Carnival Cruise Lines, Inc. v. Shute

SCOTUSCase
Litigants=Carnival Cruise Lines, Inc. v. Shute
ArgueDate=January 15
ArgueYear=1991
DecideDate=April 17
DecideYear=1991
FullName=Carnival Cruise Lines, Incorporated v. Eulala Shute, et vir.
USVol=499
USPage=585
Citation=111 S. Ct. 1522; 113 L. Ed. 2d 622; 1991 U.S. LEXIS 2221; 59 U.S.L.W. 4323; 1991 AMC 1697; 91 Cal. Daily Op. Service 2729; 91 Daily Journal DAR 4419
Prior=Certiorari to the United States Court of Appeals for the Ninth Circuit
Subsequent=
Holding=The Court held that United States federal courts will enforce forum selection clauses so long as the clause is deemed fundamentally fair.
SCOTUS=1990-1991
Majority=Blackmun
JoinMajority=Rehnquist, White, O'Connor, Scalia, Kennedy, Souter
Dissent=Stevens
JoinDissent=Marshall
LawsApplied=Forum selection clause

"Carnival Cruise Lines, Inc. v. Shute", 499 U.S. 585 (1991),ref|citation was a case in which the Supreme Court of the United States held that United States federal courts will enforce forum selection clauses so long as the clause is not unreasonably burdensome to the party seeking to escape it.

Facts

The plaintiffs, Eulala and Russel Shute, were passengers on a cruise ship operated by the defendant, Carnival Cruise Lines, Inc. The Shutes had bought tickets in Washington and signed a contract, with a forum selection clause mandating that injured parties would sue in Florida, to the exclusion of all other jurisdictions. The plaintiffs boarded the cruise in California, and one was injured in international waters off the coast of Mexico. The plaintiffs then filed a lawsuit in Washington, in violation of the contract clause.

The defendant sought summary judgment based on:
# the forum selection clause, and
# a lack of minimum contacts between the defendant and the forum stateThe trial court dismissed based solely on the lack of sufficient contacts. The United States Court of Appeals for the Ninth Circuit reversed because the cruise line had reached into Washington via advertising, and held that but for the defendant's solicitation, there would be no cause of action. The Court of Appeals also held that forum selection clause was void because of unequal bargaining power between the parties, and because it would be an undue hardship for the Shutes to have to go all the way to Florida to sue. This decision was appealed to the Supreme Court based on that court's Admiralty jurisdiction.

Question presented

The Supreme Court limited the issue to whether the forum selection clause was enforceable.

Opinion of the Court

The Court, in an opinion by Justice Blackmun, held the Shutes to their deal. The Court noted that Florida is not a random jurisdiction - Carnival is headquartered there and does much business there, and Washington does not necessarily make sense in the context of an accident off the coast of Mexico on a ship that left from California. The hardship on the plaintiffs mattered little, as they had signed the contract, and no one forced them to go on a cruise. On the other hand, it made sense for the cruise industry, which carries passengers from all over, to have a single forum for lawsuits. The cruise line will thereby avoid defending itself in many different courts, which will save money, which will translate to cheaper tickets.

Dissent

Justice Stevens filed a dissenting opinion, joined by Justice Marshall. Stevens dissents for several reasons including objections to contracts of adhesion created by parties who have unequal bargaining power, the fact that the notice of the forum selection clause was not made available to the purchaser until after payment was tendered and a lack of an opportunity for refunds at the point when the forum selection clause was disclosed.

Stevens attached a copy of the original ticket to his dissent to show how only the most meticulous passenger would notice the clause and that notice might be in contention.

ee also

* List of United States Supreme Court cases, volume 499

External links

*ussc|499|585|Text of the opinion on Findlaw.com