General Electric Capital Corp. v. LLC (2011)

MEMORANDUM OF DECISION

This is an articulation of the court's decision of July 12, 2011 denying the defendants' motion to dismiss (# 109.01) in a brief written memorandum.   At the court's invitation, the defendant filed a motion for articulation on July 20, 2011.

I

FACTS

On May 17, 2011, the plaintiff, General Electric Capital Corporation, filed a three-count complaint against the defendants, Metz Family Enterprises, LLC (Metz Family), Alicia Metz and Lauren Simons.   The complaint alleges the following facts.   The plaintiff is a Delaware corporation having a place of business in Danbury, Connecticut.   Defendant Metz Family is a limited liability company organized under the laws of the state of New York and has its chief executive offices in Sharon, Connecticut.   Individual defendants Metz and Simons reside in Sharon, Connecticut.   The complaint alleges that venue and jurisdiction are proper because Metz Family owns real property and/or has transacted business in Connecticut and the individual defendants are residents of Connecticut.

Through a promissory note dated July 27, 2006, Metz Family, as maker, promised to pay the plaintiff the principal sum of $1,600,000 with interest on the unpaid balance.   On January 21, 2009, Metz Family and the plaintiff executed a modification agreement for the sole purpose of modifying the payment schedule set forth in the promissory note.   The plaintiff alleges that Metz Family breached its obligations under the promissory note by failing to pay installment payments due in March and April 2011.   The plaintiff issued notice to Metz Family that it was in default and demanded past due payments.   Thereafter, the plaintiff exercised its right under the promissory note and modification agreement to accelerate the obligations of Metz Family.   Metz Family failed to pay its accelerated obligations.   Count one of the complaint alleges breach of contract against Metz Family.

Counts two and three of the complaint allege breach of guaranty against the individual defendants, Alicia Metz and Lauren Simons, respectively.   The complaint alleges that Metz and Simons signed individual guaranty agreements as a necessary condition for the plaintiff to enter into the promissory note with Metz Family.   Upon the default by Metz Family, the plaintiff informed Metz and Simons that Metz Family had failed to make the installment payment(s) due and demanded that Metz and/or Simons satisfy the past due payment(s).  Neither Metz nor Simons made payment on the amount due to the plaintiff.   Thereafter, the plaintiff informed Metz and Simons that it was exercising its right to accelerate Metz Family's obligations and demanded that Metz and/or Simons, as guarantors, make payment in full.   Neither Metz nor Simons satisfied the obligation under the respective individual guaranty agreements to pay the accelerated obligations of Metz Family.

The complaint alleges that $1,078,211.96 plus interest, default interest, and late charges in excess of $87,182.05 is presently due and owing.   On May 31, 2011, the plaintiff filed an application for prejudgment remedy against the defendants, seeking attachment of the defendants' real and personal property in the amount of $1,500,000.

On June 17, 2011, the defendants filed a motion to dismiss the entire action for improper venue and lack of jurisdiction.   On June 30, 2011, the plaintiff filed a memorandum of law in opposition to the motion to dismiss followed by a supplemental memorandum of law in opposition on July 8, 2011.   The defendants filed a reply memorandum on July 8, 2011.   The matter was heard on the July 2, 2011 short calendar.

On July 12, 2011, the court issued an order denying the motion to dismiss (# 109.01) along with a memorandum of decision (# 109.02).   Because time was of the essence in light of an upcoming prejudgment remedy hearing, the court noted that the decision was made without the statement of extensive facts or analysis and that the parties could request an articulation to be made at a later time.

On July 20, 2011, the defendants filed a motion for articulation of the court's decision on the motion to dismiss.

II

DISCUSSIONAMemorandum of Decision (# 109.02)

In the memorandum of decision on the defendants' motion to dismiss, the court stated:  “The suit seeks to obtain a prejudgment remedy against properties located in Connecticut.   Although the promissory note provides that Metz Family ‘submits to the exclusive jurisdiction of the state and federal courts located in the State of New York’ it also provides that the plaintiff or Metz Family have the right to ‘apply to a court of competent jurisdiction in the United States or abroad for equitable relief as is necessary to preserve, protect, and enforce its respective rights under this Note and any other Debt Document, including but not limited to, orders of attachment or injunction necessary to maintain the status quo pending litigation ․’ (Emphasis added.)   These two provisions must be read harmoniously if possible.   The court agrees with the following quotation from the plaintiff's memorandum in opposition to the motion to dismiss:  ‘When read in its entirety, the clear purpose of the forum selection provision is to permit GE Capital to ‘follow the money’ in the event of default by Metz Family and attach assets to answer the breach wherever these assets may be located.' “

“The language quoted above says that the plaintiff has the right to seek ‘orders of attachment’ to ‘maintain the status quo pending litigation.’   An order of attachment is known as a prejudgment remedy in Connecticut.   This means that the plaintiff has the right to seek a prejudgment remedy against Metz Family in Connecticut to maintain the status quo pending litigation in New York. Therefore, the plaintiff will need to obtain a judgment against Metz Family in the courts of New York before it can execute upon the assets attached in Connecticut.”

