Delaware holds that mothers signature on contract forces change of venue for minors claims.

Doe v. Cedars Academy, LLC, 2010 Del. Super. LEXIS 559

Court recognizes that you can’t argue rights under the contract and void other parts of the contract in the same lawsuit.

This case alleges that the minor was assaulted at a school for students who have a need for academic and social skills development. To be enrolled in the school the mother had to sign a substantial contract. The contract included a release of liability (pre-injury release) and a venue and jurisdiction clause.

The minor was allegedly threatened and sexually assaulted by another student. The mother and son sued for.

“….negligence, gross negligence, and recklessness; one count raises a breach of contract claim, and one count raises a claim that Defendants violated John Doe’s substantive due process right to bodily integrity.”

The defendants, the school and the parent company of the school moved to dismiss the complaint for lack of personal jurisdiction. This means the contract says the jurisdiction is located in another state, therefor this court does not have the legal right to hear the claim. i.e. the jurisdiction clause in the contract between the parties.

Summary of the case

The school was located in Delaware; however, the agreement required arbitration in California. The venue and jurisdiction clause was extensive in the contract.

21. Governing Law/Venue: This Agreement, and all matters relating hereto, including any matter or dispute arising between the parties out of this Agreement, tort or otherwise, shall be interpreted, governed and enforced according to the laws of the State of California; and the parties consent and submit to the exclusive jurisdiction and venue of the California Courts in Los Angeles County, California, and any qualified (American Arbitration Association-approved) arbitration service in the State of California, County of Los Angeles, to enforce this Agreement. The parties acknowledge that this Agreement constitutes a business transaction within the State of California. 10

The court looked at four issues in reviewing the contract and the claims of the plaintiffs:

(A) whether the Agreement is binding as to Jane Doe; [the mother]

(B) whether the Agreement is binding as to John Doe; [the son]

(C) whether the pre-injury release provision renders the entire Agreement unenforceable; and, if not

(D) whether the choice of law, choice of forum, and/or arbitration provisions of the Agreement are controlling.

The issue of whether the contract is binding on the mother. The court found it was because the mother also sued for damages under the contract. Here the court found if you are suing for damages under the contract, you cannot claim you are not part of the contract.

The court also held, in what was one of the clearest statements on this issue I’ve read, that the mother could not avail herself of the services of the defendant and put her son in the school and then claim the contract did not apply to her. If the contract allowed her to put her son in the school, then the contract applied to her.

But for the right to contact as a mother, there would be no services for children.

This same analysis was applied to whether or not the minor was bound by the agreement. If the minor could attend the school, based on the contract, then the minor had to be bound by the contract.

To conclude that John Doe is not bound by the Agreements otherwise enforceable terms, as Plaintiffs contend, simply because he is a minor would be tantamount to concluding that a parent can never contract with a private school (or any other service provider) on behalf and for the benefit of her child. As a practical matter, no service provider would ever agree to a contract with a parent if a child could ignore the provisions of the contract that pertain to him without recourse.

The court did not determine or decided if a parent can bind a minor to a pre-injury release. The court held that the contract allowed the court to exclude for the sake of argument, any part of the contract that it felt was unenforceable and therefore, the court could decide the issue without deciding the release issue.

The court then found the jurisdiction and venue clause were valid, and the case must be sent to California. Whether that was going to be a California court or arbitration, as required by the contract, in California was up to the California court.

At this point, the plaintiff argued the minute aspects of the contract did not force the case to be sent to California. This forced the court to scrutinize the agreement, down to the placement of a semi-colon. The court determined the jurisdiction and venue portion of the agreement applied.

Unless the forum selection clause “is shown by the resisting party to be unreasonable under the circumstances,” such clauses are prima facie valid. A choice of forum provision will be deemed “unreasonable” only when its enforcement would seriously impair the plaintiff’s ability to pursue its cause of action.” Mere inconvenience or additional expense is not sufficient evidence of unreasonableness.

So Now What?

Over and over I have stressed the importance of a well-written  jurisdiction and venue (choice of forums) clause in your release and in all documents. Here again, this clause will make litigation more difficult for the plaintiff.

You want the lawsuit in your community. Most of the witnesses are usually located there, the business is there, and you are better prepared to defend a claim there.

Another issue that was not brought up the court, but is present in the case is the decision on arbitration. Arbitration may be a great item for you to use if you are dealing with minors for several reasons.

Arbitration is cheaper and quicker than a trial. The rules governing arbitration have a shorter time frame and do not allow as much time for discovery.

Arbitrators, by statute, are usually limited on the type of amount of damages that they can award. As such, punitive or other excessive damages may not be awarded by an arbitrator.

However, arbitration is not necessarily the way to go in every case. Arbitration does not allow, normally for motions for summary judgment. If you have a well-written  release in a state that allows the use of releases, you will have a faster and better result going to court and filing a motion for summary judgment.

Whether or not to put arbitration in a release or other contract is one to be carefully reviewed based on your state, your state law and your situation with your attorney.

What do you think? Leave a comment.

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