Legal Memorandum: Validity of Forum Selection Clauses

Issue: Are forum selection clauses valid?

Area of Law: Business Organizations & Contracts, Litigation & Procedure
Keywords: Forum-selection clauses; Prima facie valid
Jurisdiction: Federal
Cited Cases: 407 U.S. 1
Cited Statutes: None
Date: 08/01/2000

Forum-selection clauses are prima facie valid and should be enforced unless the party seeking to avoid the clause shows that enforcement would be unreasonable under the circumstances. M/S/Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10 (1972).  A forum-selection clause is only unreasonable when its enforcement would “seriously impair” the moving party’s ability to pursue its claims or defenses.  Elia Corp., 391 A.2d at 216.  Mere inconvenience or additional expense is not the test of unreasonableness.  If the agreed-upon forum can do substantial justice, a contracting party is bound by the bargain.  Id.  “In light of present day commercial realities, a forum clause should control absent a strong showing that it should be set aside.”  Simm Assocs., Inc. v. PNC Nat’l Bank, No. 98C-02-219-WTQ (Del. Super. Ct. Oct. 8, 1998).


Subscribe to Litigation Pathfinder

To get the full-text of this Legal Memorandum ... and more!

(Month-to-month and annual subscriptions available)