Will a Rhode Island court send this case to the forum our contract chose?
No Rhode Island holding was found that a Rhode Island court will dismiss or stay a Rhode Island action because the contract chose another forum, which is itself the answer to plan around. There is a Rhode Island mechanism for declining the action, but it is not keyed to a clause: Kedy v. A.W. Chesterton Co. took up “the applicability of the doctrine of forum non conveniens in Rhode Island jurisprudence” and “join[ed] forty-six of our sister states and the federal courts by formally recognizing” it, vacating orders that had refused to dismiss thirty-nine Rhode Island actions brought by Canadian plaintiffs. One statute does speak, and it runs against the clause: under R.I. Gen. Laws § 6-34.1-1(a), in a contract “principally for the construction or repair of improvements to real property located in Rhode Island”, a provision subjecting it “to litigation in the courts of another state; or to arbitration in another state … is voidable by the party that is obligated by the contract to perform the construction or repair”, and § 6-34.1-1(e) gives the Rhode Island Superior Court “exclusive jurisdiction in relation to the construing or enforceability of § 6-34.1-1.” What the case law establishes is the mirror image: the clause is consent to the chosen court’s personal jurisdiction. “A party may waive his or her right to a personal-jurisdiction challenge ‘by entering into a contract that contains a forum selection clause’” (Sidell v. Sidell), and in Aspen American Insurance Company v. East Coast Precast & Rigging LLC the clause “if valid, declares the intent of defendants to waive any contention as to New York not having personal jurisdiction”, with its validity tested under NEW YORK law, because Rhode Island looks to the chosen state’s law on that question. The only Rhode Island decision that scrutinises a forum clause on the merits does so under federal maritime law: in Tateosian v. Celebrity Cruise Services, Ltd. “[t]he passenger ticket contract … is considered a maritime contract, the interpretation and enforcement of which is governed by federal maritime law”, and it is there, not as Rhode Island contract law, that “[f]orum selection clauses have been held prima facie valid” subject to “judicial scrutiny for fundamental fairness”.
The trap
Do not tell a Rhode Island client that the M/S Bremen prima-facie-validity rule is Rhode Island law. The only opinion located applying it, Tateosian, is a per curiam maritime case decided under federal maritime law, where the challenger bears “a heavy burden of proof”; no Rhode Island decision read here decides whether a Rhode Island court will give up a Rhode Island action to a chosen foreign forum. The practical consequence runs one way, and it is the dangerous way: a Rhode Island defendant who ignores a suit brought in the chosen forum is likely to face the resulting judgment here, because the clause supplies the consent the recognition inquiry asks about, and when the Supreme Court tests that clause it applies the CHOSEN state’s law, not Rhode Island’s (in Aspen the Court “must apply New York law in addressing the forgery argument presented by defendants”, and New York asks only whether enforcement would be “unreasonable and unjust”). On a construction contract the drafting point is § 6-34.1-1: a foreign-forum or foreign-arbitration clause is voidable, not void, so it binds a Rhode Island builder who does not avoid it, only the performing party may avoid it, and § 6-34.1-1(c) takes partnership, lending and property-management agreements outside the section altogether.
17 authorities
- statuteR.I. Gen. Laws § 6-34.1-1enactment date not established
The words that state the rule
If a contract is principally for the construction or repair of improvements to real property located in Rhode Island and the contract contains a provision that makes the contract or any conflict arising under it subject to the law of another state; to litigation in the courts of another state; or to arbitration in another state; that provision is voidable by the party that is obligated by the contract to perform the construction or repair.
- statuteR.I. Gen. Laws § 6-34.1-1enactment date not established
The words that state the rule
The superior court of the state of Rhode Island shall have exclusive jurisdiction in relation to the construing or enforceability of § 6-34.1-1.
- statuteR.I. Gen. Laws § 6-34.1-1enactment date not established
The words that state the rule
A contract is principally for the construction or repair of improvements to real property located in Rhode Island if the contract obligates a party, as its principal obligation under the contract, to provide labor, or labor and materials, for the construction or repair of improvements to real property located in Rhode Island as a general contractor or subcontractor.
- statuteR.I. Gen. Laws § 6-34.1-1enactment date not established
The words that state the rule
(1) The contract is a partnership agreement or other agreement governing an entity or trust; (2) The contract provides for a loan or other extension of credit and the party promising to construct or repair improvements does so as part of its agreements with the lender or other extender of credit; or (3) The contract is for the management of real property or improvements and the obligation to construct or repair is part of that management.
The words that state the rule
A party may waive his or her right to a personal-jurisdiction challenge “by entering into a contract that contains a forum selection clause.”
