Filed 1/26/24 The Rushing Co. v. Caydon San Diego Property CA4/1

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COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

THE RUSHING COMPANY, LLC,

Plaintiff and Appellant,

v.

CAYDON SAN DIEGO PROPERTY, 

LLC,

Defendant and Respondent.

 D081489

 (Super. Ct. No. 37-2022-

 00030947-CU-BC-CTL)

APPEAL from an order of the Superior Court of San Diego County, 

Matthew C. Braner, Judge. Reversed and remanded.

CGS3, Gregory S. Markow and Salvatore Padula for Plaintiff and 

Appellant.

Glaser Weil Fink Howard Jordan & Shapiro, Elizabeth A. Sperling and 

Alaina Bird for Defendant and Respondent.
2

Claiming that defendant Caydon San Diego Property, LLC (Caydon) 

failed to pay for contracted engineering and design services on a land 

development project, plaintiff The Rushing Company, LLC (Rushing) filed a 

complaint seeking to foreclose on a previously recorded mechanics lien. 

Caydon filed a motion to dismiss or stay the action, arguing that the 

agreement attached to Rushing’s complaint included a mandatory forum 

selection clause requiring the parties to litigate any dispute in Harris 

County, Texas. The trial court agreed, noting that Rushing failed to present 

evidence that the Harris County, Texas courts would be unable to fairly 

decide the dispute. After ordering a temporary stay to give Rushing an 

opportunity to re-file its action in Texas, the trial court dismissed the action.

The central issue in this appeal is the enforceability of the forum

selection clause. We interpret the forum selection clause as permissive, 

which triggers a traditional forum non conveniens analysis. Caydon, as the 

moving party, failed to carry its burden to show the suitability of the 

alternative forum, and we independently conclude the Texas courts are not a 

suitable forum in this case. Texas courts are unable to exercise the requisite 

in rem jurisdiction over the property subject to the mechanics lien, and 

Rushing’s mechanics lien foreclosure cause of action would be time-barred if 

re-filed in Texas.

Accordingly, we reverse the trial court’s order and remand this matter 

to the San Diego Superior Court as the appropriate forum for resolving this 

litigation.

FACTUAL AND PROCEDURAL BACKGROUND

In May 2022, after Caydon allegedly failed to pay for engineering and 

design work performed on the California Theater Project (Project) in 
3

downtown San Diego, Rushing recorded a mechanics lien on the property in 

the amount of $195,638.40. Less than three months later, Rushing filed a 

complaint against Caydon asserting causes of action for breach of oral 

contract, foreclosure of mechanics lien, and quantum meruit.1 Attached to 

the complaint were copies of an unsigned draft agreement (Agreement) 

purporting to confirm the terms and conditions of the parties’ oral agreement 

and the recorded mechanics lien.

Caydon demurred to the complaint and concurrently filed a motion to 

dismiss, or, in the alternative, stay the action pursuant to Code of Civil 

Procedure section 410.30, subdivision (a).2 Caydon’s demurrer was based, in 

part, on the argument that Rushing lacked standing to bring any claim based 

on the Agreement because neither party to the litigation is a named party to 

the contract.3 In its motion to dismiss, Caydon argued that to the extent 

Rushing had standing to sue, it was required to initiate its action in a Harris 

County, Texas court based on the Agreement’s forum selection clause.

1 The complaint contained in the record on appeal bears an August 4, 

2022 file-stamp, but it was initially e-filed on August 2, 2022, and was 

subsequently “deemed filed” by the trial court on August 2, 2022.

2 All further statutory references are to the Code of Civil Procedure 

unless otherwise indicated. Section 410.30, subdivision (a) states: “When a 

court upon motion of a party or its own motion finds that in the interest of 

substantial justice an action should be heard in a forum outside this state, 

the court shall stay or dismiss the action in whole or in part on any conditions 

that may be just.”

3 The draft agreement attached to Rushing’s complaint is “by and 

between Caydon USA San Diego LLC . . . and Rushing, Inc.” while the parties 

in the underlying action are named “The Rushing Company, LLC” and 

“Caydon San Diego Property, LLC.”
4

After taking the matter under submission, the trial court granted the 

motion to stay or dismiss and overruled the demurrer as moot. The 

December 16, 2022 minute order stated in part: “The court will stay this case 

in its entirety once Plaintiff has refiled its case in a state or federal court 

sitting in Harris County, Texas. . . . If Plaintiff has not refiled its case by 

[January 27, 2023], the court will dismiss the case.”4 Rushing filed an appeal 

from the stay order.5 (See § 904.1, subd. (a)(3).)

