Equipment Leasing Co. v. Talbot Homes, Inc.

By JUDGE JACK B. STEVENS This matter has been under advisement by the Court to consider the defendant, Talbot Homes’s Demurrer to the Motion for Judgment. The Demurrer argues that bringing this suit in Virginia is contrary to a law and forum selection clause in the lease between the parties. The Court has considered the arguments of counsel, as well as the cases submitted, and sustains the Demurrer. Virginia conflicts of law rules generally honor contractual choice of law provisions. Thornhill v. Donnkenny, Inc., 823 F.2d 782 (4th Cir. 1987). Additionally, the current view of forum selection agreements, in light of present-day commercial realities, is that forum selection clauses should control, absent a strong showing that it should be set aside. Gordonsville Industries v. American Artos Corp., 549 F. Supp. 200 (W.D. Va. 1982). Paragraph 22 of the lease, entitled "LEGAL MATTERS," is a typical choice of law and forum selection clause, designed to articulate what law and forum should govern the parties, should conflict regarding the lease arise. In pertinent part, the paragraph reads as follows: LEGAL MATTERS: MD. law shall govern the execution, performance and construction of this Lease. All other shall be governed in accordance with MD. law and shall be accepted and deemed entered [126] into within the State of MD. The LESSEE and guarantor(s) hereby submit to the jurisdiction of the Courts of the State of MD. and agree with LESSOR that personal jurisdiction of the LESSEE and guarantor(s) shall rest with the Courts of the State of MD. for purposes of any action on or related to this Lease, the liabilities, or the enforcement of the same. (Emphasis added.) The clear meaning of Paragraph 22 is to confer jurisdiction upon the courts of Maryland to resolve all legal conflicts arising from this lease. The contract was drafted by Equipment Leasing Company and signed by representatives of both parties. Equipment Leasing Company has not put forth any basis that the Court considers would constitute strong support why this clause in its own standard contract should not be given effect. Accordingly, the law and forum selection clause is upheld.