Union Electric Co. v. Energy Ins. Mutual, No. 11-1315 (8th Cir. 2012)
Annotate this CaseIn a diversity action involving an insurance dispute, Union Electric appealed the district court's grant of EIM's motion to dismiss. Union Electric is a Missouri Utility and EIM is a mutual insurance company incorporated in Barbados and with a principal place of business in Florida. At issue was an insurance contract, which specified that New York law applied, which was drafted by the member insureds, in contrast to the insurer-drafted contracts commonly found in insurance disputes. While the district court correctly determined that M/S Bremen v. Zapata Off-Shore Co. provided the standard for evaluating a motion to dismiss based on a contractual forum selection clause, the court reversed and remanded for the district court to consider in the first instance whether Missouri's public policy against the enforcement of mandatory arbitration provisions invalidated the forum selection clause.
Court Description: Civil case - Insurance. In action seeking insurance coverage for damage caused by a breach of the Taum Sauk upper reservoir, the district court correctly determined that the M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1 (1972) provides the standard for evaluating a motion to dismiss based on a contractual forum selection clause; however, the district court's failure to address Missouri's public policy concerning mandatory arbitration provisions in insurance contracts constituted an abuse of discretion, and the matter is reversed and remanded with directions to the district court to consider in the first instance whether Missouri's public policy against enforcement of the mandatory arbitration provisions is sufficient to invalidate the forum selection clause under Bremen.
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