DocketNumber: Appeal No. C-990277. Trial No. A-9805453.
Filed Date: 12/8/1999
Status: Non-Precedential
Modified Date: 4/17/2021
This dispute arose out of a stock-purchase agreement between Deaconess HomeCare, Inc., and Mark Waters. Deaconess purchased Elk Valley Affiliates, Inc., of Tennessee, which had been owned by Waters, a Tennessee resident with no ties to Ohio. As part of that agreement, Deaconess paid Waters a certain sum, with the balance to be paid in installments. Additionally, Elk Valley entered into an employment contract with Waters. Part of the employment contract included a forum-selection clause stating that any employment-related disputes would be decided in Ohio courts based upon Ohio law.
When Deaconess failed to pay Waters the balance on the purchase of his company, and Elk Valley terminated Waters's employment, Waters filed suit against both Deaconess and Elk Valley in Tennessee state court, claiming a breach of contract. Deaconess attempted to remove the case to federal court, but, due to a lack of diversity jurisdiction, the federal court returned the matter to state court. Deaconess and Elk Valley then filed suit against Waters in Hamilton County, Ohio, also claiming breach of contract. Deaconess and Elk Valley included in their complaint claims against Pearlman, Nebben Associates, P.C., alleging that the accounting firm had committed fraud by misrepresenting to Deaconess the financial status of Elk Valley prior to its purchase by Deaconess.
Deaconess and Elk Valley now appeal to this court, claiming that the trial court erred in dismissing their suit against Waters and Pearlman Nebben. Deaconess and Elk Valley claim that the trial court did have in personam jurisdiction over both defendants, that the trial court should not have deferred to the pending Tennessee action, and that the Ohio forum was a convenient forum for a trial.
The Tennessee state court first acquired jurisdiction in this matter, with the right to adjudicate all claims between the parties, because the claims brought by Deaconess and Elk Valley in the Ohio suit are essentially the same as those brought by Waters in his action against Deaconess and Elk Valley in Tennessee. Therapy Partners of Am., Inc. v. Health Partners, Inc.
(1998),
Although Deaconess and Elk Valley correctly argue that Waters consented to the adjudication of employment-related disputes in Ohio, that alone does not confer jurisdiction in Ohio. To begin with, Waters executed the employment contract with Elk Valley, not Deaconess. Thus, Deaconess is not a real party in interest for any employment-related claims, and the trial court correctly dismissed Deaconess's employment-related claims against Waters. Second, although the employment contract contained a forum-selection clause, the contract was not a commercial contract requiring enforcement without looking at other factors. SeeBarrett v. Picker International, Inc. (1990),
Forum-selection clauses are generally enforceable unless they are invalid due to fraud or overreaching, or unless enforcement would be unreasonable and unjust. See M/S Bremen v. Zapata Off-ShoreCo. (1972),
As for the claims by Deaconess and Elk Valley against Pearlman Nebben, there is nothing in the record to demonstrate that Pearlman Nebben is subject to jurisdiction in Ohio for any act, contract, or business conducted in Ohio. Thus, Pearlman Nebben is not subject to Ohio's long-arm statute, R.C.
Therefore, the judgment of the trial court is affirmed.
Further, a certified copy of this Judgment Entry shall constitute the mandate, which shall be sent to the trial court under App.R. 27. Costs shall be taxed under App.R. 24.
Hildebrandt, P.J., Painter and Winkler, JJ.