Home Court Advantage Makes a Difference For Clients

Commentary:

Those who bet the spread in football games know that the being the home team is worth three or so points. Teams fight all year to have home field advantage in the playoffs.

In lawsuits, being the home team also matters. If you are going to be sued, or if you intend to bring a lawsuit, it is better to be in your local courthouse where the judge is familiar (if not to you, at least to your attorneys) and the jury (if the case gets that far) will be your neighbors.

Imagine this situation. After much effort, you finally land that contract that you have been trying to get forever. The contract arrives and you give it a cursory glance. All the basic terms seem right – the price, the dates for performance, etc. But there is a funny clause that says something along the lines that all disputes under the agreement can only be enforced in Lackawanna County, Pa. You think that is strange, but not particularly important because, after all, this is the contract that is going to make this a great year.

Fast forward a few years. The contract is not going the way that you hoped and there is a significant dispute. You need to file a lawsuit, and your attorney does so in Nassau or Suffolk counties where your business is located. Next thing you know, your lawsuit is kicked out of court and you are told that if you want to sue, you have to do so in Pennsylvania. Now your attorney has to go to Scranton, Pa., start the lawsuit (perhaps with a local attorney to assist) and continue to travel there for the duration of the case. Your suit just got more expensive and less likely to succeed.

I have been to Lackawanna County on behalf of a fine Long Island business. The attorney on the other side’s brother was the local federal judge in town. The best friend of those brothers was the state court judge hearing our case. Everyone was very friendly. The beer was tasty. We settled – quickly.

Having your case heard locally has some real advantages. Both Nassau and Suffolk counties have a special commercial division with three dedicated judges who handle the commercial docket. The procedures followed in the commercial division are different than other divisions and are designed to be responsive to the specific needs of businesses and the types of disputes that arise in the business world. Very few other states have similar courts for business disputes.

So don’t just buy locally, sue locally too. It’s good for the economy and for your chances of being successful.

Lesson to be learned: Seemingly unimportant parts of a contract are important. “Forum selection clauses” can be critical if a lawsuit is necessary. If you have the leverage, insist on your local county as the required forum. If you don’t have the leverage, then try to neutralize any attempt to require the forum to be in the other side’s hometown.

This article was inspired by the recent decision of Justice Elizabeth Emerson in Supreme Court, Suffolk County, entitled Somerset Fine Home Building v Simplex Industries. In that case, a Suffolk County home builder had their case against a manufacturer of modular homes from Pennsylvania dismissed because the sales agreement provided for Pennsylvania as the exclusive location of any lawsuit.

This article appeared in the February 8, 2019, issue of Long Island Business News. ©2019 Long Island Business News