867 F.2d 697 (D.C. Cir. 1989), 88-7077, Commerce Consultants Intern., Inc. v. Vetrerie Riunite, S.p.A.

Docket Nº:88-7077.
Citation:867 F.2d 697
Party Name:COMMERCE CONSULTANTS INTERNATIONAL, INC., Appellant, v. VETRERIE RIUNITE, S.p.A., Appellee.
Case Date:February 14, 1989
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit

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867 F.2d 697 (D.C. Cir. 1989)

COMMERCE CONSULTANTS INTERNATIONAL, INC., Appellant,

v.

VETRERIE RIUNITE, S.p.A., Appellee.

No. 88-7077.

United States Court of Appeals, District of Columbia Circuit.

February 14, 1989

Argued Nov. 22, 1988.

Russell J. Gaspar, Washington, D.C., for appellant.

Dario Ceppi, New York City, for appellee. Mark C. Ellenberg and David F. Williams, Washington, D.C., also entered appearances for appellee.

Before EDWARDS, WILLIAMS, and FRIEDMAN, [*] Circuit Judges.

Opinion for the Court filed by Circuit Judge FRIEDMAN.

FRIEDMAN, Circuit Judge:

This is an appeal from an order dismissing, for improper venue, a breach of contract suit by an American corporation against the other party to the contract, an Italian corporation. Commerce Consultants Int'l v. Vetrerie Riunite, No. 87-2104 (Jan. 28, 1988, D.D.C.). The ground

Page 698

for dismissal was that, under the contract, suit could be brought only in an Italian court. We affirm.

I

A. The appellant, Commerce Consultants International, Inc. (Commerce Consultants), a District of Columbia corporation, entered into a written contract with Vetrerie Riunite, S.p.A. (Riunite), an Italian corporation, under which Commerce Consultants became Riunite's exclusive agent for the sale of Riunite's lenses in North America. The written agreement was drafted in English for Commerce Consultants by its employee Michael Galbraith, who was fluent in Italian, but not a lawyer. According to Galbraith's affidavit, Galbraith "was the sole person responsible for all of the relations between" the two companies.

The draft of the agreement that Galbraith sent to Riunite's representative in the negotiations, Rossi, contained the following provision:

13. The validity, enforceability and interpretation of this agreement shall be determined and governed by the laws of the District of Columbia, U.S.A.

In a letter that accompanied the agreement, written in Italian, Galbraith stated: "Of course, should you wish to modify any provision, we would be pleased to comply, based on your comments."

In response, Rossi stated in a Telex that his company was "in agreement with all points" except for two, one of which was (as translated into English by Galbraith):

Responsible will be the Verona court rather than the United States one.

Galbraith then redrafted paragraph 13 of the agreement to read:

13. The validity, enforceability and interpretation of this agreement shall be determined and governed by the appropriate court of Verona, Italy.

Galbraith sent the revised agreement to Rossi, and Riunite executed it.

B. More than a year after the contract was signed, Commerce Consultants filed in the district court a suit against Riunite alleging that Riunite had breached the contract by itself selling its products in the United States, in violation of Commerce Consultants' appointment as Riunite's exclusive sales agent there, and by terminating the contract before its expiration date.

Riunite moved, pursuant to Rule 12(b)(3) of the Federal Rules of Civil Procedure, to dismiss the complaint for improper venue, because under the contract such a suit could be maintained only in the courts of Verona, Italy. The district court granted the motion.

The court held that paragraph 13 of the "agreement is unambiguous and the product of fair arms-length bargaining," and that it was a "choice-of-forum clause" and not a "choice-of-law" provision. The court rejected Commerce Consultants' contention that "even if the contract language is construed as a choice-of-forum provision, it should not be enforced because under the Italian system for conducting civil cases, CCI would effectively be deprived of its day in court." Id., slip op. at 5. The court stated that "[t]he court sees no reason to believe that reliance on the Italian courts will depreive [sic] CCI of its day in court." Id. at 6. The court

conclude[d] that paragraph 13 of the parties' agreement of February 26, 1986 requires plaintiff's claims to be brought in the courts of Verona, Italy. Defendant's motion to dismiss this case for improper venue is granted.

Id.

II

The district court correctly held (A) that paragraph 13 of the contract was a choice-of-forum and not a choice-of-law clause, and (B) that enforcement of paragraph 13 to require that the case be brought in Italy was proper.

A. Paragraph 13 unambiguously specified where any litigation relating to the contract should be conducted and, by implication, what law should be applied in such case. It states that the "validity, enforceability and interpretation" of the contract "shall be determined" by the "appropriate court...

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