NICOLE TURCHECK V AMERIFUND FINANCIAL INC
Annotate this Case
Download PDF
STATE OF MICHIGAN
COURT OF APPEALS
NICOLE TURCHECK,
FOR PUBLICATION
October 3, 2006
9:05 a.m.
Plaintiff-Appellant,
v
AMERIFUND FINANCIAL, INC., d/b/a ALLFUND MORTGAGE,
Defendant-Appellee.
No. 269248
Wayne Circuit Court
LC No. 05-533831-CK
Official Reported Version
Before: Borrello, P.J., and Jansen and Cooper, JJ.
PER CURIAM.
Plaintiff appeals as of right the circuit court order dismissing her complaint without
prejudice on the basis of a forum-selection clause in the parties' contract. We affirm. This
appeal is being decided without oral argument. MCR 7.214(E).
I. Facts
Plaintiff was employed as a branch manager by defendant, a Washington corporation,
pursuant to an employment contract. The contract contained both a choice-of-law provision and
a forum-selection provision:
This agreement shall be subject to and governed by the laws of
Washington, irrespective of the fact that a party is or may become a resident of a
different state.
* * *
Both parties hereby agree that the Circuit Court of Pierce County, State of
Washington, shall have the exclusive jurisdiction to hear and determine any and
all disputes, controversies, or claims arising out of, or relating to this Agreement,
or concerning the respective rights of the parties hereunder and, for such
purposes, do hereby submit themselves to the sole personal jurisdiction of that
Court.
-1-
Plaintiff brought this action in the Wayne Circuit Court, alleging that defendant failed to pay
commissions that she was owed under the contract. Defendant argued that, in light of the forumselection clause, plaintiff should have brought this action in the state of Washington.
Plaintiff asserted that the forum-selection clause was unenforceable pursuant to MCL
600.745(3), which provides in pertinent part:
If the parties agreed in writing that an action on a controversy shall be
brought only in another state and it is brought in a court of this state, the court
shall dismiss or stay the action, as appropriate, unless any of the following occur:
* * *
(c) The other state would be a substantially less convenient place for the
trial of the action than this state.
(d) The agreement as to the place of the action is obtained by
misrepresentation, duress, the abuse of economic power, or other unconscionable
means.
(e) It would for some other reason be unfair or unreasonable to enforce the
agreement.
Defendant suggested that the forum-selection clause was enforceable under MCL 600.745(3),
and that, in the alternative, Washington law should apply to determine the enforceability of the
contract's forum-selection clause.
The trial court observed that "[p]eople are free to bargain for the [forum] where any
dispute will be litigated and [plaintiff] did so . . . ." Having found that plaintiff freely consented
to the forum-selection provision, and that the provision did not fall within any of the MCL
600.745(3) exceptions, the trial court enforced the forum-selection clause and dismissed the
action without prejudice.1
II. Forum-Selection Clause
Plaintiff argues that the trial court erred in dismissing this action pursuant to the forumselection clause in the parties' contract. We disagree.
1
Contrary to plaintiff 's assertion, the trial court did not dismiss this case for improper venue.
-2-
A. Standard of Review
Michigan courts have not precisely identified the proper standard for reviewing a trial
court's dismissal based on a forum-selection clause. Both parties contend on appeal that a trial
court's dismissal of an action pursuant to a contractual forum-selection clause should be
reviewed de novo.
While not identical, dismissal based on a forum-selection clause is similar to a grant of
summary disposition for lack of personal jurisdiction. Although a valid forum-selection clause
does not divest the Michigan courts of personal jurisdiction over the parties, it evinces the
parties' intent to forgo personal jurisdiction in Michigan and consent to exclusive jurisdiction in
another forum. See James v Midland Co Agricultural & Horticultural Society, 107 Mich App 1,
5; 308 NW2d 688 (1981). Indeed, forum-selection clauses are inherently bound up with notions
of personal jurisdiction. See id. Of note, the Michigan forum-selection statute, MCL
600.745(3), is itself contained among the jurisdictional provisions of the Revised Judicature Act.
