Northern California Dist. Council of Laborers v. Pittsburg-Des Moines Steel Co.

• Decision Date: 13 November 1995
• Docket Number: PITTSBURG-DES,No. 93-16645,P,No. 185,185,93-16645
• Parties: 150 L.R.R.M. (BNA) 2839, 131 Lab.Cas. P 11,452, 95 Cal. Daily Op. Serv. 8699, 95 Daily Journal D.A.R. 15,055 NORTHERN CALIFORNIA DISTRICT COUNCIL OF LABORERS, on its own Behalf and on Behalf of Laborers Local Unionlaintiff-Appellee, v.MOINES STEEL CO., Defendant, and Pitt-Des Moines, Inc., Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1034

69 F.3d 1034

150 L.R.R.M. (BNA) 2839, 131 Lab.Cas. P 11,452,

95 Cal. Daily Op. Serv. 8699,

95 Daily Journal D.A.R. 15,055

NORTHERN CALIFORNIA DISTRICT COUNCIL OF LABORERS, on its own Behalf and on Behalf of Laborers Local Union No 185, Plaintiff-Appellee, v. PITTSBURG-DES MOINES STEEL CO., Defendant and Pitt-Des Moines, Inc., Defendant-Appellant.

No. 93-16645.

United States Court of Appeals Ninth Circuit.

Argued and Submitted March 13, 1995.

Decided Nov. 13, 1995.

William S. Myers, Ogletree, Deakins, Nash, Smoak & Stewart, Atlanta, Georgia, for defendant-appellant.

Victor J. Van Bourg, Van Bourg, Weinberg, Roger & Rosenfeld, Oakland, California, for plaintiff-appellee.

Appeal from the United States District Court for the Northern District of California.

Before NORRIS, WIGGINS, and FERNANDEZ, Circuit Judges.

OPINION

WILLIAM A. NORRIS, Circuit Judge:

This action to confirm an arbitration award was originally filed in San Francisco Superior Court by the Northern California District Council of Laborers. Defendant Pitt-Des Moines, Inc. removed the action to federal court, asserting federal question and diversity jurisdiction. The district court remanded the case to San Francisco Superior Court on alternative grounds, both of which Pitt-Des Moines now challenges.

First, the district court held that a forum selection clause in the collective bargaining agreement vested exclusive jurisdiction in San Francisco Superior Court over actions to confirm arbitration awards. ¹ Pitt-Des Moines argues that the forum selection clause was permissive (permitting jurisdiction in Superior Court) rather than mandatory (requiring that actions be brought only in that court).

Second, the district court held that Pitt-Des Moines' failure to join P.D.M. Steel Co., a named co-defendant, in the removal petition rendered the petition procedurally defective under 28 U.S.C. Sec. 1441(a). Pitt-Des Moines argues that the district court lacked authority to remand on this basis because the Laborers did not raise the issue of a defect in removal procedure within the 30-day period prescribed by 28 U.S.C. Sec. 1447(c).

We consider these issues in turn. ²

I Forum Selection Clause

The question whether the forum selection clause is mandatory or permissive is a matter of contract interpretation that we review de novo because it does not turn on the credibility of extrinsic evidence. ³ Hunt Wesson Foods, Inc. v. Supreme Oil Co., 817 F.2d 75, 77 (9th Cir.1987).

The forum selection clause reads as follows:

[a] decision of the Board of Adjustment ... or the decision of a permanent arbitrator shall be enforceable by a petition to confirm an arbitration award filed in the Superior Court of the City and County of San Francisco, State of California.

The Laborers interpret the clause to mean that San Francisco Superior Court is the exclusive forum in which arbitration awards may be enforced. Pitt-Des Moines responds that the effect of the clause is merely that both parties consent to jurisdiction and venue in San Francisco Superior Court, but not that they cannot litigate elsewhere. In our view, Hunt Wesson Foods, Inc. v. Supreme Oil Co., 817 F.2d 75 (9th Cir.1987), is controlling authority that the forum selection clause at issue here is permissive, as Pitt-Des Moines contends, not mandatory, as the Laborers contend.

