Howard v. Go Ahead Vacations, Inc.

2022 Ohio 2202

• Court: Ohio Court of Appeals
• Decided: June 27, 2022
• Docket: 2021-T-0041
• Status: Published

Opinion

[Cite as Howard v. Go Ahead Vacations, Inc., 2022-Ohio-2202.]

IN THE COURT OF APPEALS OF OHIO ELEVENTH APPELLATE DISTRICT TRUMBULL COUNTY

CHERIE H. HOWARD, CASE NO. 2021-T-0041

Plaintiff-Appellant, Civil Appeal from the -v- Girard Municipal Court

GO AHEAD VACATIONS, INC. d.b.a. GO AHEAD TOURS, Trial Court No. 2021 CVI 00187

Defendant-Appellee.

OPINION

Decided: January 27, 2022 Judgment: Reversed and remanded

Jan R. Mostov, 1108 Ravine Drive, Youngstown, OH 44505 (For Plaintiff-Appellant).

Matthew G. Vansuch, Brouse McDowell, LPA, 6550 Seville Drive, Suite B, Canfield, OH 44406 (For Defendant-Appellee).

MATT LYNCH, J.

{¶1} Plaintiff-appellant, Cherie H. Howard, appeals from the judgment of the

Girard Municipal Court, finding a forum selection clause to be applicable and staying the

case for Howard to refile the matter in Massachusetts. For the following reasons, we

reverse the decision of the lower court and remand for further proceedings consistent with

this opinion.

{¶2} On March 8, 2021, Howard filed a Small Claims Complaint against

defendant-appellee, Go Ahead Vacations, Inc., dba EF Go Ahead Tours, in the Girard

Municipal Court. The Complaint alleged that Go Ahead failed to refund to Howard a deposit “in violation of Ohio Adm. Code 109:4-3-07 and R.C. 1345.01 et seq.” and sought

damages in the amount of $1,350.

{¶3} On April 26, 2021, Go Ahead filed a Motion to Dismiss and Trial Brief, in

which it argued that the matter should be dismissed due to the existence of a forum

selection clause in the parties’ written agreement. Attached to the Motion was the affidavit

of Liz Failla, Vice President of Customer Experience for Go Ahead. Pursuant to her

affidavit, Go Ahead markets international tour programs to travelers throughout the United

States, enrolling customers in travel parties. Its headquarters and principal place of

business is in Cambridge, Massachusetts and it has no offices or records kept in Ohio.

Failla indicated that Howard purchased a tour to Italy and Greece, scheduled to depart

on May 16, 2020, through an online enrollment process and paid $4,605.75. Due to

COVID-related travel bans, the tour was unable to depart on the scheduled date. Go

Ahead offered options to rebook at a later date or receive a refund minus a fee of $450.

Go Ahead returned $4,155.75 to Howard.

{¶4} Pursuant to Failla and attached company records, Howard electronically

accepted the Go Ahead Booking Terms and Conditions, which provided various policies

relating to cancellation and deposits. It also included the following clause:

I understand and agree that this agreement shall be governed in all respects, and performance hereunder shall be judged, by the laws of the Commonwealth of Massachusetts. In the event of any claim, dispute or proceeding arising out of my relationship with GAT, or any claim which in contract, tort, or otherwise at law or in equity arises between me and the Released Parties, whether or not related to this agreement, all parties submit and consent to the exclusive jurisdiction and venue of the courts of the Commonwealth of Massachusetts and of the United States District Court for the District of Massachusetts.

Case No. 2021-T-0041 {¶5} On May 11, 2021, Howard filed a Memorandum in Opposition to the Motion

to Dismiss, arguing, inter alia, that the forum selection clause was unconscionable and

against public policy. In her accompanying affidavit, Howard, a resident of Trumbull

County, Ohio, stated that WYSU 88.5 FM, a public radio station owned by Youngstown

State University, sponsors group tours around the world with travelers from eastern Ohio

and western Pennsylvania. According to Howard, these tours are planned by Go Ahead

and a local WYSU tour coordinator matches hotel roommates and provides travelers with

tour updates. She booked the Italy and Greece trip, which was scheduled to depart from

the Pittsburgh airport, online and charged a $450 deposit to her credit card on November

9, 2019. She subsequently received e-mail updates via the WYSU coordinator regarding

COVID’s impact on the trip and its cancellation. According to Howard, she filed an online

consumer complaint with the Massachusetts Attorney General’s Office and was informed

that it had entered into an agreement providing relief only for Massachusetts consumers

whose trips had been cancelled.

