Opinion ID: 794873
Heading Depth: 3
Heading Rank: 3

Heading: Whether the Forum Selection Clause is Unreasonable or Unjust

Text: 21 Lastly, the case law provides that an otherwise valid forum selection clause cannot be upheld if it is unreasonable or unjust. Info. Leasing Corp., 784 N.E.2d at 1196 (citations omitted). Under this step of the analysis, courts are to determine whether the chosen forum is so inconvenient as to, in effect, afford no remedy at all, thus `depriving litigants of their day in court.' Id. (citations omitted). A finding of unreasonableness or injustice must be based on more than mere inconvenience to the party seeking to avoid the requirements of the forum selection clause. Id. It must instead appear that enforcement in Ohio would be `manifestly and gravely inconvenient' to the party seeking to avoid enforcement such that it will `effectively be deprived of a meaningful day in court.' Id. (quoting Bremen, 407 U.S. at 19, 92 S.Ct. 1907). 22 The Ohio Eighth District Court of Appeals addressed a similar issue in the unreported case, Copelco Capital v. St. Marks Presbyterian Church, No. 77633, 2001 WL 106328 (Ohio Ct.App.2001). The defendants in Copelco were St. Marks Presbyterian Church and its pastor, Reverend Joan Campbell. The defendants had entered into an equipment lease contract with Cleveland-based American Financial Resources, who assigned the contract to the plaintiff, Copelco Capital, a New Jersey company, on the same day that it was entered into. Id. at . The defendants defaulted on the lease agreement, which included a forum selection clause that did not identify a particular jurisdiction but merely indicated that disputes over the contract, if assigned, would be interpreted construed and enforced in accordance with the laws and public policies of the State of incorporation of the assignee, and that the defendant consents to personal jurisdiction and venue in either the United States District Court or appropriate State court in the state of assignee's corporate headquarters. Id. 23 The plaintiff filed suit in New Jersey state court, and ultimately obtained a foreign judgment against the defendants. Id. The defendants then filed a motion for relief pursuant to Civ. R. 60(B) in Ohio state court, seeking relief from judgment, which was denied by the trial court. Id. at . On appeal, the Copelco court vacated the trial court judgment and refused to uphold the forum selection clause, finding that the clause was invalid because the defendants were not sophisticated commercial entities engaged in business for profit, but rather [were] a local church and its reverend. Id. at . In so holding, the Copelco court recognized that assignees, pursuant to their contracts with assignors, are vested with the rights and remedies available to the assignor, but found that under the particular circumstances of that case, enforcement of the forum selection clause would be unreasonable. Id. (distinguishing Kennecorp on the grounds that the forum selection clause at issue failed to specify the jurisdiction of a particular court; and because defendants would not expect to be hauled into court in New Jersey since both it and the assignor were based in Ohio). 24 While the court's reasoning in Copelco is persuasive, we are of the opinion that the situation in Copelco is easily distinguishable from the present circumstances, and that the district court improperly relied upon Copelco in holding the forum selection clause invalid. Copelco does not control here because this case involves two commercial entities involved in for-profit businesses. Unlike the defendant in Copelco, this Defendant is not an unsophisticated church and its reverend. Rather, Defendant is a business organization that contracted to receive services from another business organization. The contract clearly stated that assignment was a possibility, and that in the event of assignment, any disputes would be governed by the laws of the state of incorporation of the assignee. Even the Copelco court recognized that under different circumstances, assignees are vested with the same rights and remedies that are available to the assignor. Id. at . Assignees like Plaintiff have the right to the benefit of their bargain unless it would be unreasonable or unjust to enforce the terms of the agreement, and we do not believe that it would be so here. 25 Defendant is a commercial entity, and should have realized the implications of agreeing to the inclusion of a forum selection clause that did not identify an assignee or specified jurisdiction. Having failed to object to the terms of the forum selection clause, Defendant now claims that it is disadvantageous for it to have to litigate this case in Ohio. While Defendant may be dissatisfied with the litigation forum, it is not our task to save Defendant from the consequences of an agreement it freely entered into. 26 We also do not agree with the contention of the district court and Defendant that Defendant had no notice that it could face litigation in Ohio. Not only did Defendant expressly agree to submit to jurisdiction anywhere in the country, including Ohio, Defendant was also given written notice of the assignments on May 11, 2004, the day after the agreements were executed. The letters providing notice identified Plaintiff as the assignee and listed Plaintiff's business address as Brecksville, Ohio. Given the terms of the forum selection clause in the agreements that Defendant signed, Defendant was indeed on notice practically from the inception of the agreements that any disputes would be litigated in Ohio, where the offices of Plaintiff-assignee are located. 27 Although a forum selection clause is not always voidable or unenforceable simply on grounds of inconvenience, the argument of lack of convenience in the instant case strains credulity. It is difficult to comprehend Defendant's contention that the distance between Ohio and Pennsylvania would deprive Defendant of its day in court. Ohio and Pennsylvania are neighboring states, and while Defendant may have to travel a few hours, it cannot be said to be manifestly and gravely inconvenient for Defendant to have to defend this case in Ohio. 28 Having found no evidence that enforcement of the forum selection clause would be unreasonable or unjust, we hold that the forum selection clause is valid and enforceable.