Shelter Mutual Insurance Company v. Rimkus Consulting Group, Inc. of Louisiana
148 So. 3d 871
La.2014Background
- Rimkus (engineering consultant) sent Shelter a confirmation letter incorporating its "Terms and Conditions," which contained a forum‑selection clause requiring suits to be brought in Harris County, Texas.
- Shelter sued Rimkus in Lafayette Parish, alleging negligent/expert-opinion errors and related damages; Rimkus raised a declinatory exception of improper venue based on the clause.
- Trial court found the parties tacitly agreed to Rimkus’ Terms and Conditions but, following the Third Circuit decision in Thompson Tree, denied the exception as forum clauses were held against Louisiana public policy; the court of appeal denied writ; this Court granted review.
- The Supreme Court examined whether the Terms and Conditions were part of the parties’ agreement (affirmative) and whether forum‑selection clauses are per se violative of Louisiana public policy.
- The Court rejected Thompson Tree’s broad reading of La. C.C.P. art. 44(A) and related statutes, holding forum‑selection clauses are prima facie valid and enforceable unless enforcement is unreasonable, unjust, procured by fraud/overreaching, or contravenes a strong forum public policy.
Issues
| Issue | Plaintiff's Argument (Shelter) | Defendant's Argument (Rimkus) | Held |
|---|---|---|---|
| Were Rimkus’ "Terms and Conditions" incorporated into the parties' contract? | Shelter: terms were unilateral, not agreed to, thus not part of contract. | Rimkus: terms were repeatedly provided and tacitly accepted in prior dealings and course of performance. | Held: Terms were tacitly incorporated based on prior dealings and conduct. |
| Are forum‑selection clauses per se violative of Louisiana public policy? | Shelter: Art. 44(A) and statutes (La. R.S. 51:1407, 9:2779, 23:921) show a strong public policy forbidding pre‑suit venue waivers. | Rimkus: Art. 44(A) does not prohibit contractual forum choice; statutes are limited and do not create a blanket rule. | Held: Forum‑selection clauses are not per se violative; generally enforceable. |
| Does La. C.C.P. art. 44(A) bar contractual forum selection? | Shelter: Article prohibits waiver of venue prior to suit, so clauses that fix venue pre‑suit are banned. | Rimkus: Article concerns a defendant's objection to venue, not parties' contractual agreement to fix venue; text is clear and unambiguous. | Held: Art. 44(A) prohibits pre‑suit waiver of the objection to venue but does not by its text declare all forum clauses unenforceable. |
| Standard for enforcing a forum‑selection clause in Louisiana | Shelter: enforcement should be barred unless statutes allow. | Rimkus: follow Bremen and related jurisprudence — clauses prima facie valid; enforce unless unreasonable, fraud, or contravenes strong public policy. | Held: Adopt Bremen standard: enforce unless resisting party clearly shows enforcement unreasonable/unjust, procured by fraud/overreaching, or would contravene a strong forum public policy. |
Key Cases Cited
- M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (U.S. 1972) (forum‑selection clauses are prima facie valid and enforceable absent unreasonableness, fraud, or strong forum public policy)
- Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585 (U.S. 1991) (federal admiralty/adjudication contexts applying forum‑selection principles)
- Lejano v. Bandak, 705 So.2d 158 (La. 1997) (applied federal law in admiralty to enforce forum clause; distinguished from general state‑law rule)
- Thompson Tree & Spraying Serv., Inc. v. White‑Spunner Const., Inc., 68 So.3d 1142 (La. Ct. App. 3d Cir.) (held forum clauses unenforceable as against Louisiana public policy; rejected by this Court)
- Sawicki v. K/S Stavanger Prince, 802 So.2d 598 (La. 2001) (applied statutory public policy in employment‑contract context to invalidate a forum‑selection clause)