General Electric Capital Corporation v. Metz Family Enterprises
In ruling on a motion to dismiss, the court was required to evaluate the cause of action presented in the plaintiff's complaint independently from its prejudgment remedy application and could not reasonably have concluded that a New York forum selection clause, which carved out a limited exception for equitable relief, permitted the plaintiff to bring its breach of contract action outside of New York because the action was not a claim for equitable relief. General Electric Capital Corporation brought a breach of contract action against Metz Family Enterprises, LLC, Alicia Metz and Lauren Simons alleging that the Metz Family breached its obligations under a promissory note by failing to pay certain installment payments due and that Metz and Simons breached their guaranty agreements. The trial court denied the defendants' motion to dismiss the complaint claiming that Connecticut was an improper venue because a forum selection clause in the note designated New York as the exclusive jurisdiction for legal claims arising out of the agreement. The court granted the plaintiff's application for a prejudgment remedy against the defendants attaching property of $1.5 million. The defendants appealed. The Appellate Court reversed the judgment imposing the prejudgment remedy against Metz Family and affirmed the judgment against Metz and Simons. The defendants waived a claim that the trial court lacked personal jurisdiction over Metz Family by filing an answer and special defenses without moving to dismiss for lack of personal jurisdiction. However, because the forum selection clause designated New York as the exclusive forum for resolving disputes arising out of the note, carving out only a limited exception for equitable relief, it would be unreasonable for a Connecticut court to exercise jurisdiction over the action seeking only legal relief for alleged breach of contract. In ruling on the motion to dismiss, had the court properly evaluated the cause of action in the complaint independently from the prejudgment remedy application, the court could not reasonably have concluded that the forum selection clause permitted the breach of contract action against Metz Family outside of New York. Further, without a viable complaint on which to evaluate the prejudgment remedy application, the court could not have found probable cause to believe that judgment would be rendered for the plaintiff in a trial on the merits of the complaint.