39 Fla. L. Weekly D596b
Contracts — Venue — Trial court properly dismissed
counterclaims relating to an investment agreement on basis of mandatory forum
selection clause contained in agency investment agreement — Inconvenience and
additional costs are insufficient reasons to refuse to enforce a mandatory forum
selection clause
counterclaims relating to an investment agreement on basis of mandatory forum
selection clause contained in agency investment agreement — Inconvenience and
additional costs are insufficient reasons to refuse to enforce a mandatory forum
selection clause
THE ESTATE OF IDELLE STERN, etc., et al., Appellants, vs. OPPENHEIMER TRUST
COMPANY, Appellee. 3rd District. Case No. 3D13-688. L.T. Case No. 12-2448.
Opinion filed March 19, 2014. An Appeal from a non-final order from the Circuit
Court for Miami-Dade County, Bernard S. Shapiro, Judge. Counsel: Stok Folk +
Kon, and Robert A. Stok and Daniel Brennan, for appellants. Wintter &
Associates, P.A., and Christopher Q. Wintter and Max G. Soren (Hollywood), for
appellee.
COMPANY, Appellee. 3rd District. Case No. 3D13-688. L.T. Case No. 12-2448.
Opinion filed March 19, 2014. An Appeal from a non-final order from the Circuit
Court for Miami-Dade County, Bernard S. Shapiro, Judge. Counsel: Stok Folk +
Kon, and Robert A. Stok and Daniel Brennan, for appellants. Wintter &
Associates, P.A., and Christopher Q. Wintter and Max G. Soren (Hollywood), for
appellee.
(Before ROTHENBERG, LOGUE, and SCALES, JJ.)
(ROTHENBERG, Judge.) The appellants challenge the trial court’s order
dismissing the portions of their counterclaim against Oppenheimer Trust Company
(“Oppenheimer”) relating to the Stern Charitable Remainder Unitrust (“CRUT”) due
to a forum selection clause in an agency investment agreement governing that
trust. We agree that the agency agreement is the sole document governing the
relationship and duties between the parties as to the CRUT, and therefore affirm
the trial court’s dismissal.
dismissing the portions of their counterclaim against Oppenheimer Trust Company
(“Oppenheimer”) relating to the Stern Charitable Remainder Unitrust (“CRUT”) due
to a forum selection clause in an agency investment agreement governing that
trust. We agree that the agency agreement is the sole document governing the
relationship and duties between the parties as to the CRUT, and therefore affirm
the trial court’s dismissal.
The appeal before us stems from a highly contentious and complicated
guardianship proceeding regarding the now-deceased Idelle Stern (“Mrs.
Stern”).1 The facts of the underlying
proceeding are myriad, but the relevant considerations for our decision are as
follows. As part of his estate plan, Rabbi Tibor H. Stern (“Rabbi Stern”), also
deceased, established two separate trusts to provide for his family and other
charitable interests. One trust, the CRUT, named Mrs. Stern as the sole lifetime
income beneficiary, with a remainder interest in several charities. The other
trust, the Reformed Stern Living Trust (“Stern Living Trust”), comprised three
separate sub-trusts, and provided income interests for Mrs. Stern and remainder
interests for the Sterns’ four daughters, Rochelle Kevelson, Tikvah Lyons, Joyce
Genauer, and Judy Sugar.
guardianship proceeding regarding the now-deceased Idelle Stern (“Mrs.
Stern”).1 The facts of the underlying
proceeding are myriad, but the relevant considerations for our decision are as
follows. As part of his estate plan, Rabbi Tibor H. Stern (“Rabbi Stern”), also
deceased, established two separate trusts to provide for his family and other
charitable interests. One trust, the CRUT, named Mrs. Stern as the sole lifetime
income beneficiary, with a remainder interest in several charities. The other
trust, the Reformed Stern Living Trust (“Stern Living Trust”), comprised three
separate sub-trusts, and provided income interests for Mrs. Stern and remainder
interests for the Sterns’ four daughters, Rochelle Kevelson, Tikvah Lyons, Joyce
Genauer, and Judy Sugar.
The CRUT and the Stern Living Trust have different trustees, beneficiaries,
and trust documents, and are also funded and managed entirely separately.
Importantly, although Oppenheimer is involved in the management of both trusts,
it is the co-trustee of the Stern Living Trust, while it is merely an investment
agent of the CRUT pursuant to a separate written contract entitled
“Discretionary Agency/Investment Management Account Agreement” (“the Agency
Agreement”). The Agency Agreement contains a forum selection clause that clearly
specifies: “Any proceeding of any nature out of this Agreement shall be
instituted only in the courts by the State of New Jersey.”
and trust documents, and are also funded and managed entirely separately.
Importantly, although Oppenheimer is involved in the management of both trusts,
it is the co-trustee of the Stern Living Trust, while it is merely an investment
agent of the CRUT pursuant to a separate written contract entitled
“Discretionary Agency/Investment Management Account Agreement” (“the Agency
Agreement”). The Agency Agreement contains a forum selection clause that clearly
specifies: “Any proceeding of any nature out of this Agreement shall be
instituted only in the courts by the State of New Jersey.”
