Prosperous Maritime Corp. v. Farwah

While a Texas court may enforce a valid forum-selection clause and thereby require the parties to litigate their dispute in the jurisdiction agreed to by the parties, the existence of a forum-selection clause does not generally deprive the forum of jurisdiction over parties.

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Click here for the full text of this decision FACTS:Several crew members from a foreign oil tanker traveled into Port Arthur. They went with Fredesvinda Seagler, who was selling phone cards in the ship terminal, and she shuttled them around town. At one point, when Seagler returned to pick the men up, Juan Esparza, whom the crew members had not met previously, was driving and Seagler was in the front seat. Another car crashed into the car and one of the passengers, Ravinderpal Farwah, was killed. Farwah’s wife, children and parents sued several defendants, including Prosperous Maritime Corp. and OCS Services (India) Ltd., neither of who are Texas residents. The trial court heard Prosperous’ and OCS’ special appearances, but denied them. The trial court vacated its initial findings and fact and conclusions of law. HOLDING:Affirmed in part; dismissed in part. Though not raised by the defendants, the court notes that the special appearances they filed were unsworn. Noting that Texas Rule of Appellate Procedure 120a requires a special appearance to be made by sworn motion, the court rules that a trial court does not err in denying a special appearance when it does not strictly comply with Rule 120a. The court acknowledges that there is potential harm to both parties by either applying or ignoring the rule requirements: The plaintiffs will be harmed if a trial court order that is technically correct is nonetheless reversed; the defendants will be harmed because they will be deprived of the right to cure their mistake before making a general appearance. “Because Prosperous’s and OCS’s special appearances were not sworn, we conclude the trial court did not err in denying their special appearances. We note that Rule 120a appears to permit amendments to cure defects, although we expressly do not decide whether an amendment can cure the defect under the circumstances here, as that issue has not been briefed or argued before the trial court or on appeal. Likewise, there appears to be no obstacle to the Farwahs’ development of a more complete record regarding the jurisdictional issue in the event the defendants pursue another hearing on amended and sworn special appearances.” The court next addresses an argument by Prosperous and OCS that the trial court refused to enforce a forum-selection clause that names Bombay, India, as the situs to resolve disputes with members of the Maritime Union of India. The court finds that, while Texas may enforce a valid forum-selection clause, the existence of a forum-selection clause does not general deprive the forum of jurisdiction over the parties. Here, the trial court’s written order denying relief to Prosperous and OCS did not expressly provide for appellants to have a right to appeal the denial of their motions to dismiss, which were based on the forum-selection clause. OPINION:Horton, J.; McKeithen, C.J., Gaultney and Horton, JJ.

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