{¶6} A Magistrate’s Decision was issued on June 22, 2021, in which the

magistrate determined that Howard “failed to sustain the burden of proof necessary to

invalidate the forum selection clause outlined in the contract between the parties.” The

court adopted the decision.

{¶7} On July 27, 2021, Findings of Fact and Conclusions of Law were issued, in

which the magistrate found there was no evidence that the forum selection clause was

the result of fraud or overreaching, the clause did not violate public policy, and the order

to litigate the matter in Massachusetts did not rise to the level of depriving Howard of her

day in court. Howard filed Objections to the Decision. The court issued a Judgment Entry

Case No. 2021-T-0041 on September 1, 2021, finding no errors in the magistrate’s decision and adopting the

decision. It ordered that the case “is hereby stayed for a period of sixty (60) days to allow

the Plaintiff to refile this action in the Commonwealth of Massachusetts pursuant to Ohio

R. Civ. Pro. 3(E). Upon the expiration of the sixty (60) day period, this case shall be

dismissed.”

{¶8} Howard timely appeals and raises the following assignment of error:

{¶9} “The trial court erred as a matter of law in finding that the forum selection

clause is enforceable.”

{¶10} Ohio courts have reviewed the enforceability of a forum selection clause de

novo. Original Pizza Pan v. CWC Sports Group, Inc., 194 Ohio App.3d 50, 2011-Ohio-

1684, 954 N.E.2d 1220, ¶ 10 (8th Dist.); Keehan Tennessee Invest., L.L.C. v. Praetorium

Secured Fund I, L.P., 2016-Ohio-8390, 71 N.E.3d 325, ¶ 30 (9th Dist.). The party

challenging a forum selection clause bears the burden of establishing it is

unenforceable. Discount Bridal Servs. v. Kovacs, 127 Ohio App.3d 373, 376, 713 N.E.2d

30 (8th Dist.1998), citing The Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 17, 92 S.Ct.

1907, 32 L.Ed.2d 513 (1972).

{¶11} Howard first contends that the forum selection clause is unenforceable “as

it is clearly not commercial in nature.” However, Howard recognizes that the law does

not prohibit enforcement but emphasizes that the trial court failed to acknowledge the

consumer nature of the transaction.

{¶12} “Forum selection clauses should be distinguished between commercial and

noncommercial parties.” Hawkins v. Integrity House, Inc., 11th Dist. Lake No. 2008-L-

120, 2009-Ohio-5893, ¶ 19; Preferred Capital, Inc. v. Power Eng. Group, Inc., 112 Ohio

Case No. 2021-T-0041 St.3d 429, 2007-Ohio-257, 860 N.E.2d 741, ¶ 8. While “[c]ommercial forum-selection

clauses between for-profit business entities are prima facie valid * * * [b]y contrast, in

Ohio, forum-selection clauses are less readily enforceable against consumers.” Id. at ¶

20, citing Info. Leasing Corp. v. Jaskot, 151 Ohio App.3d 546, 2003-Ohio-566, 784 N.E.2d

1192, ¶ 13 (1st Dist.).

{¶13} While we recognize that commercial and non-commercial parties are

treated differently in relation to forum selection clauses, it does not follow that such

clauses are never enforceable in a case involving a consumer. Although the Ohio

Supreme Court has expressed the differences between commercial and non-commercial

parties, it “did not expressly limit application of forum selection clauses to cases involving

commercial parties.” Krygsman v. Gerken, 2d Dist. Montgomery No. 16062, 1997 WL

368358, *4 (July 3, 1997). Forum selection clauses have been found valid in some

noncommercial cases. Id. at *7; IntraSee v. Ludwig, 9th Dist. Lorain Nos. 10CA009916

and 11CA010024, 2012-Ohio-2684, ¶ 22.

