TBF Financial, LLC v. Compass Systems & Programming, Inc. & a.

THE STATE OF NEW HAMPSHIRE

SUPREME COURT

In Case No. 2017-0454, TBF Financial, LLC v. Compass
Systems & Programming, Inc. & a., the court on February 12,
2018, issued the following order:

Having considered the brief of the defendants, Compass Systems &
Programming, Inc. (Compass) and its president, Robert W. Bigos, the
memorandum of law filed by the plaintiff, TBF Financial, LLC. (TBF), and the
record submitted on appeal, we conclude that oral argument is unnecessary in
this case. See Sup. Ct. R. 18(1). The defendants appeal orders of the Superior
Court (Anderson, J.) declining to dismiss TBF’s breach of contract action. We
affirm.

The defendants contend that dismissal was required by the contract’s
forum selection clause. According to the defendants, the contract’s forum
selection clause vests Utah state and federal courts with exclusive jurisdiction
to decide any controversy between the parties about the contract. The trial
court disagreed with the defendants, ruling that the clause “contains a choice
of law provision and a consent to jurisdiction provision,” but that “[i]t does not
require that all claims be brought in Utah.”

On appeal, the defendants argue that the trial court misconstrued the
forum selection clause. We review the trial court’s interpretation of the forum
selection clause de novo. See Strafford Technology v. Camcar Div. of Textron,
147 N.H. 174, 175 (2001). We read the clause as a whole and give its terms
their reasonable meaning. See id. “Such clauses, however, are subject to
rigorous rules of interpretation and will not be enforced if deemed unjust or
unreasonable.” Id. at 176.

“New Hampshire has, by statute, sanctioned the enforcement of forum
selection clauses.” Id.; see RSA ch. 508-A (2010) (Uniform Model Choice of
Forum Act). Under RSA 508-A:3, “[i]f the parties have agreed in writing that an
action on a controversy shall be brought only in another state, and it is
brought in a court of this state, the court will dismiss or stay the action, as
appropriate,” unless certain enumerated exceptions apply. The defendants
acknowledge that none of the enumerated exceptions apply.

“The purpose of RSA 508-A:3 is to enforce forum selection clauses that
are bargained for by contracting parties, provided that [such clauses] confer
exclusive jurisdiction.” Strafford Technology, 147 N.H. at 177. “Beyond
mandating exclusivity, the statute does not dictate the precise wording
necessary for forum selection clauses to withstand judicial scrutiny,” and does
not require “specific magic words.” Id. (quotation omitted). Rather, “[t]he
statute mandates that enforceable forum selection clauses identify and make
exclusive whatever jurisdiction is selected to resolve disputes.” Id. “If a
reasonable and fair reading of such a clause would not confer exclusive
jurisdiction, it will not be enforced.” Id.

Thus, the issue before us is whether “a reasonable and fair reading” of
the forum selection clause in this case vests Utah state and federal courts with
exclusive jurisdiction. The forum selection clause provides, in pertinent part:

[T]his Agreement shall be governed by, and construed in
accordance with, the internal laws of the State of Utah without
regard to internal principles of conflict of laws. [Compass] hereby
submits to the jurisdiction of any Utah state or federal court sitting
in Salt Lake County, Utah, at [TBF’s] choice. [Compass] hereby
waives any claim that an action is brought in an inconvenient
forum, that the venue of the action is improper, or that this
Agreement or the transactions of which this Agreement is a party
may not be enforced in or by any of the above-named courts.

The plain language of this clause does not confer exclusive jurisdiction upon
Utah courts. Nothing in the clause requires TBF to bring an enforcement
action in a Utah court. Indeed, the clause provides that TBF may do so at its
option. Moreover, the clause lacks words of exclusivity. It “constitute[s]
nothing more than a consent to jurisdiction and venue in the named forum and
do[es] not exclude jurisdiction or venue in other forums.” Shoppes L.P. v.
Conn, 829 So. 2d 356, 358 (Fla. Dist. Ct. App. 2002). Accordingly, pursuant to
RSA 508-A:3, the parties’ forum selection clause is not enforceable. The
defendants cite no Utah authority inconsistent with this analysis. Thus, the
trial court did not err when it declined to dismiss TBF’s enforcement action.

Affirmed.

Dalianis, C.J., and Hicks, Lynn, Bassett, and Hantz Marconi, JJ.,
concurred.

Eileen Fox,
Clerk

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