West Virginia not the place for suit against architectural firm

By John O'Brien | Oct 4, 2013

CHARLESTON – Greenbrier County Circuit Court was the wrong place for a group of businesses to sue an architectural firm, the state Supreme Court has ruled.

On Sept. 27, the court ruled 4-1 against Commerce Limited Partnership #9213, Commerce Group, Inc., and NCV Equity Funding in their lawsuit against Olivieri, Shousky and Kiss. It used the precedent set in a controversial once-$50 million case against Massey Energy to arrive at its decision.

“(T)his Court concludes that the circuit court did not err in granting respondents’ motion to dismiss based on the forum-selection clause of the contract,” the memorandum decision says.

“The parties agreed that the place of jurisdiction for all disputes arising in connection with the contract would be the principal place of business of respondents exclusively.”

The plaintiffs contracted Olivieri, Shousky and Kiss to create architectural designs for a residential renovation at a building owned by Commerce Limited Partnership in 2003.

The contract offer was a six-page offer on the Olivieri firm’s Collingwood, N.J., letterhead. It was sent to Commerce Group in Deerfield Beach, Fla.

NCV Equity Funding alleged it paid the Olivieri firm more than $12,000 for work, but the plaintiffs were not satisfied with the designs they received.

They filed a breach of contract lawsuit against the Olivieri firm in Greenbrier Circuit Court, but the Olivieri firm moved to dismiss it in January 2012 because of a forum-selection clause.

The clause said the Olivieri firm could only be sued in the state in which it has its principal office for business. The trial court found that to be New Jersey, as well as finding the clause was enforceable under the 2009 decision in Caperton v. A.T. Massey Coal Co., Inc.

In that case, Harman Mining owner Hugh Caperton sued Massey in Boone County and received a $50 million verdict. Ultimately, though, the state Supreme Court found that a forum-selection clause in the agreement at issue required any lawsuit to be brought in Virginia.

During the case, Caperton charged that now-Chief Justice Brent Benjamin shouldn’t participate in the case because former Massey CEO Don Blankenship spent millions of dollars in support of his 2004 campaign.

The U.S. Supreme Court agreed, and Benjamin was forced to disqualify himself from the case. Caperton later re-filed the case in Buchanan County Circuit Court in Virginia.

In the Olivieri firm’s case, the court used four factors determined by the Caperton case.

The court ruled the clause was not “snuck in” the contract, as the plaintiffs argued; that the clause was specified with mandatory terms; that all litigants were bound by the contract; and that enforcing the clause would not deprive the plaintiffs of a remedy.

Justice Robin Davis dissented.

From the West Virginia Record: Reach John O’Brien at jobrienwv@gmail.com.

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