{¶14} To the extent that Howard argues the trial court failed to acknowledge the

difference between commercial and noncommercial agreements, we emphasize that this

court evaluates this matter de novo. Thus, this court will consider the foregoing in

determining whether the forum selection clause is enforceable.

{¶15} Howard next argues that the forum selection clause is invalid since the

factors for enforcement of such a clause weigh in her favor. We agree.

{¶16} The Ohio Supreme Court “adopted a three-pronged test, similar to the test

in Bremen [407 U.S. 1, 92 S.Ct. 1907, 32 L.Ed.2d 513], to determine the validity of a

forum-selection clause: (1) Are both parties to the contract commercial entities? (2) Is

Case No. 2021-T-0041 there evidence of fraud or overreaching? (3) Would enforcement of the clause be

unreasonable and unjust?” Preferred Capital, 112 Ohio St.3d 429, 2007-Ohio-257, 860

N.E.2d 741, at ¶ 7; Kennecorp Mtge. Brokers, Inc. v. Country Club Convalescent Hosp.,

Inc., 66 Ohio St.3d 173, 610 N.E.2d 987 (1993), syllabus (“[a]bsent evidence of fraud or

overreaching,” a forum selection clause is valid and enforceable “unless it can be clearly

shown that enforcement of the clause would be unreasonable and unjust”). The test in

Bremen, as has been applied by Ohio courts, sets forth that a forum selection clause is

invalid if the party challenging the clause shows “(1) that the contract was the result of

fraud or overreaching; (2) that enforcement would violate the strong public policy of the

forum state, i.e., in this case, Ohio; and (3) that enforcement under the particular

circumstances of the case would result in litigation in a jurisdiction so unreasonable,

difficult and inconvenient that plaintiff would for all ‘practical purposes be deprived of his

day in court.’” Barrett v. Picker Internatl., Inc., 68 Ohio App.3d 820, 824, 589 N.E.2d 1372

(8th Dist.1990), citing Bremen at 18; inVentiv Health Communications, Inc. v. Rodden,

2018-Ohio-945, 108 N.E.3d 605, ¶ 24 (5th Dist.); IntraSee, 2012-Ohio-2684, at ¶ 8. This

standard has been applied in cases involving non-commercial parties. Krygsman, 1997

WL 368358, at *4; Zilbert v. Proficio Mtge. Ventures, L.L.C., 8th Dist. Cuyahoga No.

100299, 2014-Ohio-1838, ¶ 20; IntraSee at ¶ 8.

{¶17} As observed above, there is no question that Howard is not a commercial

entity and, thus, the forum selection clause here is not prima facie valid and we must

consider this matter while taking into account that the forum selection clause is “less

readily enforceable” in this type of matter. See Hawkins, 2009-Ohio-5893, at ¶ 20, citing

Info. Leasing, 2003-Ohio-566, at ¶ 13. While commercial entities are presumed to have

Case No. 2021-T-0041 experience in contractual and business matters, such is not the case with a consumer.

Preferred Capital at ¶ 8; see also Copelco Capital, Inc. v. St. Mark’s Presbyterian Church,

8th Dist. Cuyahoga No. 77633, 2001 WL 106328, *4 (Feb. 1, 2001) (noting the lack of

sophistication of the parties as a factor in rejecting a forum selection clause). Although

we observe that the same factors relating to fraud, public policy, and reasonableness

have been applied in both commercial and consumer contracts, as the Ohio Supreme

Court has set forth, consideration of whether a contract is commercial is a separate factor

that must be weighed. Given that this contract involves Howard as a consumer with Go

Ahead being a business that markets and plans travel to consumers, this weighs heavily

in Howard’s favor.

{¶18} Next, Howard concedes that she has not argued the forum selection clause

was a product of fraud or overreaching. Nonetheless, it is necessary to briefly examine

this factor, as it is relevant in the overall validity of the forum selection clause and relates

back to the significant factor of the commercial or consumer nature of the contracting

parties. “Overreaching is defined as the act or an instance of taking unfair commercial

advantage of another.” (Citations omitted.) inVentiv at ¶ 25, citing Buckeye Check

Cashing of Arizona, Inc. v. Lang, S.D.Ohio No. 2:06-CV-792, 2007 WL 641824, *5 (Feb.