This Court reviews de novo a trial court's grant of summary disposition, as well as a trial court's
jurisdictional rulings. Electrolines, Inc v Prudential Assurance Co, Ltd, 260 Mich App 144, 152;
677 NW2d 874 (2003).
Moreover, a dismissal based on a forum-selection clause necessarily requires
interpretation and application of contractual language. The legal effect of a contractual clause is
a question of law that we review de novo. Quality Products & Concepts Co v Nagel Precision,
Inc, 469 Mich 362, 369; 666 NW2d 251 (2003).
In light of the above authority and the contractual nature of forum-selection provisions,
we are convinced that a trial court's dismissal of an action pursuant to a contractual forumselection clause is properly reviewed on appeal under a de novo standard.
B. Analysis
We begin with Michigan's fundamental rules of contract interpretation, set forth by our
Supreme Court in Quality Products & Concepts, supra:
In interpreting a contract, our obligation is to determine the intent of the
contracting parties. If the language of the contract is unambiguous, we construe
and enforce the contract as written. Thus, an unambiguous contractual provision
is reflective of the parties' intent as a matter of law. Once discerned, the intent of
the parties will be enforced unless it is contrary to public policy. [Id. at 375
(internal citations omitted).]
It is undisputed that Michigan's public policy favors the enforcement of contractual forumselection clauses and choice-of-law provisions. See Offerdahl v Silverstein, 224 Mich App 417,
419; 569 NW2d 834 (1997) (recognizing the enforceability of forum-selection clauses and
choice-of-law provisions). Thus, assuming that certain exceptions do not apply, Michigan courts
will enforce an express forum-selection clause as written. MCL 600.745(3). Similarly, the
Michigan courts will enforce contractual choice-of-law provisions if certain conditions are met.
-3-
Chrysler Corp v Skyline Industrial Services, Inc, 448 Mich 113, 126-127; 528 NW2d 698
(1995); Martino v Cottman Transmission Systems, Inc, 218 Mich App 54, 60-61; 554 NW2d 17
(1996).
The analysis grows more complicated, however, when a single agreement contains both a
forum-selection clause and a choice-of-law provision. When a party to such an agreement sues
in a state that is not designated by either the forum-selection clause or the choice-of-law
provision, it becomes necessary to determine which state's law will govern the enforceability of
the forum-selection clause itself. In other words, the trial court where the action is filed must
decide whether to determine the enforceability of the forum-selection clause by applying its own
law, or by applying the law designated in the choice-of-law provision.2
In the case at bar, the parties designated the state of Washington in the forum-selection
clause and Washington state law in the choice-of-law provision. Notwithstanding these
provisions, plaintiff filed suit in Michigan. Therefore, in order to decide whether to exercise or
decline jurisdiction, it was essential for the trial court to determine whether the forum-selection
clause was valid and enforceable. Accordingly, under ordinary circumstances, the trial court
would have been required to first determine whether Michigan or Washington law governed the
forum-selection clause's enforceability.3
2
Such a decision necessarily requires the court to first determine under its own law whether the
contractual choice-of-law provision is itself enforceable. See Beilfuss v Huffy Corp, 274 Wis 2d
500, 506-507; 685 NW2d 373 (Wis App, 2004) (describing the decision whether to construe a
contract's forum-selection clause and choice-of-law provision together or independently as "the
classic conundrum"). We have previously determined that Michigan courts have the initial
jurisdiction to "determine the threshold issue whether a party is bound by a contract, and,
accordingly, any forum selection and choice-of-law provision in the contract." Offerdahl, supra
at 420; see also Blackburne & Brown Mortgage Co v Ziomek, 264 Mich App 615, 621-622; 692
NW2d 388 (2004). However, this Court has never specifically addressed whether such an initial
determination should be made pursuant to Michigan law or, alternatively, pursuant to the law
designated in the contract's choice-of-law provision.
