarding forum selection clauses, please feel free to contact Bridget M. Friedman at (407) 830-6331 or bfriedman@ff-attorneys.com.