Brief Fact Summary.
Rudzewicz (Defendant) argued that the district court’s exercise of personal jurisdiction over him violated due process.
Synopsis of Rule of Law
A choice of law provision in a contract may be considered in determining whether a defendant has purposely made use of the benefits and protections of the forum state and therefore the forum state may exercise personal jurisdiction over him.
Rudzewicz (Defendant) and MacShara (Defendant) applied for a Burger King (Plaintiff) franchise in Michigan.Â Their application was accepted and a written agreement executed with the Burger King (Plaintiff) corporate headquarters in Miami, Florida.Â The contract called for payments to be made to the Miami office, and that its terms would be interpreted and enforced under the law of Florida.Â Defendants defaulted on their payments, and Plaintiff sued for breach in district court in Florida.Â The district court held it had both personal and subject matter jurisdiction over the defendants and entered judgment for Plaintiff.Â The court of appeals reversed, holding the choice of law provision was irrelevant to the determination of personal jurisdiction and excluded it in evaluating the contacts with Florida.Â Burger King (Plaintiff) appealed.
Is a choice of law provision in a contract relevant to the determination of personal jurisdiction over a defendant?
(Brennan, J.)Â Yes.Â A choice of law provision in a contract may be considered in determining whether a defendant has purposely made use of the protection of the forum state and therefore the forum state may exercise personal jurisdiction over him.Â While not dispositive, this element may be used to show the defendant’s consent to abide by and avail himself of the laws of the state.Â Therefore, the provision requiring application of Florida law, when considered with the other evidence of contacts, could serve to allow personal jurisdiction over Rudzewicz (Defendant).Â Reversed.
(Stevens, J.)Â Rudzewicz (Defendant) had no reason to believe he would be subject to suit anywhere but in Michigan.Â All of the negotiations with Burger King (Plaintiff) were in Michigan.Â Since Burger King’s (Plaintiff) Michigan office was solely charged with dealing with Rudzewicz (Defendant), he could not reasonably expect to be sued elsewhere.
The basis of a finding of personal jurisdiction rests on the question whether compelling the defendant to defend himself in the forum state is in accord with with due process. Â The Court in this case appears to infer a type of consent to jurisdiction based on the choice of law provision.Â As personal jurisdiction may be consented to, the Court has opened the door to a wider scope of liability.