“As to the guarantors, Metz and Simons, there is no reason which prevents the plaintiff from using the courts of Connecticut to secure a prejudgment remedy and to obtain money judgments.   The individual guaranties signed by Metz and Simons does not contain the New York exclusive forum language quoted above.   The plaintiff is free to seek prejudgment remedies against Metz and Simons and to proceed to judgment in Connecticut.”

“The motion to dismiss is denied.”

B

Motion for Articulation

First, the defendants seek articulation to clarify the court's order.   According to the defendants, they moved to dismiss the matter on various grounds, including on the basis of an exclusive forum selection clause and on the basis that because any dispute between the parties must be governed by New York law, pursuant to the promissory note and guaranty agreements, a New York court would be best suited for any litigation.   The defendant notes that the court appears to have ruled that the motion to dismiss with regard to the individual defendants, Metz and Simons, was denied in its entirety but that the motion to dismiss regarding Metz Family was granted, in part, insofar as “the plaintiff will need to obtain a judgment against Metz Family in the Courts of New York before it can execute upon the assets attached in Connecticut.”   According to the defendants, while the decision seems to rule that the plaintiff can pursue prejudgment relief against Metz Family in Connecticut, it cannot continue litigation on the merits in Connecticut.   The defendants contend that this is a reasonable interpretation but note that the court's decision simply concludes with “[t]he motion to dismiss is denied.”

Second, the defendants seek articulation on whether the plaintiff can seek a prejudgment remedy in Connecticut, such as an attachment, while there is no currently pending litigation filed in New York. Third, the defendants seek articulation with regard to whether, based on the promissory note and guaranty agreements, New York law governs any dispute and litigation with regard to the parties.   Finally, the defendants seek articulation with regard to the facts and analysis that form the basis of the court's decision.

“It is well settled that [a]n articulation [pursuant to Practice Book § 66–5] is appropriate where the trial court's decision contains some ambiguity or deficiency reasonably susceptible of clarification ․ [P]roper utilization of the motion for articulation serves to dispel any ․ ambiguity by clarifying the factual and legal basis upon which the trial court rendered its decision ․” (Internal quotation marks omitted.)  AvalonBay Communities, Inc. v. Zoning Commission, 130 Conn.App. 36, 49–50 n.13, 21 A.3d 926 (2011).

C

Motion to Dismiss Standard

“A motion to dismiss ․ properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court.”  (Internal quotation marks omitted.)  Bacon Construction Co. v. Dept. of Public Works, 294 Conn. 695, 706, 987 A.2d 348 (2010).  “A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction.”   (Internal quotation marks omitted.)  Wilcox v. Webster Ins., Inc., 294 Conn. 206, 213, 982 A.2d 1053 (2009).  “The grounds which may be asserted in [a motion to dismiss] are:  (1) lack of jurisdiction over the subject matter;  (2) lack of jurisdiction over the person;  (3) improper venue;  (4) insufficiency of process;  and (5) insufficiency of service of process.”  Zizka v. Water Pollution Control Authority, 195 Conn. 682, 687, 490 A.2d 509 (1985), citing Practice Book § 143, which is now § 10–31.

“When a trial court decides a jurisdictional question raised by a pretrial motion to dismiss on the basis of the complaint alone, it must consider the allegations of the complaint in their most favorable light ․ In this regard, a court must take the facts to be those alleged in the complaint, including those facts necessarily implied from the allegations, construing them in a manner most favorable to the pleader.”  (Internal quotation marks omitted.)   Conboy v. State, 292 Conn. 642, 651, 974 A.2d 669 (2009).

“In contrast, if the complaint is supplemented by undisputed facts established by affidavits submitted in support of the motion to dismiss ․ other types of undisputed evidence ․ and/or public records of which judicial notice may be taken ․ the trial court, in determining the jurisdictional issue, may consider these supplementary undisputed facts and need not conclusively presume the validity of the allegations of the complaint ․ Rather, those allegations are tempered by the light shed on them by the [supplementary undisputed facts] ․ If affidavits and/or other evidence submitted in support of a defendant's motion to dismiss conclusively establish that jurisdiction is lacking, and the plaintiff fails to undermine this conclusion with counteraffidavits ․ or other evidence, the trial court may dismiss the action without further proceedings ․ If, however, the defendant submits either no proof to rebut the plaintiff's jurisdictional allegations ․ or only evidence that fails to call those allegations into question ․ the plaintiff need not supply counteraffidavits or other evidence to support the complaint, but may rest on the jurisdictional allegations therein.”  (Citations omitted;  emphasis in original;  internal quotation marks omitted.)  Conboy v. State, supra, 292 Conn. 651–52.

