forum-selection clause

Law Definition n

A clause in a contract stating that all disputes will be resolved in a particular court and waiving the right to file suit in any other.

A forum selection clause in a contract with a Conflict of Laws element allows the parties to agree that any litigation resulting from that contract will be initiated in a specific forum. There are three types of clause:

  • the reference might be to a particular court in a jurisdiction agreed upon by the parties (although, if the parties make a mistake as to the power of the nominated court to hear the matter, the civil procedures of the nominated jurisdiction will be applied to identify the appropriate court); or
  • the clause might refer to a specific kind of dispute resolution process, such as mediation, arbitration (see arbitration clause, lex loci arbitri), or a hearing before a special referee; or
  • the clause might refer to both, requiring a specific process to be carried out in a specific location.

A simple forum selection clause covering both the proper law of the contract and the forum for resolving disputes might read:

“This contract is governed by the laws of England and any dispute shall be finally resolved by the English courts.”

In many cross-border contracts, the forum for resolving disputes may not be the same as the country whose law governs the contract. And the contract may provide for a staged procedure for resolving disputes.