3
Michigan courts have never squarely addressed whether the enforceability of a contractual
forum-selection clause should be governed by the law of the state where the action was filed, or
in the alternative, the law selected by the parties in the choice-of-law provision. However,
courts in several other jurisdictions have addressed this matter. Many jurisdictions follow the
rule that, provided the choice-of-law provision is enforceable under the law of the state where
the action was filed, the law selected in the choice-of-law provision will govern the applicability
or enforceability of the forum-selection clause. The rationale for this view is that the parties
contracted for the law of a specific jurisdiction, and therefore the law of the state where the
action was filed should not be applied to displace the contractually chosen law. See Jacobsen
Construction Co v Teton Builders, 106 P3d 719, 723 (Utah, 2005); Szymczyk v Signs Now Corp,
168 NC App 182, 187; 606 SE2d 728 (2005); Jacobson v Mailboxes Etc USA, Inc, 419 Mass
(continued…)
-4-
However, because we determine that the forum-selection clause in the parties' contract
would have been equally enforceable under either Michigan law or Washington law, we need not
decide which state's law would otherwise have governed the clause's applicability.4
As noted earlier, Michigan courts generally enforce contractual forum-selection clauses.
MCL 600.745(3); Offerdahl, supra at 419. The exceptions to this rule are stated in MCL
600.745(3)(a)-(e), and unless one of the statutory exceptions applies, Michigan courts will
enforce a forum-selection clause as written. The statutory exceptions that are relevant in this
case provide that a forum-selection clause should be enforced unless "[t]he other state would be
a substantially less convenient place for the trial[,]" "[t]he agreement as to the place of the action
is obtained by misrepresentation, duress, the abuse of economic power, or other unconscionable
means[,]" or "[i]t would for some other reason be unfair or unreasonable to enforce the
agreement." MCL 600.745(3)(c)-(e). A party seeking to avoid a contractual forum-selection
clause bears a heavy burden of showing that the clause should not be enforced. The Bremen v
Zapata Off-Shore Co, 407 US 1, 17-18; 92 S Ct 1907; 32 L Ed 2d 513 (1972). Accordingly, the
party seeking to avoid the forum-selection clause bears the burden of proving that one of the
statutory exceptions of MCL 600.745(3) applies.
Our research has revealed that the standards for enforcing contractual forum-selection
provisions under Washington law are substantially similar. In general, Washington state courts
will enforce a forum-selection clause unless it is unreasonable, unjust, or unfair. Voicelink Data
(…continued)
572, 575; 646 NE2d 741 (1995); Cerami-Kote, Inc v Energywave Corp, 116 Idaho 56, 58; 773
P2d 1143 (1989); see also Parsons Dispatch, Inc v John J Jerue Truck Broker, Inc, 89 Ark App
25; 199 SW3d 686 (2004) (assuming that Florida law, as designated by the choice-of-law
provision, governed the enforceability of the forum-selection clause); Eisaman v Cinema Grill
Systems, Inc, 87 F Supp 2d 446, 448 (D Md, 1999) (federal district court sitting in diversity
applying Georgia law, as designated by the choice-of-law provision, to determine the
enforceability of a forum-selection clause). In contrast, certain jurisdictions follow the rule that
a contract's forum-selection clause is to be read independently of the choice-of-law provision,
and that the validity of the forum-selection clause will always be determined according to the
law of the jurisdiction where the action was filed. This rule is based on the notion that because
choice-of-law provisions only require application of the chosen state's substantive law, the state
where the action was filed remains free to apply its own law on matters of procedure, including
the question whether the forum-selection clause is valid in the first place. See Golden Palm
Hospitality, Inc v Stearns Bank Nat'l Ass'n, 874 So 2d 1231, 1234-1235 (Fla App, 2004)
(adhering to the view that Florida law governs the enforceability of forum-selection clauses,
even when the contract contains a choice-of-law provision favoring the law of another
jurisdiction); see also Fendi v Condotti Shops, Inc, 754 So 2d 755, 757-758 (Fla App, 2000);
Yamada Corp v Yasuda Fire & Marine Ins Co, Ltd, 305 Ill App 3d 362, 367-368; 712 NE2d 926
(1999) (applying Illinois law instead of the contractually chosen Japanese law to determine
validity of the forum-selection clause).
4
See Morgan Bank (Delaware) v Wilson, 164 Ariz 535, 538; 794 P2d 959 (Ariz App, 1990)
("we believe that under either Arizona or Kentucky law, the result is the same in the present
case, and therefore do not decide which law applies").