In Hunt Wesson, the forum selection clause provided that the courts of Orange County, California, "shall have jurisdiction over the parties in any action" arising out of the contract. Id. at 76. In interpreting this language as permissive rather than mandatory, we said:

The language says nothing about the Orange County courts having exclusive jurisdiction. The effect of the language is merely that the parties consent to the jurisdiction of the Orange County courts. Although the word "shall" is a mandatory term, here it mandates nothing more than that the Orange County courts have jurisdiction. Thus, [the defendant] cannot object to litigation in the Orange County Superior Court on the ground that the court lacks personal jurisdiction. Such consent to jurisdiction, however, does not mean that the same subject matter cannot be litigated in any other court. In other words, the forum selection clause in this case is permissive rather than mandatory.

Id. at 77.

To be mandatory, a clause must contain language that clearly designates a forum as the exclusive one. For example, in Hunt Wesson we distinguished the clause at issue in Pelleport Investors, Inc. v. Budco Quality Theatres, Inc., 741 F.2d 273, 275 (9th Cir.1984), which stated that "this Agreement shall be litigated only in the Superior Court for Los Angeles, California (and in no other)...." Hunt Wesson, 817 F.2d at 77. Similarly, in Docksider, Ltd. v. Sea Technology, Ltd., 875 F.2d 762 (9th Cir.1989), we held that a clause was rendered mandatory by the additional language that "venue of any action brought hereunder shall be deemed to be in Gloucester County, Virginia." Id. at 764. In distinguishing Hunt Wesson, we said

[t]his language requires enforcement of the clause because Docksider not only consented to the jurisdiction of the state courts of Virginia, but further agreed by mandatory language that the venue for all actions arising out of the license agreement would be Gloucester County, Virginia. This mandatory language makes clear that venue, the place of suit, lies exclusively in the designated county. Thus, whether or not several states might otherwise have jurisdiction over actions stemming from the agreement, all actions must be filed and prosecuted in Virginia.

Id.

These cases demonstrate that the forum selection clause now before us is permissive. The language "shall be enforceable" is no less permissive than the "shall have jurisdiction" language in Hunt Wesson. The clause does not contain additional language such as "venue ... shall be deemed to be in Gloucester County," which, in Docksider, designated the state court as the exclusive forum. Nor does it contain the type of mandatory language at issue in Pelleport (cases may be litigated "only in" Los Angeles). In sum, we follow Hunt Wesson in holding that the "shall be enforceable" language at issue here is permissive, not mandatory, because it does not contain language "clearly requir[ing] exclusive jurisdiction." Hunt Wesson, 817 F.2d at 77.

II Defect in Removal Procedure

A remand motion based on a defect in removal procedure must be filed within 30 days after the notice of removal is filed. 28 U.S.C. Sec. 1447(c). ⁴ The Laborers' remand motion was filed within 30 days after removal, but it was based solely on the argument that the forum selection clause required remand to San Francisco Superior Court. The Laborers did not raise a defect in removal procedure as a ground for remand until they filed a reply brief more than 30 days after the filing of the removal petition.

Pitt-Des Moines argues that the district court had no jurisdiction to order a remand based upon a defect in removal procedure because the issue was not raised within the 30-day time period prescribed by Sec. 1447(c). The Laborers respond that it is of no consequence that the issue was not raised within the 30-day time limit because Sec. 1447(c) establishes only the time by which a remand motion must be filed, not the time by which any particular argument must be raised. The narrow question presented, therefore, is whether Sec. 1447(c) requires that a defect in removal procedure be raised within 30 days after the filing of the removal petition, as Pitt-Des Moines contends, or whether Sec. 1447(c) permits a procedural defect to be raised after the 30-day period as long as the defect is raised in connection with a timely motion to remand.

We first address the threshold question whether a remand order based upon a defect in removal procedure is subject to appellate review. Although Sec. 1447(d) on its face appears to withdraw all appellate jurisdiction to review remand orders, ⁵ the statute is not without exceptions. See Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336, 351-52, 96 S.Ct. 584, 593-94, 46 L.Ed.2d 542 (1976). We agree with the Seventh Circuit...