Use Care When Drafting Forum Selection Clauses in North Carolina

 The North Carolina Court of Appeals in A&D Environmental Services, Inc. v. Miller, No. 14-CVS-6328 (N.C. Ct. App. April 7, 2015) held that forum selection clauses designating a specific venue in North Carolina will be considered valid and enforceable only if the North Carolina legislature specifically allows for it.   In A&D, the Court of Appeals affirmed the denial of a Rule 12(b)(3) motion to dismiss based on the forum selection clause.  The Court ostensibly disallowed forum selection clauses that try to force parties to litigate in counties in which they otherwise would not be subject to venue by statute.  In breach of contract cases, the dispute “must be tried in the county in which the [Plaintiff] or [Defendant] . . . reside[s.]” N.C. Gen. Stat. § 1-82 (2013).   In A&D, the record was devoid of any evidence proving  that either party resided in Mecklenberg County (the contractually designated venue), and the motion to dismiss was denied.   The Court of Appeals was careful to make the distinction between forum selection clauses which designate a venue within the State versus those contracts designating forum selection outside of North Carolina.  The full opinion can be found here