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Double J. Enterprise, Inc. v. V & H


May 30, 2007


On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-3191-04.

Per curiam.


Submitted October 31, 2006

Before Judges Weissbard and Graves.

Plaintiffs, Double J. Enterprise, Inc., and its owner, Gary Gallopo, appeal from an order granting summary judgment in favor of defendant V & H, Inc., and dismissing their complaint. The trial court reasoned that a forum-selection clause in a contract signed by the parties required plaintiffs to litigate their claims in the courts of Wisconsin. We affirm.

Defendant is in the business of selling trucks in Wisconsin. After some preliminary negotiations, plaintiff Gary Gallopo traveled from New Jersey to Wisconsin on April 7, 2004, to purchase a used 1998 Peterbilt truck from defendant for the sum of $76,044.61. The motor vehicle purchase contract signed by the parties contains a choice of law and forum-selection clause that reads as follows:

GOVERNING LAW AND JURISDICTION: This Agreement shall be governed by and construed in accordance with the Statutes and Common law of the State of Wisconsin. If not prohibited by law, both parties hereby agree to submit to the jurisdiction of the Courts of Wisconsin for enforcement of this Agreement.

After paying for the truck and returning to New Jersey, plaintiffs filed the present action for compensatory and punitive damages. Plaintiffs allege that defendant made false representations regarding the truck's mileage in violation of the New Jersey Consumer Fraud Act, and "New Jersey Statutes with regard to odometer and odometer roll-back and the truth of odometer readings." Plaintiffs also allege that defendant's misrepresentations constituted an act of fraud. In its answer to plaintiffs' complaint, defendant denied each of plaintiffs' claims, and, in a motion for summary judgment, argued:

The contract containing the forum selection clause was executed in Wisconsin. Further, plaintiffs inspected the vehicle in Wisconsin and picked it up at that location. There is nothing in the record to suggest that clause is a result of fraud or unfair bargaining powers, violates a strong public policy of New Jersey, or that enforcement would seriously inconvenience trial. Accordingly, the forum selection clause is enforceable and therefore the complaint should be dismissed.

In addition, defendant claimed it was entitled to summary judgment because plaintiffs did not have an expert witness to substantiate their claim that the truck's actual mileage exceeded the mileage indicated on the truck's odometer. In response to this argument, Gallopo certified that he had sufficient experience in the trucking industry to testify regarding "odometer discrepancies":

I have been in the trucking industry since 1975, in excess of 30 years. I am currently 55 years of age. During my 30 years in the trucking industry, I have bought and sold at least 10 separate trucks and driven hundreds of different types of makes and models, including the truck in this case. I am completely familiar with the industry as well as the pricing guidelines for buying and selling as well as trading trucks. Not only have I bought and sold at least 10 trucks for my own business and for myself personally, but I have assisted many others in the industry as far as shopping for, looking at and helping others negotiate prices of trucks. I am also familiar with the value of trucks and the reduction thereof as a result of damage as well as odometer discrepancies. I have performed repairs on all my trucks during the past 25 years and I have assisted numerous others in the industry. I am familiar with both the value of my truck and the mechanical workings of it intimately, as well as the ability to look at other trucks and value other trucks in the industry as a result of my experience in the industry over the past 30 years.

Following oral argument, the trial court ruled that the forum-selection clause was enforceable, and it entered an order dismissing plaintiffs' complaint. The court's findings included the following:

I'm taking a position that this is not some kind of a naïve purchaser. This is not somebody who walks into a situation where he was taken advantage of. It's clear to me that the plaintiff[s] [are] well-versed in the trucking business. Double J. Enterprise is a trucker and in the business of trucking, as his counsel has said, for over 20 years. And V & H is in the business of selling trucks.

They have a contract that states that everything will be governed by the State of Wisconsin and it says specifically both parties hereby agree to submit to the jurisdiction of the Courts of Wisconsin for enforcement of this agreement.

I do find that it was an arm's length contract entered into by business people. These are not people walking in off the street deciding on a lark to buy a tractor trailer. I find that the language in the contract is clear. The parties have agreed to a forum selection clause. It does not violate the public policy of the State of New Jersey and I'm going to enforce it.

Forum-selection clauses are routinely enforced in New Jersey. Caspi v. Microsoft Network, L.L.C., 323 N.J. Super. 118, 122 (App. Div.), certif. denied, 162 N.J. 199 (1999). As a general rule, a forum-selection clause is enforceable unless the objecting party demonstrates (1) the clause is a result of fraud, undue influence, or "overweening" bargaining power, (2) enforcement in a foreign forum would violate a strong public policy of this State, or (3) enforcement would be seriously inconvenient for the trial. Wilfred MacDonald, Inc. v. Cushman, Inc., 256 N.J. Super. 58, 63-64 (App. Div.), certif. denied, 130 N.J. 17 (1992) (citing M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 12, 92 S.Ct. 1907, 1914, 32 L.Ed. 2d 513, 522 (1972)).

As noted by the New Jersey Supreme Court, the holding in Bremen "represents the prevailing view on the enforceability of forum- selection clauses." Kubis & Perszyk Assoc., Inc. v. Sun Microsystems, Inc., 146 N.J. 176, 188 (1996). Moreover, the principles set forth in Bremen are consistent with the Restatement (Second) of Conflict of Laws § 80 (1988): "[t]he parties' agreement as to the place of the action will be given effect unless it is unfair or unreasonable."

"In the light of present-day commercial realities" and expanding international trade," the Bremen Court concluded that a forum-selection clause "should control absent a strong showing that it should be set aside." Id. at 15, 92 S.Ct. at 1916, 32 L.Ed. 2d at 523. The Court explained its reasons for adopting a more hospitable attitude toward forum-selection clauses:

The argument that such clauses are improper because they tend to "oust" a court of jurisdiction is hardly more than a vestigial legal fiction. It appears to rest at core on historical judicial resistance to any attempt to reduce the power and business of a particular court and has little place in an era when all courts are overloaded and when businesses once essentially local now operate in world markets. It reflects something of a provincial attitude regarding the fairness of other tribunals.

[407 U.S. at 12, 92 S.Ct. at 1914, 32 L.Ed. 2d at 521.]

In this case, plaintiffs do not contend the disputed contract clause is "prohibited by law," unreasonable under the circumstances, or violative of New Jersey public policy. And plaintiffs do not claim that it resulted from fraud or unfair bargaining power, or that its enforcement would seriously inconvenience a trial. Rather, plaintiffs contend the clause does not designate Wisconsin as the exclusive forum for resolving disputes. According to plaintiffs, the clause "only states that the parties agreed to submit to the jurisdiction of Wisconsin. The agreement does not state that the parties are required to submit all disputes to the jurisdiction of Wisconsin."

In Bremen, the Supreme Court enforced a forum-selection clause that stated, "[a]ny dispute arising must be treated before the London Court of Justice." Bremen, supra, 407 U.S. at 2, 92 S.Ct. at 1909, 33 L.Ed. 2d at 516. That language, which is substantially similar to the language at issue in this case, was deemed by the Court to be "clearly mandatory and all- encompassing." Id. at 20, 92 S.Ct. at 1918, 32 L.Ed. 2d at 526. Thus, in our view, the trial court correctly concluded that this case must proceed where the parties knowingly agreed---- in the courts of Wisconsin.



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