“[A]ffidavits are insufficient to determine the facts unless ․ they disclose that no genuine issue as to a material fact exists.”  (Internal quotation marks omitted.)  Conboy v. State, supra, 292 Conn. 651 n.14. In addition, in this, as in other contexts, “[i]t is well settled that statements of counsel are not evidence.”  (Internal quotation marks omitted.)  Temlock v. Temlock, 95 Conn.App. 505, 517, 898 A.2d 209, cert. denied, 279 Conn. 910, 902 A.2d 1070 (2006).

D

Parties' Arguments

The defendants move to dismiss the plaintiff's action for improper venue and lack of jurisdiction.   First, the defendants argue that the forum selection and choice of law provisions drafted by the plaintiff and agreed to by the parties are clear and unambiguous and should be honored by this court.   The defendants contend that the promissory note contains an exclusive forum selection clause that mandates that any action on the promissory note be brought in New York. According to the defendants, by the terms of the promissory note, the burden would be on the plaintiff to pursue a judgment in New York and, if successful, then seek to enforce that judgment in Connecticut as a foreign judgment, which might enable the plaintiff to obtain an attachment in Connecticut.   Furthermore, the defendants argue that there is a tenuous relationship to Connecticut, separate and apart from the parties' specific choice of New York as jurisdiction for any disputes.   Specifically, the defendants contend that Metz Family is a New York company, the individual defendants are members of the New York company and Metz Family's principal place of business is in New York.

Next, the defendants argue that the language of the guaranty agreements is clear and unambiguous that they are to be governed in accordance with New York law.   The defendants contend that, even though the guaranty agreements do not necessarily contain an exclusive forum selection clause, the guaranty agreements flow from the promissory note and they should be governed in accordance with New York law.   According to the defendants, judicial economy dictates that because the claim against Metz Family must be litigated in New York and New York law must apply pursuant to the terms of the promissory note, New York is the appropriate forum to hear the action against the guaranties.

Finally, the defendants argue that the plaintiff would not suffer a hardship if a New York court adjudicated this dispute.

The plaintiff, on the other hand, argues that the motion to dismiss should be denied because the court does not lack jurisdiction and venue is proper in Connecticut for all of the claims against the defendants.   With regard to the jurisdictional defect claim, the plaintiff argues that, to the extent that the defendants base their jurisdictional defect claim upon the purported forum selection clause, controlling case law makes clear that forum selection clauses do not oust courts of their jurisdiction.

Next, as to the individual defendants, the plaintiff argues that venue is proper because the guaranty agreements contain only a choice of law provision.   According to the plaintiff, where an underlying contract, i.e., the promissory note, contains both choice of law and choice of forum provisions, but a guaranty contains only a choice of law provision, the choice of forum clause contained in the underlying agreement should not be imposed upon the parties to the guaranty.   Moreover, the plaintiff contends that the individual defendants' relationship to Connecticut is not tenuous, noting that the plaintiff, Metz Family and the individual defendants are all located in Connecticut, the guaranty agreements were executed in Connecticut, and the plaintiff's efforts to enforce its rights under the guaranty agreements, including all communications with the individual defendants, have taken place within Connecticut.

As to Metz Family, the plaintiff argues that venue is proper for several reasons.   First, the plaintiff contends that Connecticut has a significant relationship to the dispute, noting that Metz Family executed the promissory note in Connecticut, the plaintiff has a place of business in Connecticut, the manager of Metz Family, i.e., defendant Alicia Metz, resides in Connecticut, written communications from the plaintiff to Metz Family were directed to a Connecticut address, which was provided by the defendants, and the promissory note states that Metz Family is located at 25 Mitcheltown Road in Sharon, Connecticut.   The plaintiff also contests Metz Family's assertion that it is a New York limited liability company that has a principal place of business in New York, noting that Metz Family has failed to register with the Secretary of State as either a domestic or foreign limited liability company and the promissory note states that Metz Family is located at 25 Mitcheltown Road in Sharon, Connecticut.

Additionally, the plaintiff argues that the forum selection clause contained in the promissory note, when read in its entirety, permits the plaintiff to proceed in Connecticut.   Specifically, the plaintiff contends that the clear purpose of the forum selection clause is to permit the plaintiff to follow the money in the event of a default by Metz Family and attach assets to answer to the breach wherever those assets may be located.   According to the plaintiff, notwithstanding the New York choice of forum provision, the promissory note expressly provides the plaintiff the right to apply to a court of competent jurisdiction anywhere in the United States for orders of attachment.   The plaintiff notes that it filed this action seeking, among other things, an order of attachment against the defendants' property and the Connecticut procedure for such an attachment includes litigation of the merits of the case to judgment.   Thus, the attachment and merits litigation in Connecticut are a single, unified proceeding and this is the type of action which the terms of the promissory note exempt from New York venue.

