SAI Ins. Agency, Inc. v. Applied Systems, Inc., 1D03-102C.

• Decision Date: 06 November 2003
• Docket Number: No. 1D03-102C.,1D03-102C.
• Citation: 858 So.2d 401
• Parties: SAI INSURANCE AGENCY, INC., a Florida corporation, d/b/a Southco, Insurance Services, Appellant, v. APPLIED SYSTEMS, INC., Appellee.
• Court: Florida District Court of Appeals

858 So.2d 401

SAI INSURANCE AGENCY, INC., a Florida corporation, d/b/a Southco, Insurance Services, Appellant, v. APPLIED SYSTEMS, INC., Appellee.

No. 1D03-102C.

District Court of Appeal of Florida, First District.

November 6, 2003.

Steven W. Bowden of Steven W. Bowden & Associates, P.A., Pensacola, for Appellant.

Thomas J. Gilliam, Jr. of Shell, Fleming, Davis & Menge, P.A., Pensacola, for Appellee.

KAHN, J.

May a trial court enforce a forum selection clause entered into between two parties to a contract when the effect of such clause is to require litigation of a claim brought under the Florida Deceptive and Unfair Trade Practices Act (DUTPA) in another state? In this case, the trial court enforced such a forum selection clause and dismissed the Florida action based upon the parties' agreement that Illinois would be the proper venue for any action. We affirm.

Appellant SAI Insurance Agency, Inc. (SAI) operates its commercial insurance business out of a principal office located in Crestview, Okaloosa County, Florida. Appellee Applied Systems, Inc. (Applied) does business in Florida, and maintains its principal office in Illinois. Applied offers software systems that it represents are useful for support services in companies such as SAI. In this case, SAI bought from Applied a software system for the purpose of calculating and tracking insurance premiums. Dissatisfied with the operation of the system, SAI filed a one-count suit in the circuit court for Okaloosa County, alleging violations of the Florida Deceptive and Unfair Trade Practices Act, Chapter 501, Part II, Florida Statutes. In reliance upon a clause in the Agreement for Purchase and Sale entered into between SAI and Applied, and attached to SAI's DUTPA complaint, Applied moved to dismiss the action on the ground of improper venue. The language relied upon by Applied appears in paragraph 12 of the Agreement for Purchase and Sale:

This Agreement is accepted at Applied Systems' home office and shall be governed by, and interpreted in accordance with, the laws of the State of Illinois. The parties consent to the sole and exclusive jurisdiction and venue of the state and federal courts of the State of Illinois for any action or claim between the parties.

As noted, the sole claim brought by SAI is based upon DUTPA. The sole remedy claimed by SAI is money damages, including costs, attorneys' fees, and interest.

SAI argues that Florida's public policy requires that any action brought under the Florida DUTPA be heard in a Florida court. According to SAI's argument, the right of a Florida citizen to litigate such a claim in a Florida court cannot be abrogated by a forum selection clause in a contract. In support of its argument, SAI relies upon Management Computer Controls, Inc. v. Charles Perry Construction, Inc., 743 So.2d 627 (Fla. 1st DCA 1999). SAI characterizes Management Computer as holding that mandatory venue clauses in contracts cannot be used as a defense to claims under DUTPA, because an unfair trade claim is an independent statutory action that does not arise out of the contract between the parties, nor does it exist solely for the benefit of the parties to the contract.

Applied responds that SAI's position would create a per se rule against the enforcement of forum selection clauses with respect to DUTPA claims. Applied also argues that Florida DUTPA claims may be litigated before, and interpreted by, courts outside the state of Florida. Finally, Applied points to the contract, and argues that the forum selection clause, which appellant has not sought to invalidate, applies to any action or claim between these parties and not just those arising from the Agreement.

In Management Computer, the plaintiff, Charles Perry, entered two contracts with Management Computer Controls to buy software for use in its Alachua County business. Management Computer was a Tennessee corporation. The contract contained the following governing law/venue provision:

1. GOVERNING LAW. Agreement is to be interpreted and construed according to the laws of the State of Tennessee. Any action, either by you or MC 2, arising out of this Agreement shall be initiated and prosecuted in the Court of Shelby County, Tennessee, and nowhere else; both you and MC 2 do hereby waive the right to change venue.

Mgmt. Computer, 743 So.2d at 629. Perry filed suit in Alachua County seeking damages in four counts: breach of contract, negligent misrepresentation, breach of implied warranty of fitness, and violation of the Florida DUTPA. Id. at 629-30. Relying upon the venue and choice of law provision in the contract, Management Computer moved to dismiss, claiming the action would be proper only in Shelby County, Tennessee. This court reviewed the question, which it characterized as "interpreting a contract," under the de novo standard of review. Id. at 630. Analyzing the question, this court stated, "[w]hether a venue clause is binding on the parties depends on its language." Id. at 631. As to the first three claims, this court concluded that each arose out of the contract, and thus would be governed by the parties' agreement concerning venue. Id. at 632. Turning to the DUTPA claim, however, this court concluded that it did not arise out of the contract and use of the venue clause as a defense to the statutory claim in that case would undermine the effectiveness of the statute. Id. at 632-33.

Applied does not dispute the correctness of Management Computer, but argues that the case does not establish, as a matter of Florida public policy, that a venue clause in a contract may never be enforced in the face of a claim under DUTPA. According to Applied, the Third District has recognized as much by its decision in World Vacation Travel, S.A., de C.V. v. Brooker, 799 So.2d 410 (Fla. 3d DCA 2001). The Brooker court found that enforcement of a forum selection clause in a contract for purchase of timeshare services in Mexico did not violate Florida's public policy. Id. at 412. The forum selection clause in Brooker applied to "any controversy or dispute in the interpretation of this agreement...." Id. at 411. The Third District reversed a circuit court finding that "enforcement of the forum selection clause as to any of the Brookers' claims would be violative of...