Jacobsen Const. Co., Inc. v. Teton Builders

2005 UT 4, 106 P.3d 719, 517 Utah Adv. Rep. 3, 2005 Utah LEXIS 5, 2005 WL 78309
CourtUtah Supreme Court
DecidedJanuary 14, 2005
Docket20030727
StatusPublished
Cited by26 cases

This text of 2005 UT 4 (Jacobsen Const. Co., Inc. v. Teton Builders) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jacobsen Const. Co., Inc. v. Teton Builders, 2005 UT 4, 106 P.3d 719, 517 Utah Adv. Rep. 3, 2005 Utah LEXIS 5, 2005 WL 78309 (Utah 2005).

Opinion

DURRANT, Justice:

T1 In this appeal we must determine whether a Utah court may properly exercise personal jurisdiction over two Wyoming defendants on the basis of a forum selection clause contained in a contract between those defendants and a Utah plaintiff, We conclude that the contractual agreement to litigate all claims in Utah is enforceable. Further, because the plaintiff's primary place of business is in Utah, there is a sufficiently rational nexus to this state to justify exercising personal jurisdiction over the defendants. Because the district court reached the same conclusion, we affirm.

BACKGROUND

12 When reviewing a district court's pretrial determination of jurisdiction, we accept the facts alleged in the complaint as true unless controverted by affidavit or deposition. Anderson v. Am. Soc'y of Plastic & Reconstructive Surgeons, 807 P.2d 825, 827 (Utah 1990). Because there are no disputed facts relevant to the jurisdictional issue presented in this appeal, the following exposition is drawn from the complaint filed by Jacob-sen Construction Company, Inc. ("Jacobsen") against its subcontractor, Teton Builders, and Teton Builders's president, Thomas R. Hunter (collectively "Teton"). . Additional facts are taken from the parties' uncontro-verted pleadings.

T3 The underlying dispute between the parties to this appeal stems from a development project for the Four Seasons Resort in Jackson Hole, Wyoming (the "Project"). On June 8, 2002, Jacobsen, as general contractor, and Teton, as subcontractor, entered into a contract in relation to the Project. Pursuant to that contract, Teton was to perform rough carpentry work on the Project. Thomas R. Hunter served as a personal guarantor for his company's performance.

T4 According to Jacobsen, Teton failed to finish its work within the time parameters set by the parties' agreement, forcing Jacob-sen to take steps to avoid costly delays to the Project as a whole. The facts surrounding the alleged breach are far from clear at this stage in the proceeding and, in large part, are not critical to the resolution of the current appeal. As a result, the parties have, appropriately, not expended undue effort on elaborating the facts surrounding the alleged breach. However, Jacobsen does acknowledge that Teton was concerned about the Project's funding and suggests that Teton's decision to abandon the Project was based on *722 its trepidation, whether justified or not, about receiving payment for its work. According to Jacobsen, Teton was provided with a joint check to alleviate its concerns and to avoid potential liens against the Project. 1 Nevertheless, Teton ceased work on the Project. Jacobsen subsequently filed a complaint against Teton in Utah Third District Court, claiming that it was forced to complete Teton's work and suffered damages as a result.

15 Without answering the complaint, Te-ton moved for a dismissal, arguing that the district court did not have personal jurisdiction to hear the case because both Teton Builders and Mr. Hunter are residents of Wyoming and all events relevant to the formation and performance of the contract occurred in Wyoming. Teton maintains, and Jacobsen does not dispute, that it was informed of the Project through a Jacobsen satellite office located in Jackson Hole, Wyoming. Additionally, although Mr. Hunter states that "[dJuring the bidding process[ J[he] received two or three telephone calls from an estimator at Jacobsen's Salt Lake City office," it appears that all post-bid contacts between Teton and Jacobsen took place in Wyoming. Teton Builders and Mr. Hunter's essentially unchallenged position is that they have "never conducted business in any way within the State of Utah."

T6 Jacobsen opposed the motion to dismiss, arguing that Teton's contacts with Utah were irrelevant because a forum selection clause in the parties' contract provided a sufficient basis upon which the district court could exercise personal jurisdiction. Teton countered that the clause was unenforceable and that, in any event, the clause only evidenced Teton's consent to venue and not to jurisdiction and thus. a traditional minimum contacts analysis was still required. The pivotal contractual language states that "[alll arbitration proceedings and litigation shall take place within Salt Lake County, State of Utah."

