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The Bremen v. Zapata Off-Shore Co.

Supreme Court of the United States

March 21, 1972, Argued ; June 12, 1972, Decided

No. 71-322

Case Summary

Procedural Posture

Petitioner sought review by certiorari of the judgment entered by the United States Court of Appeals for the Fifth Circuit in which a forum-selection clause in a contract between petitioner German corporation and respondent United States corporation was held invalid.

Overview

The German corporation contracted with the United States corporation to transport an oil rig from Louisiana to the Adriatic Sea. During transportation, the rig was damaged and was towed to Tampa, Florida, where the United States corporation filed suit. The German corporation, however, asked the district court to enforce the forum-selection clause contained in the contract placing jurisdiction in England. The district court refused to enforce the clause and the lower appellate court affirmed. Reversing the lower appellate court's judgment, the court held that the forum-selection clause should be enforced unless the party resisting the clause could show that enforcement would be unreasonable. Furthermore, the court held that the argument that such clauses ousted a court of jurisdiction was not valid, and the German corporation did not waive operation of the clause by appearing in the federal court. As a result, the court held that the forum-selection clause was valid and the case was remanded for a determination of whether enforcement was unreasonable.

Outcome

The court vacated the lower appellate court's judgment and remanded the case for a determination of whether enforcement of the forum-selection clause was unreasonable.

LexisNexis® Headnotes

 

 

Admiralty & Maritime Law > Practice & Procedure > Forum Selection

Business & Corporate Compliance > ... > Contracts Law > Contract Conditions & Provisions > Forum Selection Clauses

HN1  Practice & Procedure, Forum Selection

Forum-selection clauses are prima facie valid and should be enforced unless enforcement is shown by the resisting party to be unreasonable under the circumstances. This is the correct doctrine to be followed by federal district courts sitting in admiralty.

 

Admiralty & Maritime Law > Practice & Procedure > Forum Selection

Business & Corporate Compliance > ... > Contracts Law > Contract Conditions & Provisions > Forum Selection Clauses

Business & Corporate Compliance > ... > Contract Conditions & Provisions > Waivers > Notice

HN2  Practice & Procedure, Forum Selection

Parties to a contract may agree in advance to submit to the jurisdiction of a given court, to permit notice to be served by the opposing party, or even to waive notice altogether.

 

Admiralty & Maritime Law > Practice & Procedure > Forum Selection

Business & Corporate Compliance > ... > Contracts Law > Contract Conditions & Provisions > Forum Selection Clauses

International Trade Law > Dispute Resolution > International Commercial Arbitration > Arbitration

HN3  Practice & Procedure, Forum Selection

Where the choice of a forum was made in an arm's-length negotiation by experienced and sophisticated businessmen, absent some compelling and countervailing reason, it should be honored by the parties and enforced by the courts.

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407 U.S. 1 ; 92 S. Ct. 1907 ; 32 L. Ed. 2d 513 ; 1972 U.S. LEXIS 114 

THE BREMEN ET AL. v. ZAPATA OFF-SHORE CO.

Prior History:  [1]  CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT.

Disposition:  428 F.2d 888 and 446 F.2d 907, vacated and remanded.