E

Analysis1Jurisdiction

“Historically, courts viewed forum selection clauses as improper attempts by the parties to oust jurisdiction from a court that otherwise had the authority to hear an action ․ Courts refused to enforce, as contrary to public policy, forum selection clauses that attempted to vest exclusive jurisdiction in a specific forum over controversies that would arise in the future ․ Indeed, [our Supreme Court] previously adopted that reasoning and concluded that a forum selection clause in an insurance policy making Haiti the exclusive forum for all questions arising from the policy was illegal and against public policy ․ Quoting from a decision of the Massachusetts Supreme Judicial Court, [our Supreme Court] embraced the notion that, just as parties cannot, by their consent, give jurisdiction to courts, where the law has not given it ․ it seems to follow from the same course of reasoning, that parties cannot take away jurisdiction, where the law has given it ․”In more recent years, however, courts have concluded that forum selection clauses do not oust courts of their jurisdiction, but they have been willing to enforce such contract clauses as long as they were reasonable by declining to exercise jurisdiction over an action in certain circumstances ․ The United States Supreme Court took the lead on this issue in Bremen v. Zapata Off–Shore Co., 407 U.S. 1, 92 S.Ct. 1907, 32 L.Ed.2d 513 (1972), in which the court rejected the traditional view that forum selection clauses are unenforceable as contrary to public policy.   The court stated that [t]he argument that such clauses are improper because they tend to ‘oust’ a court of jurisdiction is hardly more than a vestigial legal fiction ․ No one seriously contends in this case that the forum-selection clause ‘ousted’ the District Court of jurisdiction over [the defendant's] action.   The threshold question is whether that court should have exercised its jurisdiction to do more than give effect to the legitimate expectations of the parties, manifested in their freely negotiated agreement, by specifically enforcing the forum clause ․

“We are persuaded by the reasoning of the United States Supreme Court in Bremen, and conclude that ․ [t]he existence of [a forum selection] clause does not deprive the trial court of personal jurisdiction over the parties, but presents the question whether it is reasonable for the court to exercise its jurisdiction in the particular circumstances of the case.”  (Citations omitted;  internal quotation marks omitted.)  Reiner, Reiner and Bendett, P.C. v. The Cadle Co., 278 Conn. 92, 100–03, 897 A.2d 58 (2006).

In the present case, this court has not been deprived of its jurisdiction over the defendants by way of the forum selection clause contained in the promissory note.¹  The court must determine, however, whether to exercise its jurisdiction.

“While improper venue may be raised by a motion to dismiss ․ the claim does not go to subject matter jurisdiction, but rather it is a claim that the court, which otherwise has personal jurisdiction over the defendant, should decline to exercise it under the circumstances.”   Clarkson v. Classic Motor Carriages, Inc., Superior Court, judicial district of Danbury, Docket No. CV 310929 (December 28, 1992, Fuller, J.) (8 Conn. L. Rptr. 160).

“The terms ‘jurisdiction’ and ‘venue’ are not synonymous.   Jurisdiction has to do with the authority or power of a court to hear and decide the cause of action presented to it and its source is the constitutional and statutory provisions by which it is created ․ Venue, on the other hand, concerns only the place where the case may be tried, and venue requirements are created for the convenience of the parties ․ Our Supreme Court has said that [i]t is a well established rule that, outside the area of administrative appeals, venue is not a jurisdictional but a procedural question;  consequently, venue, unlike subject matter jurisdiction, can be waived by the parties.  [V]enue is a matter that goes to process rather than substantive rights.”  (Citations omitted;  internal quotation marks omitted.)  Haigh v. Haigh, 50 Conn.App. 456, 465–66, 717 A.2d 837 (1998);  see Fort Trumbull Conservancy, LLC v. New London, 282 Conn. 791, 925 A.2d 292 (2007).  “The requirements of jurisdiction are grounded in the state's inherent judicial power, while the requirements of venue are grounded in convenience to litigants.”  (Internal quotation marks omitted.)  In re Matthew F., 297 Conn. 673, 691, 4 A.3d 248 (2010).

Under both Connecticut and New York law, venue is proper, among other places, in the state where a defendant is located.  General Statutes § 51–345;  N.Y. C.P.L.R. § 503.   Nonetheless, Connecticut and New York law permits parties to agree “to submit to the jurisdiction of a particular tribunal.”   Phoenix Leasing, Inc. v. Kosinski, 47 Conn.App. 650, 653, 707 A.2d 317 (1998);  Brooke Group, Ltd. v. JCH Syndicate, 488, 87 N.Y.2d 530, 663 N.E.2d 635 (1996).  “Connecticut case law is clear that the courts will uphold an agreement of the parties to submit to the jurisdiction of a particular tribunal ․ [P]arties to a contract may agree in advance to submit to the jurisdiction of a given court ․ Absent a showing of fraud or overreaching, such forum clauses will be enforced by the courts ․ When the court selected is reasonably appropriate, and where there is no indication that the parties had such greatly disproportionate bargaining power that the agreement could be regarded as unconscionable, the tendency is to give effect to such agreements.”  (Citations omitted;  internal quotation marks omitted.)   Friedman v. Jamison Business Systems, Inc., Superior Court, judicial district of Danbury, Docket No. CV 01 0343518 (February 25, 2002, White, J.) (31 Conn. L. Rptr. 473–74);  see Bio Capital, LLC v. BioSystem Solutions, Inc., Superior Court, judicial district of Stamford–Norwalk, Docket No. CV 08 5009331 (June 1, 2009, Pavia, J.) (“In Connecticut, a two-step analysis for determining whether a forum selection clause should be enforced has been developed by the trial courts.   Initially, the court must look to contract formation itself to ascertain whether the clause was the product of fraud or deception.   Secondly, the court must determine whether the inconvenience resulting to the moving party would be so great that enforcement of the forum selection clause would create undo hardship”).