17 After a hearing on the motion to dismiss, the district court concluded that the forum selection clause was enforceable. The district court also concluded that, via the forum selection clause, Teton had consented to Utah's exercise .of personal jurisdiction. That conclusion implicated our holding in Phone Directories Co. v. Henderson, 2000 UT 64, 8 P.3d 256, that a party's consent to jurisdiction renders the traditional minimum contacts test inapplicable. Id. at 114. In such a case, jurisdiction may be properly exercised as long as there is a rational nexus between the litigation and the State of Utah. Id. at 11 14-15. Because Jacobsen's primary place of business is in Utah, the district court held that a sufficiently rational nexus existed between Utah and the parties' dispute to justify exercising personal jurisdiction over Teton. This appeal followed. We have jurisdiction pursuant to Utah Code section 78-2-(2002).

T8 On appeal, Teton assigns error to the district court's conclusion, primarily arguing that Utah public policy requires a dismissal under the cireumstances presented by this case. Teton also contends that, even if the forum selection clause is enforceable, it evidences a consent to venue only and not to jurisdiction, rendering our decision in Phone Directories inapposite and a rational nexus inquiry inappropriate: Finally, Teton argues that, even if the district court properly invoked the rational nexus test, it applied that test in a manner inconsistent with prior case law. We examine each contention in turn.

STANDARD OF REVIEW

19 The first issue to be addressed on appeal is whether the district court properly concluded that the parties' forum selection clause is enforceable. A district court's decision to enforce a forum selection clause is reviewed for abuse of discretion. Prows v. Pinpoint Retail Sys., Inc., 868 P.2d 809, 810 (Utah 1998). The "court abuses its discretion in enforcing [a] forum selection clause [when the] clause is 'so unreasonable that its enforcement would. be ... against both logic and the facts on the record." " Id. (quoting Personalized Mktg. Serv., Inc. v. Stotler & *723 Co., 447 N.W.2d 447, 451 (Minn.Ct.App.1989)).

110 Additionally, we must review the district court's denial of Teton's motion to dismiss. Because the district court did not hold an evidentiary hearing and relied only on documentary evidence, we use a correctness standard on review. See Arguello v. Indus. Woodworking Mach. Co., 838 P.2d 1120

Free access — add to your briefcase to read the full text and ask questions with AI

Related

PCVI v. Premsrirut and Brown Brown
Court of Appeals of Utah, 2026
Jenkins v. Prime Insurance
Tenth Circuit, 2024
Volonte v. Domo, Inc.
2023 UT App 25 (Court of Appeals of Utah, 2023)
LGCY Power v. Super. Ct.
California Court of Appeal, 2022
Rocky Mountain Builders Supply Inc. v. Marks
2017 UT App 41 (Court of Appeals of Utah, 2017)
Roberts v. C.R. England, Inc.
318 F.R.D. 457 (D. Utah, 2017)
Gillett v. Brown
2017 UT App 19 (Court of Appeals of Utah, 2017)
Federated Capital Corp. v. Libby
2016 UT 41 (Utah Supreme Court, 2016)
Bad Ass Coffee Co. of Hawaii v. Royal Aloha International, LLC
2015 UT App 303 (Court of Appeals of Utah, 2015)
Wakefield Kennedy, LLC v. State Capital Holdings, LLC
614 F. App'x 929 (Tenth Circuit, 2015)
Dahl v. Dahl
2015 UT 23 (Utah Supreme Court, 2015)
Energy Claims Ltd. v. Catalyst Investment Group Ltd.
2012 UT App 32 (Court of Appeals of Utah, 2012)
Energy Claims Ltd. v. Catalyst Inv. Group
2011 UT App 342 (Court of Appeals of Utah, 2011)

Cite This Page — Counsel Stack

Bluebook (online)
2005 UT 4, 106 P.3d 719, 517 Utah Adv. Rep. 3, 2005 Utah LEXIS 5, 2005 WL 78309, Counsel Stack Legal Research, https://law.counselstack.com/opinion/jacobsen-const-co-inc-v-teton-builders-utah-2005.