Outbound Forum Selection Clause - Ex Parte PT Solutions Holdings, LLC

Ex parte PT Solutions Holdings, LLC, [Ms. 1150687, Nov. 23, 2016] __ So. 3d __ (Ala. 2016). The Supreme Court grants a petition for a writ of mandamus and directs the Barber Circuit Court to vacate an order denying a motion to dismiss a complaint based upon a contractually agreed-upon outbound forum selection clause which requires litigation of claims between the parties to take place in Fulton County, Georgia.

The standard of review in determining whether an outbound forum selection clause is enforceable is as follows:

II. Standard of Review

"[A]n attempt to seek enforcement of the outbound forum-selection clause is properly presented in a motion to dismiss without prejudice, pursuant to Rule 12(b)(3), Ala. R. Civ. P., for contractually improper venue. Additionally, we note that a party may submit evidentiary matters to support a motion to dismiss that attacks venue. Williams v. Skysite Communications Corp., 781 So. 2d 241 (Ala. Civ. App. 2000), quoting Crowe v. City of Athens, 733 So. 2d 447, 449 (Ala. Civ. App. 1999)."

Ex parte D.M. White Constr. Co., 806 So. 2d 370, 372 (Ala. 2001).

"'[A] petition for a writ of mandamus is the proper vehicle for obtaining review of an order denying enforcement of an "outbound" forum-selection clause when it is presented in a motion to dismiss.' Ex parte D.M. White Constr. Co., 806 So. 2d 370, 372 (Ala. 2001); see Ex parte CTB, Inc., 782 So. 2d 188, 190 (Ala. 2000). '[A] writ of mandamus is an extraordinary remedy, which requires the petitioner to demonstrate a clear, legal right to the relief sought, or an abuse of discretion.' Ex parte Palm Harbor Homes, Inc., 798 So. 2d 656, 660 (Ala. 2001). '[T]he review of a trial court's ruling on the question of enforcing a forum-selection clause is for an abuse of discretion.' Ex parte D.M. White Constr. Co., 806 So. 2d at 372."

Ex parte Leasecomm Corp., 886 So. 2d 58, 62 (Ala. 2003).

Ms. *11.

Under authority of M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972), Professional Ins. Corp. v. Sutherland, 700 So. 2d 347 (Ala. 1997, and Ex parte Leasecomm Corp., supra, 886 So. 2d at 62-63, the Court rejected challenges to this particular clause premised upon the contention that the forum selection clause is invalid because it is contained in a non-competition agreement involving professionals which allegedly violates Alabama public policy. The Court holds instead that M/S Bremen requires forum selection clauses to be unenforceable only when enforcement of the forum selection clause itself would contravene a strong public policy of the forum in which the suit is brought. In other words, the focus must be on whether the forum selection clause contravenes public policy, not whether the underlying contract that contains the forum selection clause contravenes public policy. Ms. *15-16. Because "[i]t has long been established that forum selection clauses are not against Alabama public policy ...." Ex parte Riverfront, LLC, 129 So. 3d 1008, 1015 (Ala. 2013)(Ms. *16), the contractually agreed-upon outbound forum selection clause requiring litigation of the parties' disputes to be conducted in Georgia warrants dismissal of the lawsuit between the parties in the Barber Circuit Court. Accordingly, the petition for writ of mandamus is granted and the Barber Circuit Court is ordered to grant the motion to dismiss without prejudice.

Related Documents: Ex parte PT Solutions Holdings


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