4 The trial court did not rule on Caydon’s request for judicial notice filed 

in support of its demurrer. Caydon seeks to renew part of that request on 

appeal, seeking judicial notice of Rushing invoices purportedly relevant to the 

demurrer that was overruled as moot. Although an appellate court may 

consider matters that are properly the subject of judicial notice (Evid. Code, 

§ 459), the invoices and their contents are not judicially noticeable “[f]acts 

and propositions that are not reasonably subject to dispute and are capable of 

immediate and accurate determination by resort to sources of reasonably 

indisputable accuracy.” (Id., § 452, subd. (h); see also Joslin v. H.A.S. Ins. 

Brokerage (1986) 184 Cal.App.3d 369, 374-375 [“Taking judicial notice of a 

document is not the same as accepting the truth of its contents or accepting a 

particular interpretation of its meaning. [Citation.]]”.) We likewise decline 

to accept and consider as unnecessary its reply brief in support of judicial 

notice.

5 For reasons that are not clear from the record, on January 27, 2023, 

several weeks after the notice of appeal was filed, a different judge purported 

to stay the case pending appeal and then dismissed it without prejudice. 

Suffice it to say, the court had no jurisdiction to dismiss the case while the 

appeal was pending. (§ 916, subd. (a); Varian Medical Systems, Inc. v. 

Delfino (2005) 35 Cal.4th 180, 189 [“The purpose of the automatic stay 

provision of section 916, subdivision (a) ‘is to protect the appellate court’s 

jurisdiction by preserving the status quo until the appeal is decided. The 

[automatic stay] prevents the trial court from rendering an appeal futile by 

altering the appealed judgment or order by conducting other proceedings that 

may affect it.’ [Citation.]]”.)
5

DISCUSSION

Contracting parties often include choice of law, venue, and forum 

selection clauses in their written agreements to predetermine how and where 

potential future disputes will be resolved. According to Rushing, the parties 

entered into an oral agreement whose terms and conditions were confirmed 

by the unsigned draft Agreement. Caydon’s demurrer disputed the existence 

of any contract between the parties. But for purposes of its concurrently filed 

motion to stay or dismiss, Caydon assumed Rushing’s premise that if the 

parties had an oral agreement, the unsigned written Agreement reflected its 

terms.6

The Agreement states in section 13.15:

Law to Apply/Venue. This Agreement shall be construed 

under and in accordance with the laws of the United States 

and laws of the state where the Project is located. 

Notwithstanding the foregoing, the Parties agree that 

venue for any dispute under this Agreement shall lie in the 

state courts or federal courts sitting in Harris County, 

Texas.

In this appeal, the parties vigorously dispute the scope and effect of 

section 13.15. Caydon asserts that the provision constitutes a mandatory 

forum selection clause and was properly enforced by the trial court to 

preclude litigating the dispute in San Diego. Rushing makes several contrary 

arguments. First, it maintains that the section is limited to venue selection. 

Second, it contends the trial court erred by interpreting the language as 

6 We limit the substance of our decision to reviewing the December 16 

order granting Caydon’s motion to stay or dismiss the action on the basis of 

an incorrect forum. Because that same order also overruled Caydon’s 

demurrer to the complaint as moot without addressing the merits, we will 

reverse the order in its entirety with directions to recalendar the demurrer.
6

mandatory. Finally, even if the clause were mandatory, Rushing argues that 

it should not be enforced.7

A. Section 13.15 Encompasses Both Venue and Forum Selection

The parties presented no extrinsic evidence concerning the meaning of 

the Agreement, so we independently interpret its language. As the court 

explained in Intershop Communications AG v. Superior Court (2002) 

104 Cal.App.4th 191, 196 (Intershop), “An appellate court is not bound by the 

trial court’s construction of a contract when, as here, the interpretation is 

based solely upon the terms of the written instrument without any 

assessment of conflicting extrinsic evidence.” (See also Bushansky v. SoonShiong (2018) 23 Cal.App.5th 1000, 1006 (Bushansky) [interpretation of a 

forum selection clause is a legal question subject to de novo review]; accord, 

Animal Film, LLC v. D.E.J. Productions, Inc. (2011) 193 Cal.App.4th 466, 

471 (Animal Film) [“When, as here, no conflicting extrinsic evidence has been 

presented, the interpretation of a forum selection clause is a legal question 

that we review de novo.”].)