23, 2007). While unequal bargaining power alone does not support a finding of

overreaching, it “may be found if the disparity in bargaining power was used to take unfair

advantage.” (Citations omitted.) Id. Here, it is worth emphasizing that Go Ahead targets

advertising for group tours in the Ohio area toward Ohio consumers and, according to

Howard, such marketing through the YSU radio station extends to having a local contact

who aids in coordinating the tours. It is reasonable that a consumer may believe that

Case No. 2021-T-0041 such tours are coordinated locally and they would not be litigating this matter in another

state. Even if this does not rise to the level of using bargaining power to take unfair

advantage, it further supports the finding that the remaining factors must be weighed while

taking into account the unequal power between Go Ahead, a sophisticated business, and

Howard as the consumer.

{¶19} Next, Howard argues that the forum selection clause is unreasonable and

unjust, emphasizing the inconvenience of having to litigate the suit in Massachusetts.

{¶20} “In determining whether the selected forum is sufficiently unreasonable,

Ohio courts consider the following factors: (1) which law controls the contractual dispute;

(2) the residency of the parties; (3) where the contract was executed; (4) where the

witnesses and parties to the litigation are located; and (5) whether the forum clause’s

designated location is inconvenient to the parties.” Id. at ¶ 29, citing Original Pizza, 194

Ohio App.3d 50, 2011-Ohio-1684, 954 N.E.2d 1220, at ¶ 15. “A finding of

unreasonableness or injustice must be based on more than inconvenience to the party

seeking to avoid the forum selection clauses’ requirements.” Zilbert, 2014-Ohio-1838, at

¶ 25. “Mere distance, mere expense, or mere hardship to an individual litigant is

insufficient to invalidate a forum selection clause.” (Citation omitted.) IntraSee, 2012-

Ohio-2684, at ¶ 20. “Rather, the trial court must find that enforcement of the clause would

be manifestly and gravely inconvenient to the party seeking to avoid enforcement such

that it will effectively be deprived of a meaningful day in court.” inVentiv at ¶ 28; Bremen,

407 U.S. at 19, 92 S.Ct. 1907, 32 L.Ed.2d 513.

{¶21} As to the first unreasonableness factor, the parties’ contract provides that

the law of Massachusetts applies. This is not of particular significance, as it has been

Case No. 2021-T-0041 noted that the benefit of a choice of law clause would be received “even if the case is tried

in Ohio, since the courts in Ohio would be capable of applying [another state’s] law” and,

thus, such factor “does not weigh heavily in favor of one jurisdiction over the other.” Zilbert

at ¶ 28. As to residency, Go Ahead has its principal place of business in Massachusetts

while Howard is located in Ohio. While this does not weigh heavily in favor of one party

like it might in the instance where the forum is not convenient for either party, we do note

the heavier burden on a consumer to travel, particularly when it comes to cost, while such

a burden is inherent in operating a company. As to where the contract was executed, this

occurred online, with Howard accepting the terms at her residence in Ohio.

{¶22} Significantly, since the group tour at issue involves residents of Ohio and

has a local coordinator located in Ohio, as Howard indicates, it appears the majority of

the witnesses would hail from the state of Ohio. This weighs in favor of Howard as does

the interrelated factor of inconvenience. It has been determined that forums in states

such as Colorado and Utah are inconvenient for Ohio citizens. In Waymire v. Litsakos,

2d Dist. Montgomery No. 13197, 1992 WL 317464 (Nov. 5, 1992), the court determined

that Colorado was an inconvenient forum that would deprive the plaintiff of her day in

court where the witnesses to the transaction were Ohio residents and she would have to

incur the expense of hiring a foreign attorney and flying the witnesses to Colorado. Id. at

*4. In Zilbert, the court found Utah was not a convenient forum where most witnesses

relevant to the action were in Ohio and “the degree of distance between the two states

would contribute to a significant increase in the cost of litigating this action for Zilbert * *

*, Zilbert was making a modest salary[,] [h]e might have difficulty securing witnesses

because of the increased cost of witness fees involved in litigating the action in Utah,”

Case No. 2021-T-0041 and he and the witnesses “would be seriously inconvenienced by the need to obtain

extended leave from jobs or to cover familial obligations.” Id. at ¶ 30-31. See also AJZ’s

Hauling, L.L.C. v. TruNorth Warranty Programs of N. Am., 8th Dist. Cuyahoga No.

