I can think of no better person to answer the burning question, “What law governs forum selection clauses?” than the inestimable Symeon C. Symeonides, of conflict-of-laws fame. Symeonides has stepped into the breach to assist civil procedure and federal courts professors everywhere with an exhausting analysis of how to resolve the problems relating to applicable law as it applies to contractual forum selection clauses.
Some may remember that the Supreme Court in Atlantic Marine Construction Co., Inc. v. United States District Court for the Western District of Texas avoided (or evaded) this fundamental question. Instead, focusing on proper procedure, the Court held that a forum selection clause is appropriately enforced through a venue transfer motion under 28 U.S.C. § 1404(a).
Having resolved this vexing procedural issue, the Court left unanswered an array of irksome foundational questions. In the final analysis the Court’s entire Atlantic Marine edifice was erected on the premise that the forum selection clause in that case was valid. In footnote 5, the Court simply noted that “[its] analysis presuppose[d] a contractually valid forum-selection clause.”
Atlantic Marine proceeds from a presupposition of validity, which invites the question of how to decide if a forum selection clause is, in fact, valid. At a minimum, three legitimate questions arise: (1) what body of law applies to evaluate the validity and enforceability of a forum selection clause? (2) what court should make that determination? and (3) when should that determination be made? The analysis is further complicated depending on whether or not the contract also contains a choice-of-law provision. A choice-of-law provision might point to the application of a law other than the law of the plaintiff’s chosen forum. In such cases, as a matter of first instance, does the plaintiff’s chosen forum apply its own law to determine the validity and enforceability of the clauses, or does the choice-of-law provision compel interpretation of validity and enforceability based on the contractual forum’s law? Does the answer to this question vary depending on whether the court’s authority is based on admiralty, federal question, or diversity jurisdiction? And, if the threshold dispute centers on the validity and enforceability of choice-of-law and forum selection clauses, why should another forum’s law govern these questions? Continue reading "Enquiring Minds Want to Know: What Law Governs Forum Selection Clauses?"