Bank of America, NA v. Miller

• Decision Date: 19 October 2001
• Docket Number: No. 26595-8-II.,26595-8-II.
• Citation: 33 P.3d 91,108 Wash.App. 745
• Court: Washington Court of Appeals
• Parties: BANK OF AMERICA, N.A., Appellant, v. Glen A. MILLER d/b/a Glen Miller Farm and Diane K. Miller, Respondents.

33 P.3d 91

108 Wash.App. 745

BANK OF AMERICA, N.A., Appellant, v. Glen A. MILLER d/b/a Glen Miller Farm and Diane K. Miller, Respondents.

No. 26595-8-II.

Court of Appeals of Washington, Division 2.

October 19, 2001.

Edward W. Pettigrew, Jeffrey August Beaver, Graham & Dunn PC, Seattle, for Appellant.

Stuart Charles Morgan, Jennifer Ann Wing, Eisenhower & Carlson, Tacoma, for Respondents.

ARMSTRONG, C.J.

The Millers leased cattle for their Michigan farm from T & W Financial Services Company, L.L.C., a leasing company headquartered in Washington and financed by Bank of America. When T & W became financially unstable, Bank of America purchased leases from T & W that the bank had held as collateral, including the Millers' lease. The Millers sued T & W in Michigan for failing to fully fund the lease. Then Bank of America sued the Millers in Washington for failing to pay their rent. The lease contained a forum selection clause providing that the parties would file any lawsuits in Washington and that Washington law would apply. The Washington trial court dismissed the bank's case on the Millers' motion, setting aside the forum selection clause and applying the forum non conveniens doctrine. Because the Millers failed to produce sufficient evidence to show that the forum selection clause is unreasonable and unfair and, thus, unenforceable, we reverse.

FACTS

Under the lease, T & W gave the Millers money to purchase cows and the Millers paid monthly rent. A representative from T & W in Iowa went to Michigan to negotiate and execute the lease agreement. T & W signed the lease in Washington and Millers sent their payments to T & W in Washington.

In March 2000, the Millers sued T & W in Michigan, alleging that T & W failed to provide all of the money it promised under the lease for the Millers to purchase cattle. Although the bank is not a party to that lawsuit, it retained a lawyer in Michigan and appeared there to contest a temporary injunction that relieved the Millers of their obligation under the lease. Then, in April 2000, Bank of America sued the Millers in Washington alleging default. The lease specified Pierce County, Washington as the agreed forum for resolving disputes arising from it. T & W filed a bankruptcy petition in Washington, which automatically stayed the Michigan lawsuit.

ANALYSIS

Bank of America challenges the trial court's conclusion that its lawsuit against the Millers should be tried in Michigan rather than Washington. It argues that the forum selection clause in the cattle lease is enforceable and that the trial court erred by applying forum non conveniens principles in the face of a valid forum selection clause.

The parties disagree as to the proper standard of review. Bank of America argues that de novo review is proper, while the Millers argue that we should review the trial court's decision for an abuse of discretion. In Exum v. Vantage Press, Inc., 17 Wash. App. 477, 479, 563 P.2d 1314 (1977), we reviewed for an abuse of discretion the trial court's decision not to enforce a contract provision naming New York as the forum. We found no abuse because "all contacts were made in Washington, partial performance was to be within the state, all the plaintiff's witnesses reside[d] within the State of Washington, [and] Defendant's Vice President who solicited Plaintiff reside[d] in California[.]" Exum, 17 Wash.App. at 479, 563 P.2d 1314. More recently, Division I, without discussing the standard of review, enforced an agreement to litigate in Nevada because the party challenging the agreement failed to "meet its burden of proving that the parties would be so seriously inconvenienced by litigation in Nevada that the clause must be found unreasonable or that the clause was obtained through unfair dealing." Voicelink Data Servs., Inc. v. Datapulse, Inc., 86 Wash.App. 613, 618, 937 P.2d 1158 (1997).

Here, as in Voicelink, the question is whether the Millers met their burden of proving that the forum selection clause should not be enforced. Regardless of whether we review this de novo or for an abuse of discretion, the Millers failed to carry their burden.

Courts will enforce a forum selection clause unless it is unfair or unreasonable. Exum, 17 Wash.App. at 478, 563 P.2d 1314. In deciding whether to dismiss a lawsuit because of a forum selection clause, the court does not accept the pleadings as true. Voicelink Data Servs., 86 Wash.App. at 618, 937 P.2d 1158. Rather, the party arguing that the forum selection clause is unfair or unreasonable bears a heavy...