During the pendency of the underlying guardianship action, Oppenheimer filed
an action seeking court approval of its accounting of the Stern Living Trust,
and the appellants counterclaimed for thirteen separate causes of action
alleging various types of fraud, mismanagement, violations of Florida’s Blue Sky
Laws, and breaches of fiduciary duty. Oppenheimer moved to dismiss the causes of
action based on the mandatory forum selection clause in the Agency Agreement and
the trial court, after hearing two days of argument, granted that motion with
respect to all claims relating to the CRUT, but left the claims concerning the
Stern Living Trust pending in Miami-Dade Circuit Court. This appeal followed.
an action seeking court approval of its accounting of the Stern Living Trust,
and the appellants counterclaimed for thirteen separate causes of action
alleging various types of fraud, mismanagement, violations of Florida’s Blue Sky
Laws, and breaches of fiduciary duty. Oppenheimer moved to dismiss the causes of
action based on the mandatory forum selection clause in the Agency Agreement and
the trial court, after hearing two days of argument, granted that motion with
respect to all claims relating to the CRUT, but left the claims concerning the
Stern Living Trust pending in Miami-Dade Circuit Court. This appeal followed.
Although the appellants raise several points of error on appeal, all of these
arguments appear to confuse Oppenheimer’s duties and obligations as co-trustee
of the Stern Living Trust with Oppenheimer’s duties and obligations as the
investment agent of the CRUT pursuant to the Agency Agreement. Most of the
appellants’ arguments rely on the faulty premise that the heightened duties
imposed on trustees by the Florida Trust Code necessarily apply to Oppenheimer
as the investment agent of the CRUT as well. For that reason, appellants’
arguments are unavailing, and we affirm the trial court’s dismissal.
arguments appear to confuse Oppenheimer’s duties and obligations as co-trustee
of the Stern Living Trust with Oppenheimer’s duties and obligations as the
investment agent of the CRUT pursuant to the Agency Agreement. Most of the
appellants’ arguments rely on the faulty premise that the heightened duties
imposed on trustees by the Florida Trust Code necessarily apply to Oppenheimer
as the investment agent of the CRUT as well. For that reason, appellants’
arguments are unavailing, and we affirm the trial court’s dismissal.
The Agency Agreement is the only connection between the parties, and any
duties owed to the appellants necessarily stem from that contract. Although the
appellants have tried to frame this case as a trust dispute, the CRUT portion of
this litigation against Oppenheimer is nothing more than a commercial dispute
over an investment agreement, which is governed by the Agency Agreement. As
such, we are guided by the principles of general contract law in interpreting
the forum selection clause in the Agency Agreement.
duties owed to the appellants necessarily stem from that contract. Although the
appellants have tried to frame this case as a trust dispute, the CRUT portion of
this litigation against Oppenheimer is nothing more than a commercial dispute
over an investment agreement, which is governed by the Agency Agreement. As
such, we are guided by the principles of general contract law in interpreting
the forum selection clause in the Agency Agreement.
Florida law is well-settled that mandatory forum selection clauses “should be
enforced in the absence of a showing that enforcement would be unreasonable or
unjust.” Manrique v. Fabbri, 493 So. 2d 437, 440 (Fla. 1986). A party
seeking to avoid enforcement of a mandatory forum selection clause bears a heavy
burden of establishing that the enforcement is unjust or unreasonable and must
demonstrate that the contractually designated forum essentially amounts to “no
forum at all,” thereby depriving the party of its day in court. Am. Safety
Cas. Ins. Co. v. Mijares Holding Co., LLC, 76 So. 3d 1089, 1092 (Fla. 3d DCA
2011) (quoting Corsec, S.L. v. VMC Int’l Franchising, LLC, 909 So. 2d
945, 947 (Fla. 3d DCA 2005)).
enforced in the absence of a showing that enforcement would be unreasonable or
unjust.” Manrique v. Fabbri, 493 So. 2d 437, 440 (Fla. 1986). A party
seeking to avoid enforcement of a mandatory forum selection clause bears a heavy
burden of establishing that the enforcement is unjust or unreasonable and must
demonstrate that the contractually designated forum essentially amounts to “no
forum at all,” thereby depriving the party of its day in court. Am. Safety
Cas. Ins. Co. v. Mijares Holding Co., LLC, 76 So. 3d 1089, 1092 (Fla. 3d DCA
2011) (quoting Corsec, S.L. v. VMC Int’l Franchising, LLC, 909 So. 2d
945, 947 (Fla. 3d DCA 2005)).
The appellants in this matter do not contest that the forum selection clause
at issue is mandatory. Furthermore, the appellants’ only reasons why the CRUT
litigation should not take place in New Jersey are inconvenience and additional
costs to themselves, neither of which is sufficient to refuse to enforce a forum
selection clause. See Manrique, 493 So. 2d at 440 n.4 (“We
emphasize that the test of unreasonableness is not mere inconvenience or
additional expense.”). We accordingly affirm the trial court’s dismissal of the
CRUT claims without prejudice to the appellants to file their action in the New
Jersey courts as the Agency Agreement dictates.
at issue is mandatory. Furthermore, the appellants’ only reasons why the CRUT
litigation should not take place in New Jersey are inconvenience and additional
costs to themselves, neither of which is sufficient to refuse to enforce a forum
selection clause. See Manrique, 493 So. 2d at 440 n.4 (“We
emphasize that the test of unreasonableness is not mere inconvenience or
additional expense.”). We accordingly affirm the trial court’s dismissal of the
CRUT claims without prejudice to the appellants to file their action in the New
Jersey courts as the Agency Agreement dictates.
Affirmed.
__________________
1Mrs. Stern was alive for the majority of
the litigation, but passed away on July 11, 2013, after this appeal was filed.
Her estate was substituted as the party in interest.
the litigation, but passed away on July 11, 2013, after this appeal was filed.
Her estate was substituted as the party in interest.
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