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Carroll v. United Airlines

November 03, 1999

JOHN DOUGLAS CARROLL AND SYLVIA CARROLL, PLAINTIFF,
v.
UNITED AIRLINES, INC., A CORPORATION DOING BUSINESS IN THE STATE OF NEW JERSEY, DEFENDANT/THIRD-PARTY PLAINTIFF-RESPONDENT, AND JSS, INC., THIRD-PARTY/DEFENDANT-APPELLANT.



Before Judges Petrella, Conley and Coburn.

The opinion of the court was delivered by: Conley, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted October 12, 1999

On appeal from Superior Court of New Jersey, Law Division, Essex County.

This interlocutory appeal, on leave granted by the Supreme Court, involves the denial of third-party defendant's motion to dismiss the third-party complaint for lack of subject-matter jurisdiction and in personam jurisdiction. We affirm in part and remand in part.

Simply stated, plaintiff, a paraplegic passenger on defendant/third-party-plaintiff United Airline's (United) round-trip flight from Newark, New Jersey to Japan, was injured when he fell or was dropped while being disembarked from the plane in Japan. At the time, third-party defendant JSS, a Japanese corporation, was providing wheelchair services to plaintiff pursuant to a written agreement with United. As far as the present record reveals, JSS has no direct contacts with New Jersey or any other state in the nation. Its wheelchair agreement, however, contains an indemnification clause for injuries caused by its negligence to United's passengers. That was, of course, the basis for the third-party complaint against JSS seeking indemnification.

I.

Subject-Matter Jurisdiction

Subject-matter jurisdiction involves the threshold determination as to whether the court is legally authorized to decide the question presented. Gilbert v. Gladden, 87 N.J. 275, 280-81 (1981). It concerns the forum or venue in which such jurisdiction is established by statute or rule. Not infrequently, however, and often in commercial settings, a forum is voluntarily selected and agreed to by the parties. Such forum selection clauses are enforceable, provided there are no countervailing fraud, public policy, or serious inconvenience concerns. Caspi v. Microsoft Network, L.L.C., 323 N.J. Super. 118, 122 (App. Div. 1999); McNeill v. Zoref, 297 N.J. Super. 213, 219 (App. Div. 1997); Wilfred MacDonald, Inc. v. Cushman, Inc., 256 N.J. Super. 58, 63-64 (App. Div.), certif. denied, 130 N.J. 17 (1992). Compare Kubis & Persyk Assoc. Inc. v. Sun Microsystems, Inc., 146 N.J. 176, 191-92 (1996) ("forum-selection clauses in contracts subject to the Franchise Act . . . are presumptively invalid because they fundamentally conflict with the basic legislative objectives of protecting franchisees from the superior bargaining power of franchisors and providing swift and effective judicial relief against franchisors that violate the act."); Param Petroleum Corp. v. Commerce & Industry Insurance Co., 296 N.J. Super. 164, 167 (App. Div. 1997).

Here, in its initial motion papers JSS argued that the New Jersey court lacked subject-matter jurisdiction over United's indemnification claim based upon a negotiated forum clause under which Japan was the proper forum. Here are the pertinent facts.

At the time of the accident, two separate contracts, negotiated on the same day, governed the relationship between United and JSS. One, entitled "Consigned Baggage Security Inspection Duty Commission Agreement," contained a clause that provided:

United Airlines and JSS agree that this Agreement shall be interpreted entirely according to Japanese law, and all legal actions arising from this agreement shall be under the jurisdiction of the Osaka District Court and the Osaka Summary Court. [Emphasis added.]

By contrast, the second agreement, entitled "Memorandum" and concerning solely wheelchair services, did not specify a particular resolution of disputes arising thereunder. It is this agreement that contained the critical indemnification clause at issue here.

The only reference in this agreement to the baggage agreement is in the provision that set forth charges and terms of payment and which provided for such payment to be in accordance with the payment provisions of the baggage agreement. There is nothing in either of the documents that required them to be construed as one contract or that incorporated the forum provisions of the baggage agreement into the wheelchair agreement. And, ...


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