“In Phillips v. Audio Active, Ltd., 494 F.3d 378 (2nd Cir.2007), the [Second Circuit] used a four part analysis in determining whether a forum selection clause was presumptively enforceable, and, if so whether the resisting party had rebutted the presumption of enforceability ․” Boehringer Ingelheim Vetmedica, Inc. v. Merial, Ltd, United States District Court, Docket No. CV 212 (D.Conn., January 14, 2010).   Although not binding on this court, the Phillips court's four-part analysis provides a useful framework for determining whether the forum selection clause in the present case is enforceable.   Moreover, although no Connecticut court has expressly adopted the Phillips court's framework, the methodology is, nonetheless, in accordance with the manner in which Connecticut courts have addressed the enforceability of forum selection clauses.   See Bio Capital, LLC v. BioSystem Solutions, Inc., supra, Superior Court, Docket No. CV 08 5009331;  Post Road Furniture Group, Inc. v. Landmark Merchant Solutions, Superior Court, judicial district of Ansonia–Milford, Docket No. CV 04 0085820 (November 18, 2004, Moran, J.);  Friedman v. Jamison Business Systems, Inc., supra, 31 Conn. L. Rptr. 473.

“The first inquiry is whether the clause was reasonably communicated to the party resisting enforcement ․ The second step requires us to classify the clause as mandatory or permissive, i.e., to decide whether the parties are required to bring any dispute to the designated forum or simply permitted to do so ․ Part three asks whether the claims and parties involved in the suit are subject to the forum selection clause ․ If the forum clause was communicated to the resisting party, has mandatory force and covers the claims and parties involved in the dispute, it is presumptively enforceable ․ The fourth, and final, step is to ascertain whether the resisting party has rebutted the presumption of enforceability by making a sufficiently strong showing that enforcement would be unreasonable or unjust, or that the clause was invalid for such reasons as fraud or overreaching.”  (Citations omitted;  internal quotation marks omitted.)  Boehringer Ingelheim Vetmedica, Inc. v. Merial, Ltd., supra, United States District Court, Docket No. CV 212;  see Phillips v. Audio Active, Ltd., supra, 494 F.3d 378.

In the present case, there is no dispute as to the first inquiry;  the forum selection clause was reasonably communicated to both parties.

The second step requires a determination as to whether the forum selection clause is mandatory or permissive.   In the present case, the clause provides in relevant part:  “This note shall be construed in accordance with and governed by the laws of the state of New York. Maker irrevocably submits to the exclusive jurisdiction of the state and federal courts located in the state of New York to hear and determine any suit, action or proceeding and to settle any dispute, which might arise out of or in connection herewith and with the debt documents ․ Notwithstanding the foregoing, each of Maker and Payee shall have the right to apply to a court of competent jurisdiction in the United States of America or abroad for equitable relief as is necessary to preserve, protect and enforce its respective rights under this Note and any other Debt Document, including, but not limited to orders of attachment or injunction necessary to maintain the status quo pending litigation or to enforce judgments against Maker, any Obligor or the collateral pledged to Payee pursuant to any Debt Document or to gain possession of such collateral.” ²

“The general rule, as demonstrated by several federal cases, is that a forum selection clause conferring jurisdiction in one forum will not be interpreted as excluding jurisdiction elsewhere unless it contains specific language of exclusion ․ Connecticut case law also appears to impose the requirement that the language of the clause indicate that the forum choice is exclusive.”   (Citations omitted.)  Friedman v. Jamison Business Systems, Inc., supra, 31 Conn. L. Rptr. 474;  see Post Road Furniture Group, Inc. v. Landmark Merchant Solutions, supra, Superior Court, Docket No. CV 04 0085820 (“The general rule is that a clause conferring jurisdiction in one forum will only be interpreted as excluding jurisdiction elsewhere when it contains specific language to that effect ․ Several Connecticut courts have required that a forum selection clause specify that the chosen forum is the sole forum for litigation between the parties”).   Moreover, “[i]t is well established that Connecticut courts are competent to apply the law of a foreign jurisdiction ․ and the inclusion of [a] choice of law provision does not evidence an intention on the part of the parties to provide for exclusive jurisdiction in New York courts.”  Friedman v. Jamison Business Systems, Inc., supra, 31 Conn. L. Rptr. 474.  “The general rule in cases containing forum selection clauses is that when only jurisdiction is specified the clause will generally not be enforced without some further language indicating the parties' intent to make jurisdiction exclusive ․ Of course if mandatory venue language is employed, the clause will be enforced ․ The choice of forum must be mandatory rather than permissive.”  (Emphasis in original;  internal quotation marks omitted.)   Alliance Food Management Corp. v. Rensselaer Hartford Graduate Center, Inc., Superior Court, judicial district of Waterbury, Docket No. CV 05 5002441 (April 10, 2007, Gallagher, J.) (43 Conn. L. Rptr. 146), quoting John Boutari & Son, Wines & Spirits, S.A. v. Attiki Importers & Distributors, Inc., 22 F.3d 51, 52–53 (2nd Cir.1994).

