In re Laibe Corp.
| Citation | 307 SW 3d 314 |
| Decision Date | 26 March 2010 |
| Docket Number | No. 09-0426.,09-0426. |
| Parties | In re LAIBE CORPORATION, Relator. |
| Court | Supreme Court of Texas |
David W. Whitehurst, Frank Gerhardt Cawley, Whitehurst & Cawley, L.L.P., Addison, TX, for Relator.
William K. Clary, William K. Clary, P.C., Bridgeport, TX, Andrew D. Sims, Elizabeth Hampson Moore, Harris Finley & Bogle, P.C., Fort Worth, TX, for Real Party in Interest.
Laibe Corporation seeks a writ of mandamus to enforce a contractual forum-selection clause. We conditionally grant the writ.
Laibe entered into a contract to sell a drilling rig to Jackson Drilling Services, L.P. A New Equipment Purchase Contract, prepared by Laibe and dated March 10, 2006, contains the following forum-selection clause:
Jackson Drilling had problems with the rig and sued Laibe in Wise County, Texas district court. Jackson Drilling alleged that the rig's hydraulic pump malfunctioned and that repair and warranty work performed by Laibe was substandard. The petition sought a declaratory judgment and damages for deceptive trade practices, fraud, and breach of contract.
Laibe filed a motion to dismiss on grounds that the forum-selection clause compelled suit in Indiana. The trial court denied the motion after a hearing. Because Jackson Drilling had not filed a response to the motion to dismiss until the day of the hearing, Laibe filed a motion to reconsider providing additional evidence and argument. This motion was denied by an order signed on December 19, 2008, and filed on December 22, 2008.
On March 23, 2009, Laibe filed a mandamus petition in the court of appeals, which denied relief in a three-sentence memorandum opinion. Laibe then sought mandamus relief in this Court.
A writ of mandamus will issue if the trial court committed a clear abuse of discretion for which the relator has no adequate remedy at law. In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135-36 (Tex.2004) (orig. proceeding). This Court has repeatedly granted mandamus relief to enforce forum-selection clauses. In re ADM Investor Servs., Inc., 304 S.W.3d 371 (Tex.2010) (orig. proceeding); In re Int'l Profit Assocs., Inc., 274 S.W.3d 672 (Tex. 2009) (orig. proceeding); In re Lyon Fin. Servs., Inc., 257 S.W.3d 228 (Tex.2008) (orig. proceeding); In re AutoNation, Inc., 228 S.W.3d 663 (Tex.2007) (orig. proceeding); In re Automated Collection Techs., Inc., 156 S.W.3d 557 (Tex.2004) (orig. proceeding); In re AIU Ins. Co., 148 S.W.3d 109 (Tex.2004) (orig. proceeding). We have granted mandamus relief in these cases "because a trial court that improperly refuses to enforce such a clause has clearly abused its discretion," ADM Investor Servs., 304 S.W.3d at 374, and because "there is no adequate remedy by appeal when a trial court refuses to enforce a forum-selection clause," id. at 376.
Forum-selection clauses are generally enforceable and presumptively valid. Int'l Profit Assocs., 274 S.W.3d at 675, 680. A trial court abuses its discretion in refusing to enforce the clause unless the party opposing enforcement clearly shows "(1) enforcement would be unreasonable or unjust, (2) the clause is invalid for reasons of fraud or overreaching, (3) enforcement would contravene a strong public policy of the forum where the suit was brought, or (4) the selected forum would be seriously inconvenient for trial." ADM Investor Servs., 304 S.W.3d at 375. "The burden of proof is heavy for the party challenging enforcement." Id.
Jackson Drilling argues that enforcement of the clause would be unreasonable and unjust because the sale of the drilling rig was the subject of a January 10, 2006 invoice that did not contain a forum-selection clause. The invoice in the record is unsigned although it has a signature line. However, Doug Jackson, a Jackson Drilling manager/partner, testified at the hearing on the motion to dismiss that he signed a copy of the invoice. Jackson Drilling further points out that, pursuant to the terms of the invoice, it made a $75,000 deposit before the March 10, 2006 New Equipment Purchase Contract containing the forum-selection clause. The later agreement is signed by Doug Jackson twice, once on behalf of Jackson Drilling and once as an individual guarantor. Jackson testified that he could not remember signing the later contract, but answered "no" when asked whether he was "stating under oath that it is not your signature."
The later agreement containing the forum-selection clause also contains a standard merger clause stating that "this Contract is the entire agreement" of the parties and "no other oral or written agreements, terms or promises" shall be binding. The merger clause thus indicates that the invoice on which Jackson Drilling relies is not the final and binding agreement of the parties. Even if, for some reason, the merger clause is disregarded for purposes of Jackson Drilling's argument, a contract can consist of more than one document. Documents "pertaining to the same transaction may be read together," even if they are executed at different times and do not reference each other, and "courts may construe all the documents as if they were part of a single, unified instrument." Fort Worth Indep. Sch. Dist. v. City of Fort Worth, 22 S.W.3d 831, 840 (Tex.2000). Here, the two writings pertained to the same transaction. Jackson Drilling's own petition alleged that it purchased the rig "on or about March 10, 2006," the date of the agreement containing the forum-selection clause.
Insofar as Jackson Drilling contends the later agreement added new terms, including the forum-selection clause, that modified a finalized and preexisting contract set out in the earlier invoice, this argument is inconsistent with the merger clause described above. Moreover, under the Uniform Commercial Code, an agreement modifying a contract for the sale of goods requires no new consideration to be binding. TEX. BUS. & COM.CODE § 2.209(a). Further, we have held that a forum-selection clause like the one at issue does not require mutuality of obligation so long as the contract as a whole provides consideration. Lyon Fin. Servs., 257 S.W.3d at 233. Here, the contract as a whole did not lack for consideration; it was a routine sale of equipment between two business entities, with one party providing consideration in the form of goods and the other part...
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