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Tayman v. 5 Tides Home Inspections, LLC

United States District Court, D. Maine

June 27, 2019

CINDY S. TAYMAN, in her capacity as Trustee of the Tayman Revocable Trust, et al., Plaintiffs
v.
5 TIDES HOME INSPECTIONS, LLC, et al., Defendants

          DECISION AND ORDER ON MOTION TO DISMISS

          D. BROCK HORNBY UNITED STATES DISTRICT JUDGE.

         This is a lawsuit against a home inspector, a home inspection service, a real estate broker agency and two of its brokers. The Massachusetts plaintiffs purchased a house in Raymond, Maine which, they say, had all kinds of serious defects that were not disclosed and that will require expenditure of well over $100, 000. They seek damages against all the defendants. Jurisdiction is based on diversity of citizenship.

         The home inspector and the home inspection service defendants have moved to dismiss the complaint against them under Fed.R.Civ.P. 12(b)(6) on the basis that the purchasers entered into a contract with them that, through a forum selection clause and a separate venue selection clause, prevents this court from hearing the case against them.

         These two defendants ultimately may succeed on their argument if the facts are as they say they are but, at this stage, the record does not permit me to rule in their favor. I therefore Deny the motion.

         Factual and Procedural Background

         The plaintiffs attach to their Complaint what purports to be a contract for home inspection services, Exhibit D. Exhibit D is a badly cobbled-together document. (I hope that no lawyer is responsible for having drafted it.) The first page is entitled “Inspection Agreement” and features the logo of 5 Tides Home Inspections. It begins: “This is an Agreement between you, the undersigned Client, and us, the Inspector, pertaining to our inspection of the Property at: 79 Tarkin Hill Rd Raymond, ME. The terms below govern this Agreement.” The “Client” obviously is the plaintiff house purchasers. From all appearances “us, the Inspector” is 5 Tides Home Inspections whose logo is prominently featured at the outset of the Agreement. This part of the document goes on to provide for fees and inspection services. At paragraph 9 it states: “You agree that the exclusive venue for any litigation arising out of this Agreement shall be in the county where we have our principal place of business.” Compl. Ex. D at p. 2 (ECF No. 1-4).

         After seventeen numbered paragraphs (1 through 17), there appears to be an additional agreement that begins with the statement: “THIS AGREEMENT made this 18th day of May, 2018, by and between David Setchell (‘INSPECTOR') and the undersigned (‘CLIENT'), collectively referred to herein as ‘the parties.' The Parties Understand and Voluntarily Agree as follows[.]” It then provides the same property address and provides for water testing services. It starts the paragraph numbering sequence anew, and goes on for 12 numbered paragraphs (1 through 12). This sequence has another paragraph 9. This second paragraph 9 states: “The parties agree that any litigation arising out of this Agreement shall be filed only in the Court having jurisdiction in the County in which the INSPECTOR has its principal place of business.”

         So there are both a venue selection clause and a forum selection clause in this document.

         The plaintiffs' Complaint alleges that the defendant Setchell resides in Maine, Compl. ¶ 2 (ECF No. 1), and that 5 TIDES is a limited liability company with its principal place of business in Maine, id. ¶ 3. It does not allege a County for either defendant. The Complaint also asserts that the two defendants maintain a website at https://5tidesinspections.com. Id. ¶ 4.

         The two home inspection defendants filed their motion to dismiss for failure to state a claim, asserting that the principal place of business for both is in Kennebec County, Maine, and therefore that this court has no jurisdiction on account of the venue and forum selection clauses.

         Analysis

         Confronted with a 12(b)(6) motion, a court can consider “documents expressly incorporated into the complaint and documents the authenticity of which is not disputed by the parties, official public records, documents central to the plaintiff's claim, and documents sufficiently referred to in the complaint.” Nicholson v. Prudential Ins. Co. of Am., 235 F.Supp.2d 22, 26 n.2 (D. Me. 2003). Exhibit D is therefore an eligible document. The defendants argue that because the Complaint refers to a website, I can also refer to that website and determine that their principal place of business is in Kennebec County. They argue: “The website contains contact information including 5 Tides['s] address at P.O. Box 21, South Gardiner, ME 04359. South Gardiner is in Kennebec County, Maine.” Mot. to Dismiss at p. 2-3 (ECF No. 17). But a contact post office box address on a website is no evidence at all of where either of the two defendants maintains a principal place of business, which-for legal and jurisdictional purposes-has long been defined as the entity's “nerve center” (i.e., the location responsible for coordinating the business). See, e.g., Hertz. Corp. v. Friend, 599 U.S. 77, 92 (2010). Even if their contract document uses the phrase “principal place of business” more colloquially, a post office box contact site on a website does not qualify. Maybe in fact the principal place of business for each is in Kennebec County, but the current record does not permit me to accept that assertion.

         Moreover, even if it is Kennebec County, that fact will not make the forum selection clause (the second paragraph 9) applicable in the way defendants wish. That clause provides that “any litigation . . . shall be filed only in the Court having jurisdiction in the County in which the INSPECTOR has its principal place of business.” Compl. Ex. D at p. 4. This federal court for the District of Maine has jurisdiction in Kennebec County, Maine. This federal forum therefore satisfies the second paragraph 9.

         The defendants say that Fornaro v. RMC/Resource Mg. Co., 201 Fed.Appx. 783 (1st Cir. 2006), stands for the contrary conclusion. Fornaro was a case where the forum selection clause stated: “The jurisdiction of any lawsuits related to or arising out of this contract will be in the courts of Carroll County, New Hampshire.” Id. at 783. The First Circuit said that phraseology-“the courts of Carroll County, New Hampshire”-was “at best, a strained way to describe the federal court and one that we do not accept as a reasonable interpretation. It is far more likely that the parties intended the phrase ‘courts of Carroll County, New Hampshire' to mean the courts that trace their origin to the state, i.e., the Carroll County, New Hampshire state courts, of which there are the Carroll County Superior Court and two District Courts . . ...


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