Court Opinion

ID: 3132170
Source: CourtListenerOpinion
Date Created: 2015-10-17 00:43:46.391643+00
Date Added: 2024-06-11T12:26:57.746577
License: Public Domain

Note: Decisions of a three-justice panel are not to be considered as precedent before any tribunal.

                                           ENTRY ORDER

                           SUPREME COURT DOCKET NO. 2011-261

                                       JANUARY TERM, 2012

 Kaser USA, LLC                                        }    APPEALED FROM:
                                                       }
                                                       }    Superior Court, Orange Unit
    v.                                                 }    Civil Division
                                                       }
 Seabreeze Trading Corp.                               }    DOCKET NO. 204-9-09 Oecv

                                                            Trial Judge: Harold E. Eaton, Jr.

                          In the above-entitled cause, the Clerk will enter:

        Plaintiff Kaser USA, LLC appeals from an order of the superior court, civil division,
granting defendant Seabreeze Trading Corporation’s motion to dismiss for lack of jurisdiction.
Kaser contends the court erred in declining to enforce a contractual choice-of-forum clause that
allegedly designated Vermont as the non-exclusive forum for the resolution of disputes arising
out of the agreement. We affirm.

       The underlying facts are undisputed. In July 2007, plaintiff’s predecessor-in-interest
Kaser North America (Kaser NA) entered into an agency agreement with defendant Seabreeze
which authorized Seabreeze to sell Kaser’s products in parts of western Canada and the United
States. Kaser NA was a New Hampshire corporation with its principal place of business in
Bradford, Vermont. Seabreeze is a Canadian corporation based in Armstrong, British Columbia.
The agreement referred to Kaser NA as the “principal” and Seabreeze as the “agent,” and
contained a choice-of-forum clause in which the parties agreed “that the courts of the Principal’s
place of business shall have non-exclusive jurisdiction to settle any dispute arising out this
Agreement insofar as this is permitted by law.”

        Kaser NA was later dissolved and all of its existing contracts were transferred by
agreement to Kaser USA, LLC, a Delaware limited liability company with its principal place of
business in Connecticut. In August 2009, Kaser USA filed this action in the superior court,
alleging that Seabreeze had breached the agency agreement by failing to deliver a contract and
purchase order totaling $28,000 which Seabreeze had entered into on Kaser’s behalf.

        Seabreeze moved to dismiss for lack of jurisdiction, asserting that Kaser USA had
succeeded as the principal under the contract, that the courts of Connecticut therefore had
jurisdiction under the terms of the choice-of-forum clause, and that vesting jurisdiction in
Vermont would be unreasonable due to the absence of any significant connection by either party
with Vermont.

        The court issued a written decision in May 2011. The court agreed that the principal’s
identity and place of business had changed and that by its plain terms the choice-of-forum clause
no longer referred to Vermont or vested jurisdiction in its courts. The court also agreed that, in
light of the change of ownership, enforcing the clause to vest jurisdiction in Vermont would be
unreasonable. Citing this Court’s decision in Chase Commercial Corp. v. Barton, 153 Vt. 457
(1990), the court explained: “[E]ven if the clause did refer to Vermont, the court would conclude
that it is unreasonable to conduct the litigation here. . . . Any connection between this litigation
and this state ceased when Kaser NA was administratively dissolved and its interests were
assigned to another company. There is simply no reason why Vermont courts should remain
involved with this litigation any longer.” Accordingly, the court granted the motion to dismiss,
and denied a subsequent motion to reconsider. This appeal followed.

        Kaser USA contends the trial court misinterpreted the choice-of-forum clause, asserting
that the parties’ intent was to vest jurisdiction specifically in Vermont rather than generically in
the “place of the business” of the principal or its successor. We need not resolve this claim,
however, because we agree with the trial court’s alternative ruling that enforcement of the
choice-of-forum clause would be unreasonable in these circumstances. As we observed in
Barton, “[e]nforcement of a forum clause is not automatic, and courts may disregard such clauses
if enforcement would be unreasonable.” 153 Vt. at 459. There, the parties had entered into a
commercial agreement containing a choice-of-forum clause designating the courts of New
Jersey, the home state of the original lessor, Thermasol. Thermasol later sold the leases to
Chase, however, which subsequently filed an action in Vermont against the defendant lessees for
nonpayment. The defendants moved to enforce the choice-of-forum clause and dismiss for lack
of jurisdiction. The trial court denied the motion, and we affirmed, noting the absence in the
case of any ties to or interests in New Jersey following the sale of the company. Id. at 459-60.

        This case is similar. As the trial court found, “any connection between this litigation and
this state ceased when Kaser NA was administratively dissolved and its interests were assigned
to another company” based elsewhere. Under these circumstances, Vermont has become
essentially alien to this dispute—all connections that may have existed when the agreement was
negotiated having been extinguished through unanticipated changes. See The Bremen v. Zapata
Off-Shore Co., 407 U.S. 1, 16-17 (1972) (explaining that mere inconvenience would not render
choice-of-forum clause unenforceable when parties “contemplated the claimed inconvenience”
while distinguishing the “serious inconvenience” where clause vests jurisdiction “in a remote
alien forum”). Accordingly, we discern no basis to disturb the trial court’s judgment to dismiss
for lack of jurisdiction.*

       Affirmed.

                                                  BY THE COURT:

                                                  _______________________________________
                                                  John A. Dooley, Associate Justice

                                                  _______________________________________
                                                  Brian L. Burgess, Associate Justice

                                                  _______________________________________
                                                  Beth Robinson, Associate Justice

       *
            We note Kaser USA’s claim that, due to the passage of time, dismissal may jeopardize
its right, under the contract, to sue elsewhere, but that implicates issues of contract interpretation,
estoppel, and the like and does not alter our conclusion concerning enforcement of the choice-of-
forum clause.
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