SCARCELLA v. AMERICA ONLINE INC (2005)

Orders (Debra Rose Samuels, J.), dated September 8, 2004 and March 28, 2005, affirmed, without costs.

Civil Court properly concluded that the forum selection clause set forth in the electronic AOL membership agreement, which required that any dispute against AOL be litigated in Virginia, was unenforceable in the limited context of this small claims case.   Plaintiff made a sufficient showing that enforcement of the forum selection clause in the parties' “clipwrap” agreement would be unreasonable in that he would be deprived not only of his preferred choice to litigate this $5,000 controversy in the Small Claims Part, but, for all practical purposes, of his day in court (see British West Indies Guaranty Trust Co., Ltd. v. Banque Internationale A Luxembourg, 172 A.D.2d 234, 567 N.Y.S.2d 731 [1991] ).   This is particularly so in view of the costs and inconvenience attendant to litigating this claim in Virginia;  the $2,000 monetary limit of the Virginia Small Claims Court (see Va. Stat. Ann. § 16.1-122.3), which would preclude plaintiff from seeking the full amount of his $5,000 claim;  and perhaps most importantly, defendant's unqualified right to transfer the matter out of the Virginia Small Claims Court (see Va. Stat. Ann. § 16.1-122.4).

Enforcement of the forum selection provision in these circumstances would frustrate the stated legislative goal of providing a “simple, informal and inexpensive procedure” for the disposition of small claims (see CCA 1802).  Rosenbaum v. Gateway, 4 Misc.3d 128(A), 2004 WL 1462568 (2004), relied upon by defendant, does not compel a contrary result since it involved the enforceability of a threshold agreement to arbitrate not shown to be onerous or unfair.

This constitutes the decision and order of the court.

PER CURIAM.