News & Noteworthy

Authored - NJ Contract Law Update - Besler v. Coluccio: Forum Selection Clause
Windels Marx - Commercial Litigation
OCTOBER 01, 2012

Belser v. Coluccio, 2012 WL 3822090 (N.J.App.Div. September 2012), illuminates a particular type of contract provision: the forum selection clause. Such clauses are part of the matrix of pre-determining whether disputes that may arise under a contract should proceed in court or in arbitration; where either type of proceeding should be held; and similar issues.1 Obviously, if the parties do not choose a forum, a court will determine same--if only by adjudicating any motion addressed to the propriety of the forum.

Although the issue is not normally presented in syllogistic fashion, that sort of 'decision tree' is the correct model for contract drafters; who should simultaneously determine:

  1. Whether proceedings are to be in court or in arbitration.
  2. If in Court, where? Which State, which courts (perhaps state v. federal court), etc.?
  3. And if in arbitration, where should arbitration and confirmation each take place; where should enforcement be permitted; and where should ancillary judicial proceedings (e.g., TRO's) takeplace?2

Besler involved one variant of a forum-choice provision: a provision that allows for jurisdiction in a particular venue, but does not mandate such venue. That type of provision affords a party the option of proceeding in either the chosen forum or any other jurisdictionally permissible one. The Court in Besler recognized that the type of clause at issue there was permissive; and therefore held that the extant proceedings in New Jersey--rather than in the expressly-permitted (but not mandated) Pennsylvania jurisdiction mentioned in the contract documents--were valid.

The morals of the story are:

  1. To draft forum-related clauses syllogistically; and
  2. To know the difference between permissive and mandatory language.

Contact & Legal Disclaimer

Clark Alpert is the author of Guide to New Jersey Contract Law, published by the New Jersey Institute for Continuing Legal Education, originally published in 2007 and updated in November 2011. His updates on New Jersey contract law are based in recent issues and practical methods for addressing similar situations in your practice or business. They are not intended to serve as legal advice. Clark welcomes your questions and comments.

1 See generally Alpert, Guide to New Jersey Contract Law (2d Ed. 2011)("Boilerplate Provisions" Section of CDROM).

2 See prior footnote.

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