Court Opinion

ID: 9584038
Source: CourtListenerOpinion
Date Created: 2023-08-21 22:44:02.593992+00
Date Added: 2024-06-11T15:05:39.130433
License: Public Domain

Taylor, J.
(dissenting). I respectfully dissent. The trial court’s order denying defendants’ motion to change venue from Oakland County to Saginaw County on the basis of the parties’ agreement was proper. Neither the venue statutes nor the court rules prohibit courts from giving effect to the intent of the parties as expressed in the contract with regard to the choice of a particular venue. The preferable approach would be to enforce the forum selection clause in the contract unless a party could show that such enforcement would be unreasonable or that the provision was the product of fraud or overreaching. Such an approach embraces the modem view of forum selection clauses as set forth in the Restatement Conflict of Laws, 2d, § 80, p 244 (1988), and achieves the proper balance between the parties’ *411interest in having their disputes resolved in a mutually agreeable forum and the state’s interest in ensuring fairness in the plaintiff’s selection of a venue.
The majority reasons that because contractual forum selection clauses designating a particular venue are not expressly permitted by the Legislature, such clauses must of necessity be prohibited. This reverses the proper order of things. The rule is that citizens can contract with respect to particular things unless the Legislature determines that contracts regarding such matters are contrary to public policy. The Legislature has not forbidden persons from agreeing to a specific venue for future disputes. The majority’s approach cannot be reconciled with the fundamental principle that individuals are free to contract as they see fit in the absence of a specific statutory or constitutional prohibition.1 Although the Legislature has seen fit to expressly permit individuals to contractually consent to personal jurisdiction, MCL 600.701(3); MSA 27A.701(3), MCL 600.711(2); MSA 27A.711(2), MCL 600.745; MSA 27A.745, it does not follow a fortiori from such express permission with regard to jurisdiction that contractual agreements with respect to venue are therefore not permitted. Had the Legislature intended to prohibit parties from contractually agreeing to venue in advance, it cer*412tainly could have done so, as demonstrated by the statutes cited by the majority limiting a plaintiffs choice of venue in probate and tort actions.2 The Legislature having imposed no such limitations with regard to venue provisions, we should conclude that there are none.
The majority contends that such agreements would abrogate a court’s authority with regard to venue under the court rules; however, that is not the case. The relevant question in a contract case is whether, under the circumstances, a court should exercise its authority with regard to venue to give effect to the legitimate expectations of the parties as manifested in their voluntary agreement regarding the particular court in which certain actions must be brought. See MCR 2.222(A) and 2.223(A)(2); The Bremen v Zapata Off-Shore Co, 407 US 1, 9, 12; 92 S Ct 1907; 32 L Ed 2d 513 (1972); Restatement, supra. There are compelling reasons why a freely negotiated agreement with respect to venue should be given full effect.3
As the majority notes, “the primary goal [of statutes and court rules establishing venue] is to minimize the costs of litigation not only by reducing the burdens on the parties, but also by considering the strains on the system as a whole.” Gross v General Motors Corp, 448 Mich 147, 155; 528 NW2d 707 (1995). Yet, the majority’s decision moves the law in just the opposite *413direction. It increases the costs of litigation and burdens on the parties, at least as the parties themselves saw the matter as reflected in their contract. The lease in this case expressly provided that the jurisdiction, choice of law, and venue provisions were specifically negotiated terms. Thus, it must be concluded that the parties took the venue provisions into account when determining the other terms of the lease. The reduced burden on plaintiff as a result of the parties’ agreement with regard to venue was presumably reflected in the amount of the lease payments. The majority has not only rewritten the express terms of the contract at issue, but has utterly failed to support its claim that the enforcement of forum selection clauses, such as the one at issue, will result in a strain on the judicial system. On the contrary, enforcing such provisions would encourage certainty in contracting and reduce the cost of litigation by enabling the parties to avoid venue disputes in advance. Thus, employing the modem view that supports enforcement of such provisions will further the goals of the Legislature and the courts by reducing the burden on the parties and the strains on the legal system.
As the majority correctly recognizes, statutes and court rules relating to venue are procedural in nature and are primarily concerned with the convenience of the litigants. MCR 2.222(A); Gross, supra at 155; Kerekes v Bowlds, 179 Mich App 805, 810; 446 NW2d 357 (1989); 77 Am Jur 2d, Venue, § 47, pp 654-655. “[V]enue is simply the location of trial, and its determination should only concern the selection of a fair and convenient location where the merits of a dispute can be adjudicated.” Gross, supra at 156. There is *414simply no reason why parties should not be able to stipulate in advance to the location of trial. Whatever inconvenience defendants would suffer as a result of being forced to litigate in Oakland County was clearly foreseeable at the time of contracting; both parties voluntarily decided that Oakland County would be an acceptable venue and, as discussed above, that decision formed an integral part of the contract. The majority offers no reasoning that would justify allowing defendants to avoid the consequences of their informed agreement. Although the majority fears that allowing such agreements might somehow “undermine the Legislature’s power,” it would do so no more than agreements with regard to jurisdiction. Furthermore, there is no reason to assume that the statutes cited by the majority that permit a party to consent contractually to personal jurisdiction were not also intended to permit a party to consent to personal jurisdiction with regard to a particular court within the state. MCL 600.745(2)(b); MSA 27A.745(2)(b) expressly directs courts to consider whether the forum chosen by the parties “is a reasonably convenient place for the trial of the action.”