In the present case, the promissory note does contain exclusive jurisdiction language which would appear to create a mandatory forum selection clause requiring that an action on the promissory note be brought in New York. That exclusive jurisdiction language, however, is later qualified by the exception that permits both parties to “apply to a court of competent jurisdiction in the United States of America or abroad for equitable relief as is necessary to preserve, protect and enforce its respective rights under this Note and any other Debt Document, including, but not limited to orders of attachment or injunction necessary to maintain the status quo pending litigation or to enforce judgments against Maker, any Obligor or the collateral pledged to Payee pursuant to any Debt Document or to gain possession of such collateral.”   Accordingly, under certain circumstances, the forum selection clause is permissive, jurisdiction not being exclusive New York.

“The third step in the analysis is to determine whether the parties and claims involved in the suit are subject to the forum selection clause.”  Boehringer Ingelheim Vetmedica, Inc. v. Merial, Ltd., supra, United States District Court, Docket No. CV 212.   The court finds that the plaintiff and Metz Family are subject to the forum selection clause.   The “maker” is Metz Family.   The “payee” is the plaintiff.

“The second aspect of the third step in the analysis set out in Phillips is that the claims involved in the suit are subject to the forum selection clause.   The question of the scope of a forum selection clause is one of contract interpretation and [w]hether or not a forum selection clause applies depends on what the specific clause at issue says ․ The scope of a forum selection clause is a contractual question that requires the courts to interpret the clause and, where ambiguous, to consider the intent of the parties.”  (Citations omitted;  emphasis in original;  internal quotation marks omitted.)  Boehringer Ingelheim Vetmedica, Inc. v. Merial, Ltd., supra, United States District CourDP1⌑In the present case, the court concludes that the forum selection clause in the promissory note does not confer exclusive New York jurisdiction over actions wherein one of the parties seeks equitable relief, including orders of attachment.   The court agrees with the following quotation from the plaintiff's memorandum in opposition to the motion to dismiss:  “When read in its entirety, the clear purpose of the forum selection provision is to permit GE Capital to ‘follow the money’ in the event of default by Metz Family and attach assets to answer the breach wherever these assets may be located.”

Connecticut is a court of competent jurisdiction.   Orders of attachment are prejudgment remedies in Connecticut and are governed by General Statutes § 52–578c.  “[U]nder the clear language and structure of § 52–578c, a plaintiff's application for a prejudgment remedy is not a standalone pleading;  rather it is entirely dependent on the ‘action’ set forth in the attached writ, summons and complaint.”  Cahaly v. Benistar Property Exchange Trust Co., 268 Conn. 264, 273, 842 A.2d 1113 (2004).³  “[T]he ‘action’ referred to in § 52–578c(a)(1) must be an action that the plaintiff is about to bring in Connecticut upon which a Connecticut court will render judgment.   It does not include a future judgment on an action that the plaintiff has filed or proposes to file in another state.”  Id., 274.   The prejudgment remedy statutes “expressly link an application for a prejudgment remedy to the action set forth in the attached writ, summons and complaint.”  Id., 280.

In the present case, the plaintiff filed an application for a prejudgment remedy as to all defendants on May 31, 2011, which is dependent on the action filed against the defendants on May 17, 2011.   The terms of the promissory note permit the plaintiff to seek an order of attachment in Connecticut to maintain the status quo pending litigation.   In Connecticut, an application for a prejudgment remedy must be based on an action that the plaintiff will bring in Connecticut to be adjudicated by Connecticut courts.   In other words, an application for a prejudgment remedy cannot be brought where there is no independent cause of action to be litigated in Connecticut.   The procedure for a prejudgment remedy, therefore, includes litigation of the merits of the case to judgment.   The forum selection clause carves out an exception from New York jurisdiction for actions intended to attach property, as is the case here.   Any contradictory language in the original memorandum was dicta which is expressly clarified herein.