A venue selection clause is “purely an intrastate issue involving the 

selection of a county in which to hold the trial.” (Alexander v. Superior Court

7 When granting Caydon’s motion to dismiss, the trial court apparently 

assumed, without deciding, the existence of the Agreement between the 

parties. (See Brown v. USA Taekwondo (2021) 11 Cal.5th 204, 209 [at the 

demurrer stage, the truth of the allegations in the complaint are assumed]; 

see also Lu v. Dryclean-U.S.A. of California, Inc. (1992) 11 Cal.App.4th 1490, 

1494 [an unsigned agreement does not necessarily render a forum selection 

clause unenforceable].) We express no opinion on whether the Agreement is 

valid and enforceable, and if so, on what terms. (See Vita Planning & 

Landscape Architecture, Inc. v. HKS Architects, Inc. (2015) 240 Cal.App.4th

763, 764 [it is for the trier of fact to determine whether the contract did in 

fact exist where “ ‘ “ ‘the evidence is conflicting or admits of more than one 

inference’ ” ’ ”].)
7

(2003) 114 Cal.App.4th 723, 727.) A forum selection clause, by contrast, 

reflects the parties’ choice of a court from among different states or a place of 

jurisdiction. (Ibid.) Under the circumstances of this case, the relevant clause 

in the Agreement does both. By referencing solely “the state courts or federal 

courts sitting in Harris County, Texas,” the Agreement specifies both a forum 

(Texas) and a specific venue (Harris County).8 We therefore reject Rushing’s 

contention that it is limited to designating venue.

B. The Forum Selection Clause Is Permissive

The mere presence of a forum selection clause in an agreement does not 

automatically prevent a different court from exercising jurisdiction. (See 

M/S Bremen v. Zapata Off-Shore Co. (1972) 407 U.S. 1, 12.) And the extent 

to which it does often depends on whether the clause is characterized as 

“mandatory” or “permissive.” (Intershop, supra, 104 Cal.App.4th at p. 196.) 

If the clause is mandatory, it “will ordinarily be given effect without any 

analysis of convenience,” the only question being “whether enforcement of the 

clause would be unreasonable.” (Ibid.) “On the other hand, when the clause 

merely provides for submission to jurisdiction and does not expressly mandate 

litigation exclusively in a particular forum, then the traditional forum non 

8 Under different circumstances, a clause might be properly interpreted 

as specifying the specific venue within a court’s territorial jurisdiction only if 

that court could properly exercise personal jurisdiction over the defendant. 

This was the situation in Global Packaging, Inc. v. Superior Court (2011) 

196 Cal.App.4th 1623, where the parties’ agreement provided for venue 

alternatively in either (a) the California county where the seller was located, 

or (b) the location where the product was being used. (Id. at p. 1627.) 

Understandably, the court concluded that this language did not reasonably 

indicate the buyer was agreeing to jurisdiction in California that was not 

otherwise constitutional. (Id. at p. 1634.)
8

conveniens analysis applies.” (Ibid., italics added; accord, Verdugo v. 

Alliantgroup, L.P. (2015) 237 Cal.App.4th 141, 147, fn. 2 (Verdugo).)

Here, the trial court interpreted section 13.15 as mandatory. And on 

appeal, Caydon relies on three cases to defend that ruling. Caydon’s 

imprecise comparisons are unavailing, and we find the forum selection 

language in all three cases materially distinguishable.

In Docksider, Ltd. v. Sea Technology, Ltd. (9th Cir. 1989) 875 F.2d 762, 

764, the relevant clause includes language indicating the parties’ intent to 

exclusively litigate in Virginia—“ ‘venue of any action brought hereunder 

shall be deemed to be in . . . Virginia.’ ” (Italics added.) Similarly, the clause 

in CQL Original Products, Inc. v. National Hockey League Players’ Assn. 

