W.R. Millar Co. v. UCM Corp.

• Decision Date: 08 March 1988
• Docket Number: No. CX-87-1907,CX-87-1907
• Citation: 419 N.W.2d 852
• Parties: W.R. MILLAR CO., Appellant, v. UCM CORPORATION, Respondent.
• Court: Minnesota Court of Appeals

Page 852

419 N.W.2d 852

W.R. MILLAR CO., Appellant, v. UCM CORPORATION, Respondent.

No. CX-87-1907.

Court of Appeals of Minnesota.

March 8, 1988.

Syllabus by the Court

A subsequent contract, which is independent and does not cover the same subject matter as a prior agreement, does not supersede or substitute for the earlier contract absent an express provision to that effect.

Roy S. Ginsburg, Henson & Efron, Minneapolis, for appellant.

Wood R. Foster, Jr., Grossman Karlins Siefel, Brill & Greupner, Minneapolis, for respondent.

Heard, considered and decided by RANDALL, P.J., and LANSING and MULALLY, ^* JJ.

OPINION

RANDALL, Presiding Judge.

This appeal is from a trial court order granting respondent's motion to dismiss appellant's complaint for lack of personal or subject matter jurisdiction. We reverse.

FACTS

In September 1984 appellant, as an independent distributor, secured an order from Target Stores for 30,000 cassette players. To fill the order, appellant purchased 30,000 cassette players directly from respondent. In October 1984 the parties entered into another contract where appellant, in the capacity of a manufacturer's representative, agreed to sell electronic goods for respondent.

Acting as an independent distributor pursuant to the September 1984 contract, appellant bought the cassette players with a foreign letter of credit and took title to them. Appellant was responsible for importing the goods and paying all import duties, freight, and shipping costs. He also determined the sale price of the players. Any profit appellant earned resulted from the sale of the goods at a higher price than appellant paid respondent. On the other hand, as a sales representative under the second contract, appellant's function was to secure orders for respondent's products. Title to the goods passed directly from respondent to the retail outlet customer. Appellant had no importing, shipping or billing responsibilities, nor any authority to set prices. Appellant earned a commission after orders were placed, accepted, shipped, and billed.

The October 1984 contract (the one referred to as the second) contained the following forum-selection provision:

This Agreement is entered into in Los Angeles, California and shall be governed by the laws of the State of California. As a material inducement to [respondent] to enter into this Agreement, [appellant] agrees that at [respondent's] option, any action or proceeding based upon or arising out of this agreement shall be conducted exclusively in the courts located in Los Angeles County California, and [appellant] irrevocably consents to the jurisdiction of any such court and waives any right to change the venue of any such action or proceeding.

The agreement also included an integration clause:

This Agreement represents the entire agreement between the parties with respect to the sale of products, supersedes all prior agreements and understandings with respect thereto and may only be modified or amended in writing signed by duly authorized representatives of both parties.

The agreement did not mention the September cassette order. Subsequent to the signing of this second agreement, Target informed appellant it was unable to sell approximately 8,800 of the cassette recorders (subject of the earlier contract between the parties) and asked to return them. The parties had several discussions throughout 1985 on who would be responsible for the loss. Respondent authorized the return of 1,073 units, but only gave appellant credit for 797 of them.

In January 1987 appellant sued respondent in Hennepin County district court. Appellant claimed respondent violated an oral contract arising out of their 1985 discussions, and claimed that he should be reimbursed by respondent for losses sustained on the returned cassette players.

Respondent brought a motion to dismiss, claiming Hennepin County district court lacked jurisdiction based on the October 1984 contract provision limiting jurisdiction to Los Angeles County. The trial court agreed and found appellant contractually bound by the forum-selection clause in the second contract. The court held that a Minnesota district court has neither personal nor subject matter jurisdiction over respondent.

ISSUE

Did the trial court err by determining that the forum-selection clause in the parties' October 1984 agreement prevented appellant from bringing suit in Minnesota over a dispute arising from the September 1984 cassette player order?

ANALYSIS

Appellant argues that the forum-selection clause does not apply to the dispute brought in Hennepin district court. Appellant claims that the parties' two contracts were for distinct and independent services, making the forum-selection clause in the second contract irrelevant to controlling disputes arising out of the earlier contract. We agree. The September 1984 contract covered the purchase of 30,000 cassette recorders by appellant acting as an independent distributor. However, the October 1984 contract established a sales representative relationship between the parties, and did not incorporate the earlier contract. Appellant properly contends that only claims arising out of its role as a sales representative (which are not an issue in this dispute) must be litigated in Los Angeles County.

Appellant acted as an independent distributor for the parties' first transaction. The second transaction established appellant as a sales representative for respondent. As a sales representative, ...