Thus, although the forum selection clause covers both the plaintiff and Metz Family, the court concludes that it does not have mandatory force or confer exclusive New York jurisdiction over claims involving orders of attachment.   As such, the court need not reach the final step in the analysis set out in Philips to determine whether the plaintiff has rebutted the presumption of enforceability.   See Phillips v. Audio Active, Ltd., supra, 494 F.3d 378;  Boehringer Ingelheim Vetmedica, Inc. v. Merial, Ltd., supra, United States District Court, Docket No. CV 212;  see also United States Trust Co. v. Bohart, 197 Conn. 34, 42, 495 A.2d 1034 (1985) citing with approval, Bremen v. Zapata Off-shore Co., supra, 407 U.S. 10–12 (absent a showing of fraud or overreaching, forum selection clauses will be enforced by the courts);  see also Denby v. Interlock Industries, Inc., Superior Court, judicial district of Hartford, Docket No. CV 07 5011730 (March 12, 2008, Bentivegna, J.) (“[T]he inconvenience necessary to persuade a court to decline to enforce a forum selection clause that has been found to be valid must be serious inconvenience, such inconvenience as would effectively deprive a plaintiff ․ of a forum in which to pursue its claim against [the defendant] ․ [T]he party resisting enforcement of the (forum selection) clause bears a heavy burden in convincing the court that it should not be held to its bargain ․ The result may seem harsh but it is one imposed by the contents of the agreement between the parties.”  (Citation omitted;  internal quotation marks omitted.)).

Accordingly, as to Metz Family, the court holds that the plaintiff is entitled to bring an action for prejudgment remedy in Connecticut.   As such, the motion to dismiss is denied.

Regarding the individual guaranty agreements signed by Metz and Simons, these agreements do not contain exclusive New York forum language, only a New York choice of law provision.⁴  The defendants contend that venue is improper in Connecticut because the individual guaranties flow from the promissory note, which, the defendants argue, contains an exclusive New York forum provision.   Where an underlying contract contains choice of law and choice of forum provisions but the guaranty agreement contains only a choice of law provision, the choice of forum provision contained in the underlying contract should not be imposed on the parties to the guaranty.   See Synergy Nutritional Industries, Inc. v. Sports One, Inc., Superior Court, judicial district of New Haven, Docket No. CV 02 0469163 (December 4, 2002, Munro, J.);  Pal Pools, Inc. v. Billiot Bros., Inc., 394 N.Y.S.2d 280 (N.Y.App.Div.1977);  see also Leasecomm Corp. v. Watkins, Superior Court, judicial district of Ansonia–Milford, Docket No. CV 04 0085843 (January 12, 2005, Shluger, J.) (38 Conn. L. Rptr. 529) (Jury waiver contained in lease in action against guarantor not applicable because the guaranty did not contain the waiver and there was no indication that the guarantor assented to all the terms and conditions of the lease).

In the present case, because the individual guaranty agreements do not contain an exclusive forum selection clause nor any indication that the individual defendants assented to all the terms and conditions of the promissory note, there is nothing which prevents the plaintiff from using the courts of Connecticut to secure a prejudgment remedy and to obtain money judgments against Metz and Simons.   Accordingly, the motion to dismiss as to the individual defendants is denied.

As to the defendants' request in their motion for articulation asking the court to provide articulation concerning whether New York law governs any dispute and litigation with regard to the parties, the court declines to address this issue.  “[A] choice of law analysis is a laborious process involving numerous considerations.”   Plainfield v. Select Energy Contracting, Inc., Superior Court, judicial district of Windham, Docket No. CV 06 5000410 (November 5, 2007, Martin, J.).   In the underlying motion to dismiss, the defendants did not provide the court with any analysis on this issue and, as such, it is not properly before this court on the motion for articulation.

BY THE COURT,

John W. Pickard

FOOTNOTES

FN1. Although the defendants argue that their relationship to Connecticut is tenuous, seeming to imply that they lack sufficient minimum contacts with Connecticut to satisfy due process requirements, the defendants failed to adequately brief this issue and the court declines to address it.  “The court is not required to review issues that have been improperly presented to [the] court through an inadequate brief ․ Analysis, rather than mere abstract assertion, is required in order to avoid abandoning an issue by failure to brief the issue properly ․ Where a claim is asserted in the [brief] but thereafter receives [none or] only cursory attention in the brief without substantive discussion or citation of authorities, it is deemed to be abandoned.”   Commission on Human Rights & Opportunities v. Sullivan Associates, Superior Court, judicial district of New Haven, Docket No. CV 94 4031061 (June 6, 2011, Wilson, J.) quoting Smith v. Andrews, 289 Conn. 61, 80, 959 A.2d 597 (2008).   The court considers the defendants' jurisdictional argument to be based solely on the existence of a forum selection clause..  FN1. Although the defendants argue that their relationship to Connecticut is tenuous, seeming to imply that they lack sufficient minimum contacts with Connecticut to satisfy due process requirements, the defendants failed to adequately brief this issue and the court declines to address it.  “The court is not required to review issues that have been improperly presented to [the] court through an inadequate brief ․ Analysis, rather than mere abstract assertion, is required in order to avoid abandoning an issue by failure to brief the issue properly ․ Where a claim is asserted in the [brief] but thereafter receives [none or] only cursory attention in the brief without substantive discussion or citation of authorities, it is deemed to be abandoned.”   Commission on Human Rights & Opportunities v. Sullivan Associates, Superior Court, judicial district of New Haven, Docket No. CV 94 4031061 (June 6, 2011, Wilson, J.) quoting Smith v. Andrews, 289 Conn. 61, 80, 959 A.2d 597 (2008).   The court considers the defendants' jurisdictional argument to be based solely on the existence of a forum selection clause.