-5-
Services, Inc v Datapulse, Inc, 86 Wash App 613, 617-618; 937 P2d 1158 (1997). "[T]he party
arguing that the forum selection clause is unfair or unreasonable bears a heavy burden of
showing that trial in the chosen forum would be so seriously inconvenient as to deprive the party
of a meaningful day in court." Bank of America, NA v Miller, 108 Wash App 745, 748; 33 P3d
91 (2001). "Absent evidence of fraud, undue influence, or unfair bargaining power, courts are
reluctant to invalidate forum selection clauses as they increase contractual predictability." Id.,
citing Voicelink Data Services, supra at 617; see also Wilcox v Lexington Eye Institute, 130
Wash App 234, 239; 122 P3d 729 (2005).
Turning to the case at bar, defendant presented affidavits stating that the witnesses and
voluminous employment records needed to defend this action are located in Washington.
Moreover, defendant's affidavits showed that only a minimal amount of relevant evidence is
located in Michigan. Plaintiff asserted that most of her witnesses reside in Michigan, that the
pertinent transactions took place in Michigan, and that certain factual information concerning the
case is located in Michigan. However, plaintiff failed to present admissible documentary
evidence supporting any of these assertions. Plaintiff also claimed that the contract was obtained
through abuse of economic power, inasmuch as defendant is a large corporation and she is a
mere individual who was unable to negotiate the terms of the contract at the time the agreement
was executed. Again, however, plaintiff failed to present evidence to support her assertions that
defendant wielded unfair bargaining power or that the clause was not subject to negotiation.
Under the law of both Michigan and Washington, plaintiff 's unsupported allegations were
inadequate to meet her burden of showing that enforcement of the forum-selection clause would
have been unreasonable, unjust, substantially inconvenient, or unfair. The Bremen, supra at 1718; Bank of America, supra at 748; see also 1 Restatement Conflict of Laws, 2d (1988
Revisions), § 80, comment c, p 85 ("[t]he burden of persuading the court that stay or dismissal of
the action would be unfair or unreasonable is upon the party who brought the action").
Moreover, the claimed inconvenience of litigating in Washington should have been
apparent to plaintiff when she agreed to the forum-selection clause. Like the Washington Court
of Appeals and the United States Supreme Court, we conclude that inconvenience, insofar as it is
within the contemplation of the parties at the time of contracting, should not render a forumselection clause unenforceable. The Bremen, supra at 16-17; Bank of America, supra at 748749. Where the inconvenience of litigating in another forum is apparent at the time of
contracting, that inconvenience is part of the bargain negotiated by the parties. Allowing a party
who is disadvantaged by a contractual choice of forum to escape the unfavorable forum-selection
provision on the basis of concerns that were within the parties' original contemplations would
unduly interfere with the parties' freedom to contract and should generally be avoided.
III. Attorney Fees
Defendant also asserts that it is entitled to attorney fees incurred in defending this action,
including the appeal. Defendant asserted its claim for attorney fees below, but the trial court
denied the request. Although filing a cross-appeal is not necessary to argue an alternative basis
for affirming the trial court's decision, the failure to do so generally precludes an appellee from
raising an issue not appealed by the appellant. Kosmyna v Botsford Community Hosp, 238 Mich
-6-
App 694, 696; 607 NW2d 134 (1999). Defendant's failure to file a cross-appeal from the trial
court's denial of its request for attorney fees precludes it from now attempting to obtain a
decision more favorable than that rendered below. Middlebrooks v Wayne Co, 446 Mich 151,
166 n 41; 521 NW2d 774 (1994).
IV. Conclusion
Similar to a dismissal for lack of jurisdiction, see MCR 2.504(B)(3), a dismissal based on
a contractual forum-selection clause is not an adjudication on the merits. Therefore, such a
dismissal is properly characterized as a dismissal without prejudice. See ABB Paint Finishing,
Inc v Nat'l Union Fire Ins Co of Pittsburgh, 223 Mich App 559, 563; 567 NW2d 456 (1997).
Affirmed.
/s/ Stephen L. Borrello
/s/ Kathleen Jansen
/s/ Jessica R. Cooper
-7-
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.