(1995) 39 Cal.App.4th 1347, 1352, 1358 expressly references the parties’ 

agreement to defer to one party’s “election” and includes language indicating 

its mandatory nature—“ ‘any claims arising hereunder shall, at the 

Licensor’s election, be prosecuted in the appropriate court of Ontario.’ ” 

(Italics added.) Section 13.15 contains no such similar language. Finally, in 

Intershop, the court construed the applicable language—“ ‘[t]o the extent 

permitted by the applicable laws the parties elect Hamburg to be the place of 

jurisdiction’ ”—as indicating the parties’ agreement that Hamburg, Germany 

would be the only forum, and the record in that case contained undisputed 

evidence that the forum selection clause would be mandatory under German 

law. (Intershop, supra, 104 Cal.App.4th at p. 196, italics added.) Unlike the 

clause in Intershop, section 13.15 does not reflect any “election” by these 

parties to make the Texas courts in Harris County as the exclusive forum as 

long as it is permissible under Texas law.

Other forum selection clauses construed to be mandatory include some 

type of language indicating the exclusivity of a particular forum. (See, e.g., 
9

Smith, Valentino & Smith, Inc. v. Superior Court (1976) 17 Cal.3d 491, 494 

[plaintiff agreed to bring all actions arising out of agency agreement only in 

Philadelphia]; Bushansky, supra, 23 Cal.App.5th at p. 1011 [“ ‘to the fullest 

extent permitted by law, the Court of Chancery of the State of Delaware . . .

shall be the sole and exclusive forum . . . for any derivative action’ ” (original 

italics)]; Verdugo, supra, 237 Cal.App.4th at p. 146 [“ ‘The parties agree that 

proper subject matter and personal jurisdiction shall be had solely in [the] 

State of Texas. The sole venue for disputes arising hereunder shall be in 

Harris County, Texas.’ ” (Italics added.)]; Cal-State Business Products & 

Services, Inc. v. Ricoh (1993) 12 Cal.App.4th 1666, 1672, fn. 4 [“ ‘[A]ny 

appropriate state or federal district court located in the Borough of 

Manhattan, New York City, New York shall have exclusive jurisdiction over 

any case of controversy arising under or in connection with this Agreement.’ ”

(Italics added.)].) Unlike the contract language in all these cases, section 

13.15 contains no such exclusivity language and more closely resembles

“forum selection clauses that courts have held to be permissive because they 

provide for submission to jurisdiction in a particular forum without

mandating it.” (See, e.g., Animal Film, supra, 193 Cal.App.4th at pp. 471-

472; cf. id. at p. 470 [“the parties hereto submit and consent to the 

jurisdiction of the courts present in the state of Texas in any action brought 

to enforce (or otherwise relating to) this agreement” (boldface & 

capitalization omitted)]; Berg v. MTC Electronics Technologies Co. (1998)

61 Cal.App.4th 349, 357 [“ ‘[t]he company [MTC] has expressly submitted to 

the jurisdiction of the State of California and United States Federal courts 

sitting in the City of Los Angeles, California, for the purpose of any suit, 

action or proceedings arising out of this Offering’ ”]; Hunt Wesson Foods, Inc. 

v. Supreme Oil Co. (9th Cir. 1987) 817 F.2d 75, 76-77 [“[t]he courts of 
10

California, County of Orange, shall have jurisdiction over the parties in any 

action at law relating to the subject matter or the interpretation of this 

contract”].)

We independently interpret the language—“venue for any dispute . . .

shall lie in the state courts or federal courts sitting in Harris County, 

Texas”—as permissive.9 The language reflects the parties’ agreement to 

submit to the jurisdiction of the Harris County, Texas courts, but does not 

unequivocally require that litigation proceed exclusively in those courts.

C. Texas Courts Are Not a Suitable Alternative Forum

Having determined the forum selection clause is permissive, we apply a 

traditional forum non conveniens analysis. The first step in this analysis is 

to determine whether the Texas courts constitute a “suitable” alternative 

forum.

Caydon, as the moving party, bore the burden to show the availability 

of a suitable alternative forum. (Stangvik v. Shiley, Inc. (1991) 54 Cal.3d 

744, 751 [“On a motion for forum non conveniens, the defendant, as the 

moving party, bears the burden of proof.”].) Rather than assume this 

9 In light of our conclusion, it is unnecessary for us to decide whether 

section 13.15 could be enforced had we determined it was a mandatory forum 

selection clause. We note, however, that even with respect to a mandatory 

clause, the party seeking to enforce the clause “has the burden to show 

enforcement would not diminish unwaivable California statutory rights . . . .” 

(Verdugo, supra, 237 Cal.App.4th at pp. 144-145.) Here, California’s 

statutory mechanics lien rights are rooted in the California Constitution (art. 

XIV, § 3) and cannot be waived absent a written statement reflecting full 

payment of the claim. (See Civ. Code, § 8124; accord, Wm. R. Clarke Corp. v. 

