SOMERSET FINE HOME BUILDING INC v. SIMPLEX INDUSTRIES INC

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Supreme Court, Appellate Division, Second Department, New York.

SOMERSET FINE HOME BUILDING, INC., Appellant, v. SIMPLEX INDUSTRIES, INC., Respondent.

2019–01242

Decided: July 08, 2020

CHERYL E. CHAMBERS, J.P., JOSEPH J. MALTESE, LINDA CHRISTOPHER, PAUL WOOTEN, JJ. Charles Gleis, Blue Point, NY, for appellant.

DECISION & ORDER

In an action, inter alia, to recover damages for breach of contract, the plaintiff appeals from an order of the Supreme Court, Suffolk County (Elizabeth H. Emerson, J.), dated December 14, 2018.  The order, insofar as appealed from, granted that branch of the defendant's motion which was pursuant to CPLR 3211(a) to dismiss the complaint and denied, as academic, the plaintiff's cross motion for leave to amend the caption.

ORDERED that the order is affirmed insofar as appealed from, without costs or disbursements.

The plaintiff is a home building, home improvement, and home repair company, and the defendant manufactures, ships, and delivers modular homes.  On May 16, 2017, the parties entered into a sales contract whereby the defendant agreed to sell a modular home to the plaintiff.  The sales contract contained a forum selection clause, which provided that the exclusive forum for an action to enforce the contract or to institute arbitration pursuant to the contract would be the Court of Common Pleas of Lackawanna County, Pennsylvania.  The contract also contained an arbitration clause, which provided that all claims and disputes relating to the contract would be subject to arbitration pursuant to Pennsylvania law.  The plaintiff entered into a separate contract with William Gambrill and Kaitlyn Gambrill to replace their existing home with a modular home.

On August 10, 2018, the plaintiff commenced this action against the defendant in the Supreme Court, Suffolk County, alleging, inter alia, breach of contract.  On October 4, 2018, the defendant moved, inter alia, pursuant to CPLR 3211(a) to dismiss the complaint.  The plaintiff cross-moved for leave to amend the caption to add the Gambrills as plaintiffs.  In an order dated December 14, 2018, the court granted that branch of the defendant's motion which was pursuant to CPLR 3211(a) to dismiss the complaint and denied, as academic, the plaintiff's cross motion for leave to amend the caption.  The plaintiff appeals.

“[P]arties to a contract may freely select a forum which will resolve any disputes over the interpretation or performance of the contract” (Brooke Group v. JCH Syndicate 488, 87 N.Y.2d 530, 534, 640 N.Y.S.2d 479, 663 N.E.2d 635).  “ ‘A contractual forum selection clause is prima facie valid and enforceable unless it is shown by the challenging party to be unreasonable, unjust, in contravention of public policy, invalid due to fraud or overreaching, or it is shown that a trial in the selected forum would be so gravely difficult that the challenging party would, for all practical purposes, be deprived of its day in court’ ” (Lifetime Brands, Inc. v. Garden Ridge, L.P., 105 A.D.3d 1011, 1012, 963 N.Y.S.2d 718, quoting Creative Mobile Tech., LLC v. Smart Modular Tech., Inc., 97 A.D.3d 626, 626, 948 N.Y.S.2d 375).

“ ‘In general, an unconscionable contract has been defined as one which is so grossly unreasonable as to be unenforcible because of an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party’ ” (Emigrant Mtge. Co., Inc. v. Fitzpatrick, 95 A.D.3d 1169, 1169–1170, 945 N.Y.S.2d 697, quoting King v. Fox, 7 N.Y.3d 181, 191, 818 N.Y.S.2d 833, 851 N.E.2d 1184).  The doctrine of unconscionability rarely applies in a commercial setting, where the parties are presumed to have equal bargaining power (see Jet Acceptance Corp. v. Quest Mexicana S.A. de C.V., 87 A.D.3d 850, 856, 929 N.Y.S.2d 206;  Gillman v. Chase Manhattan Bank, 135 A.D.2d 488, 491, 521 N.Y.S.2d 729, affd 73 N.Y.2d 1, 537 N.Y.S.2d 787, 534 N.E.2d 824).

Here, the plaintiff failed to demonstrate that the forum selection clause was unconscionable (see Emigrant Mtge. Co., Inc. v. Fitzpatrick, 95 A.D.3d at 1170, 945 N.Y.S.2d 697;  Horton v. Concerns of Police Survivors, Inc., 62 A.D.3d 836, 837, 878 N.Y.S.2d 793).  The plaintiff failed to show that the forum selection clause was unreasonably favorable to the defendant or was the result of “ ‘high pressure commercial tactics, inequality of bargaining power, deceptive practices and language in the contract, [or] an imbalance in the understanding and acumen of the parties’ ” (Emigrant Mtge. Co., Inc. v. Fitzpatrick, 95 A.D.3d at 1170, 945 N.Y.S.2d 697, quoting Simar Holding Corp. v. GSC, 87 A.D.3d 688, 689–690, 928 N.Y.S.2d 592 [internal quotation marks omitted] ).  The plaintiff also failed to show that the forum selection clause was invalid due to fraud (see Lifetime Brands, Inc. v. Garden Ridge, L.P., 105 A.D.3d at 1012, 963 N.Y.S.2d 718).  Finally, the plaintiff offered no evidence that the cost of traveling to Pennsylvania would be so financially prohibitive that it would, for all practical purposes, be deprived of its day in court (see Horton v. Concerns of Police Survivors, Inc., 62 A.D.3d at 837, 878 N.Y.S.2d 793).

Since we agree with the Supreme Court's determination that the forum selection clause, which provides that the Court of Common Pleas of Lackawanna County, Pennsylvania, is the exclusive forum for an action to enforce the contract or to institute arbitration pursuant to the contract, is valid, we need not reach the plaintiff's contentions regarding the enforceability of the arbitration provision.

Accordingly, we agree with the Supreme Court's determination to grant that branch of the defendant's motion which was pursuant to CPLR 3211(a) to dismiss the complaint and to deny, as academic, the plaintiff's cross motion for leave to amend the caption.

CHAMBERS, J.P., MALTESE, CHRISTOPHER and WOOTEN, JJ., concur.

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