FN2. “This note shall be construed in accordance with and governed by the laws of the state of New York. Maker irrevocably submits to the exclusive jurisdiction of the state and federal courts located in the state of New York to hear and determine any suit, action or proceeding and to settle any dispute, which might arise out of or in connection herewith and with the debt documents ․ Maker irrevocably waives any objection which it might now or hereafter have to the above-named courts being nominated as the exclusive forum to hear and determine any such proceedings and agrees not to claim that it is not personally subject to the jurisdiction of the above-named courts for any reason whatsoever, that it or its property is immune from legal process for any reason whatsoever, that any such court is not a convenient or appropriate forum in each case whether on the grounds of venue or forum non-conveniens or otherwise.   Maker acknowledges that bringing any such suit, action or proceeding in any court other than the courts set forth above will cause irreparable harm to payee ․ Notwithstanding the foregoing, each of Maker and Payee shall have the right to apply to a court of competent jurisdiction in the United States of America or abroad for equitable relief as is necessary to preserve, protect and enforce its respective rights under this Note and any other Debt Document, including, but not limited to orders of attachment or injunction necessary to maintain the status quo pending litigation or to enforce judgments against Maker, any Obligor or the collateral pledged to Payee pursuant to any Debt Document or to gain possession of such collateral.”   (Emphasis omitted.).  FN2. “This note shall be construed in accordance with and governed by the laws of the state of New York. Maker irrevocably submits to the exclusive jurisdiction of the state and federal courts located in the state of New York to hear and determine any suit, action or proceeding and to settle any dispute, which might arise out of or in connection herewith and with the debt documents ․ Maker irrevocably waives any objection which it might now or hereafter have to the above-named courts being nominated as the exclusive forum to hear and determine any such proceedings and agrees not to claim that it is not personally subject to the jurisdiction of the above-named courts for any reason whatsoever, that it or its property is immune from legal process for any reason whatsoever, that any such court is not a convenient or appropriate forum in each case whether on the grounds of venue or forum non-conveniens or otherwise.   Maker acknowledges that bringing any such suit, action or proceeding in any court other than the courts set forth above will cause irreparable harm to payee ․ Notwithstanding the foregoing, each of Maker and Payee shall have the right to apply to a court of competent jurisdiction in the United States of America or abroad for equitable relief as is necessary to preserve, protect and enforce its respective rights under this Note and any other Debt Document, including, but not limited to orders of attachment or injunction necessary to maintain the status quo pending litigation or to enforce judgments against Maker, any Obligor or the collateral pledged to Payee pursuant to any Debt Document or to gain possession of such collateral.”   (Emphasis omitted.)

FN3. The issue in Cahaly v. Benistar Property Exchange Trust Co., supra, 268 Conn. 273–74, was “whether the prejudgment remedy statutes are satisfied by attaching to the application an unsigned writ of summons and complaint that constitutes a prospective action in Connecticut that will be brought to enforce a foreign judgment, prior to the foreign judgment's having been obtained.”  (Emphasis omitted;  internal quotation marks omitted.)   The Supreme Court held that General Statutes § 52–278c(a)(1) does not apply to potential future actions.  Id., 274.   Rather, the action has to be one that the plaintiff will bring in Connecticut and upon which a Connecticut court will render judgment.  Id. In their reply memorandum, the defendants strongly argue that Cahaly is inapplicable to the present case.   Although the defendants are correct that the narrow issue before our Supreme Court in Cahaly is distinguishable from the facts of the present case, this court, nonetheless, finds the Supreme Court's discussion of the procedural requirements for prejudgment remedies to be instructive..  FN3. The issue in Cahaly v. Benistar Property Exchange Trust Co., supra, 268 Conn. 273–74, was “whether the prejudgment remedy statutes are satisfied by attaching to the application an unsigned writ of summons and complaint that constitutes a prospective action in Connecticut that will be brought to enforce a foreign judgment, prior to the foreign judgment's having been obtained.”  (Emphasis omitted;  internal quotation marks omitted.)   The Supreme Court held that General Statutes § 52–278c(a)(1) does not apply to potential future actions.  Id., 274.   Rather, the action has to be one that the plaintiff will bring in Connecticut and upon which a Connecticut court will render judgment.  Id. In their reply memorandum, the defendants strongly argue that Cahaly is inapplicable to the present case.   Although the defendants are correct that the narrow issue before our Supreme Court in Cahaly is distinguishable from the facts of the present case, this court, nonetheless, finds the Supreme Court's discussion of the procedural requirements for prejudgment remedies to be instructive.

FN4. “This Guaranty shall be governed by, or construed in accordance with, the law of the State of New York.”.  FN4. “This Guaranty shall be governed by, or construed in accordance with, the law of the State of New York.”

Pickard, John W., J.