Safeco Ins. Co. (1997) 15 Cal.4th 882, 889 [“[U]nder our mechanic’s lien law, 

waiver and release of [payment bond] rights is permitted only in conjunction 

with payment, or a promise of payment, and a conditional release is effective 

only if the claimant is actually paid.”].)
11

obligation, Caydon attempted to shift the burden to Rushing to show the 

Texas courts were unavailable or unable to accomplish substantial justice. 

Caydon argued, “Appellant provided no evidence establishing that courts in 

Harris County, Texas were unavailable or unable to accomplish substantial 

justice in this straightforward breach of contract action.” After concluding 

the forum selection clause was mandatory, the trial court bypassed the 

traditional forum non conveniens analysis and erroneously placed the burden 

on Rushing to establish that enforcement of the forum selection clause was 

unreasonable.

We independently conclude the Texas courts are not a suitable 

alternative forum in this case. (See Animal Film, supra, 193 Cal.App.4th at 

p. 472 [“The existence of a suitable alternative forum is a legal question that 

we review independently.”].) “A forum is suitable if there is jurisdiction and 

no statute of limitations bar to hearing the case on the merits. [Citation.]” 

(Chong v. Superior Court (1997) 58 Cal.App.4th 1032, 1036-1037.) Texas fails 

on both counts.

First, the Texas courts lack the power to resolve Rushing’s mechanics 

lien foreclosure action. (See Haga v. Thomas (Tex.Ct.App. 2013) 409 S.W.3d 

731, 737 [“ ‘It is the settled law of this State, as well as the law generally, 

that the title to real property is exclusively subject to the government within 

whose territory it is situated.’ ”]; Miller v. Miller (Tex.Ct.App. 1986) 

715 S.W.2d 786, 788 [“[t]he courts of [Texas] are without power or jurisdiction 

to adjudicate title to land in another state.”]; see also Central Bank v. 

Superior Court (1973) 30 Cal.App.3d 913, 917 [“An action to foreclose a 

mechanics’ lien, like a mortgage foreclosure, is an in rem action and is local in 

nature; the plaintiff is resorting primarily to the security for the payment of 
12

the indebtedness”]; Hardy v. Hardy (1958) 164 Cal.App.2d 77, 79 [“a court of 

one state cannot directly affect title to land in another”].)

Second, if Rushing were to re-file in Texas, its mechanics lien 

foreclosure action would be statutorily time-barred. (Civ. Code, § 8460, 

subd. (a) [“The claimant shall commence an action to enforce a lien within 

90 days after recordation of the claim of lien. If the claimant does not 

commence an action to enforce the lien within that time, the claim of lien 

expires and is unenforceable.”].) Although Caydon acknowledges the 

Agreement calls for the application of California law, it fails to offer any legal 

authority or explanation that would allow Rushing’s foreclosure action to 

proceed in Texas notwithstanding the strict statutory time limitation.

Unless a suitable alternative forum is available, an action is not subject 

to dismissal. (Judicial Council of Cal., com., reprinted at 14A West’s Ann. 

Code Civ. Proc. (2022 ed.) foll. § 410.30, p. 450 [“[T]he suit will be 

entertained, no matter how inappropriate the forum may be, if the defendant 

cannot be subjected to jurisdiction in other states. The same will be true if 

the plaintiff’s cause of action would elsewhere be barred by the statute of 

limitations . . . .”].) Our conclusion on this threshold inquiry requires 

reversal of the trial court’s order.

Having determined the Texas courts are not a suitable alternative 

forum, we need not proceed with the next step in the traditional forum non 

conveniens analysis—balancing the private and public interest factors. (See 

Animal Film, supra, 193 Cal.App.4th at p. 472 [“If the court finds that a 

suitable alternative forum exists, it must then balance the private interests 

of the litigants and the interests of the public in retaining the action in 

California.”] (Italics added.).)
13

DISPOSITION

The December 16, 2022 order is reversed, and this matter is remanded

to the trial court to lift the stay, vacate the dismissal, and conduct further 

proceedings consistent with this opinion, including recalendaring Caydon’s 

demurrer that was previously overruled as moot. Rushing is entitled to 

recover its costs on appeal. (See Cal. Rules of Court, rule 8.278(a)(1).)

DATO, Acting P. J.

WE CONCUR:

DO, J.

CASTILLO, J.