- caseNo. 2019-379-Appeal. (PC 19-5588) (R.I. June 2, 2021)Aspen American Insurance Company v. East Coast Precast & Rigging LLCR.I.decided 2021
The words that state the rule
The Indemnity Agreement in the instant case contains a forum selection clause, which, if valid, declares the intent of defendants to waive any contention as to New York not having personal jurisdiction.
- caseNo. 2019-379-Appeal. (PC 19-5588) (R.I. June 2, 2021)Aspen American Insurance Company v. East Coast Precast & Rigging LLCR.I.decided 2021
The words that state the rule
Thus, in the instant case, where we are concerned with whether or not New York had personal jurisdiction over defendants by virtue of the forum selection clause, we, just as did the hearing justice, must apply New York law in addressing the forgery argument presented by defendants.
- case768 A.2d 1248Tateosian v. Celebrity Cruise Services, Ltd.R.I.decided 2001read it at the source ↗
The words that state the rule
The decisive issue in this case is whether the terms of a cruise contract were fundamentally unfair and specifically, its forum selection clause.
- case768 A.2d 1248Tateosian v. Celebrity Cruise Services, Ltd.R.I.decided 2001read it at the source ↗
The words that state the rule
The passenger ticket contract at issue in this case is considered a maritime contract, the interpretation and enforcement of which is governed by federal maritime law.
- case768 A.2d 1248Tateosian v. Celebrity Cruise Services, Ltd.R.I.decided 2001read it at the source ↗
The words that state the rule
A party claiming that the fundamental fairness standard has not been met bears “a heavy burden of proof.”
- case768 A.2d 1248Tateosian v. Celebrity Cruise Services, Ltd.R.I.decided 2001read it at the source ↗
The words that state the rule
Forum selection clauses have been held prima facie valid, M/S Bremen v. Zapata OffShore Co., 407 U.S. 1, 10 , 92 S.Ct. 1907, 1913 , 32 L.Ed.2d 513, 520 (1972), but they are subject to judicial scrutiny for fundamental fairness.
- caseNo. 2019-379-Appeal. (PC 19-5588) (R.I. June 2, 2021)Aspen American Insurance Company v. East Coast Precast & Rigging LLCR.I.decided 2021
The words that state the rule
In New York, forum selection clauses “are prima facie valid and enforceable unless shown by the resisting party to be unreasonable * * *.” Brooke Group Ltd. v. JCH Syndicate 488, 663 N.E.2d 635, 637 (N.Y. 1996).
- caseNo. 2019-379-Appeal. (PC 19-5588) (R.I. June 2, 2021)Aspen American Insurance Company v. East Coast Precast & Rigging LLCR.I.decided 2021
The words that state the rule
selection clause in the Indemnity Agreement is valid. Accordingly, the New York court at issue had personal jurisdiction over the defendants by virtue of the forum selection clause. - 18 - IV Conclusion Accordingly, we affirm the order of the Superior Court.
- case768 A.2d 1248Tateosian v. Celebrity Cruise Services, Ltd.R.I.decided 2001read it at the source ↗
The words that state the rule
In light of these undisputed facts and with no material questions of fact remaining, we conclude that summary judgment for Celebrity was correct.
- statuteR.I. Gen. Laws § 6-34.1-1enactment date not established
The words that state the rule
Subsections (b) and (c) of this section are not an exclusive list of situations in which a contract is or is not principally for the construction or repair of improvements to real property located in this state.
The words that state the rule
We issued a writ of certiorari to consider the applicability of the doctrine of forum non conveniens in Rhode Island jurisprudence. The petitioners/defendants sought review of Superior Court orders denying their motions to dismiss in thirty-nine civil actions filed in Rhode Island by Canadian residents. For the reasons set forth in this opinion, we join forty-six of our sister states and the federal courts by formally recognizing the doctrine of forum non conveniens. We vacate, therefore, the orders of the Superior Court.
- caseNo. 2019-379-Appeal. (PC 19-5588) (R.I. June 2, 2021)Aspen American Insurance Company v. East Coast Precast & Rigging LLCR.I.decided 2021
The words that state the rule
Accordingly, New York law provides as follows: “[Forum selection clauses will not be] set aside unless a party demonstrates that the enforcement of such would be unreasonable and unjust or that the clause is invalid because of fraud or overreaching, such that a trial in the contractual forum would be so gravely difficult and inconvenient that the challenging party would, for all practical purposes, be deprived of his or her day in court * * *.” Sterling National Bank v. Eastern Shipping Worldwide, Inc., 826 N.Y.S.2d 235, 237 (N.Y. App. Div. 2006)
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.