109632, 2021-Ohio-1190, ¶ 71 (finding it unreasonable and unjust to require travel and

transportation of witnesses from Pennsylvania to North Carolina). Litigating a case in

Massachusetts would create a significant travel burden for Howard and any witnesses

necessary in this case.

{¶23} We recognize that forums in various states outside of Ohio have been found

not to be inconvenient. To the extent that these cases involve commercial contracts, we

find them to be of limited value since the burden to a consumer is likely greater than to a

corporation and when considering this in the context of the requirement that commercial

and noncommercial contracts be considered differently. Cases involving noncommercial

contracts that have found other states or countries to be convenient forums are

distinguishable. In Krygsman, 1997 WL 368358, Ontario was found to be an appropriate

forum for a plaintiff who resided in Ohio, but the court found that the plaintiff had

maintained her residence and citizenship in Ontario and thus it was not unreasonable to

expect her to litigate her claim in that forum. Id. at *7. In IntraSee, 2012-Ohio-2684, the

court found the forum in Ohio was proper for a plaintiff residing in Minnesota where it was

clear from the employment contract that the company she worked for was located in Ohio

and the plaintiff traveled throughout the country for her job. Id. at ¶ 21. In contrast, here,

Go Ahead marketed toward and targeted regional groups of travelers in Ohio and it is

less evident that Howard would have been aware it was based in Massachusetts and

litigated its disputes there. As noted above, cases where the forum was found

Case No. 2021-T-0041 inconvenient often involved concerns about the availability of witnesses, which is a

relevant concern here given the Ohio-centered focus of these trips.

{¶24} Finally, Howard emphasizes that the forum selection clause contravenes

public policy in Ohio since she brought her action under the Ohio Consumer Sales

Protection Act, which demonstrates a significant interest in protecting Ohio consumers.

She argues that Go Ahead committed unfair business practices by failing to give $1.4

million in refunds for cancelled trips and that others in Ohio may be entitled to refunds.

{¶25} Howard has not cited authority for the proposition that the public policy of

Ohio prevents forum selection clauses in consumer contracts or where consumer

protection claims are brought by the plaintiff. We recognize the consumer protection laws

of this state pursuant to R.C. Chapter 1345, which prohibit unfair and deceptive acts in

connection with consumer transactions. R.C. 1345.02(A). However, the contract sets

forth that Massachusetts law will apply and Massachusetts also has similar statutory

provisions preventing unfair and deceptive acts. Mass.Gen. Laws Ann. 93A, § 11. There

is no reason to believe that Massachusetts law, and the Massachusetts courts’ application

of that law, would not adequately protect Howard or address violations of consumers’

rights. Thus, we determine this factor does not weigh significantly in either party’s favor.

{¶26} A review of the foregoing factors demonstrates they weigh in favor of

Howard. While there are arguably a few factors that do not favor either party, the

significant inconvenience to Howard and potential witnesses and the weight that must be

given to consideration of the fact that she was the consumer in this transaction heavily

favor a determination that the forum selection clause is invalid. As such, we reverse the

lower court’s decision to enforce the forum selection clause and stay the matter for filing

Case No. 2021-T-0041 in Massachusetts and remand with instructions that this matter shall proceed in the Girard

Municipal Court.

{¶27} The assignment of error is with merit.

{¶28} For the foregoing reasons, the judgment of the Girard Municipal Court is

reversed and this matter is remanded for further proceedings consistent with this opinion.

Costs to be taxed against appellee.

THOMAS R. WRIGHT, P.J.,

JOHN J. EKLUND, J.,

concur.

Case No. 2021-T-0041