Federal courts, employing the modem view of forum selection clauses, have not distinguished between contractual provisions designating a particular court and those specifying a particular jurisdiction. See The Bremen, supra (upholding a forum selection clause stating that disputes were to be resolved in the High Court of Justice in London, England), Carnival Cruise Lines, Inc v Shute, 499 US 585, 591-593; 111 S Ct 1522; 113 L Ed 2d 622 (1991) (applying the holding in The Bremen to uphold a forum selection clause stating that disputes were to *415be resolved in Florida courts), Milk ‘N’ More, Inc v Beavert, 963 F2d 1342 (CA 10, 1992) (applying the holding in The Bremen to uphold the portion of a forum selection clause stating that “venue shall be proper under this agreement in Johnson County, Kansas”), and Restatement Conflict of Laws, 2d, § 80, supra at 244 (discussing agreements concerning the place or court where the parties’ disputes shall be resolved). This rationale makes sense when one considers that forum selection clauses regarding jurisdiction and those designating a particular venue differ only in regard to the specificity with which the parties identify the chosen forum. In either case, the same considerations arise when determining the enforceability of the contractual provision, e.g., whether the agreement is reasonable or the result of fraud or overreaching. The Bremen, supra, 407 US 10, 15; Restatement, supra at 244. Indeed, these are the same factors that courts have been directed to take into account when assessing the enforceability of agreements regarding jurisdiction. MCL 600.745(2)(c); MSA 27A.745(2)(c). It is this approach that achieves the proper balance, giving the parties the maximum amount of contractual freedom while ensuring that the state’s interest in preserving fairness is respected. The majority’s result not only seriously encroaches on freedom of contract but, as has been discussed, is counterproductive because it deprives parties of a valuable tool in reducing the cost of litigation.
Moreover, there is no principled excuse for distinguishing between those agreements that are reached after a cause of action arises and those that are negotiated in advance pursuant to a contract. In Garavag-lia v Dep’t of Revenue, 338 Mich 467, 470; 61 NW2d *416612 (1953), our Supreme Court upheld an agreement regarding venue that was entered into before suit was filed but after the cause of action arose. If, as the majority argues, venue is controlled exclusively by statute and court rule and is fixed at the time suit is filed, the agreement in that case should have been held to be invalid, because according to statute venue was properly laid elsewhere. Id. at 470. The majority points to no authority or reasoning that would justify different treatment for forum selection clauses on the basis of whether the agreement was entered into before or after the cause of action arose.
In every case in which Michigan courts have considered the question, the broader federal view has been adopted. In Grand Trunk W R Co v Boyd, 321 Mich 693, 699-700; 33 NW2d 120 (1948), rev’d 338 US 263; 70 S Ct 26; 94 L Ed 55 (1949), our Supreme Court adopted the modem view with regard to forum selection clauses. However, consistent with the reasoning above, the decision was reversed by the United States Supreme Court because the Federal Employers Liability Act, 45 USC 56, expressly forbade such agreements as applied to claims under the act. 388 US 265-266. Similarly, this Court adopted the reasoning of Nat’l Equipment Rental, Inc v Szukhent, 375 US 311; 84 S Ct 411; 11 L Ed 2d 354 (1964), in Nat’l Equipment Rental, Inc v Miller, 73 Mich App 421, 426; 251 NW2d 611 (1977). The fact that the federal approach was followed in both these cases and in Garavaglia, supra, inescapably leads to the conclusion that the modem view of forum selection clauses should form the basis for today’s decision.
In my opinion, the trial court acted within its authority when it found that venue was proper in *417Oakland County on the basis of the parties’ freely negotiated agreement. For these reasons, I would affirm the trial court’s order denying defendants’ motion to change venue.

 See, e.g., Dep’t of Navy v Federal Labor Relations Authority, 295 US App DC 239, 248; 962 F2d 48 (1992) [cited with approval in Port Huron Ed Ass’n v Port Huron Area School Dist, 452 Mich 309, 319; 550 NW2d 228 (1996)]:
Because of the fundamental policy of freedom of contract, the parties are generally free to agree to whatever specific rules they like, and in most circumstances it is beyond the competence of the Authority, the National Labor Relations Board or the courts to interfere with the parties’ choice.

 Such limitations are justified in view of the fact that parties in such cases generally do not have either the opportunity or the capacity to negotiate and agree in advance to the most convenient venue.

 It should be noted in advance that the analysis would be different in a situation where the parties to the contract were not on an equal bargaining basis or the terms were not subject to negotiation, such as in a contract of adhesion.