June 13, 2012

Defining Forum and Venue in the American Court System

This blog post is part of an ongoing series examining how a seastead might limit being sued in the court system of the United States of America. I am Robert Mongole, a Juris Doctor and Doctor of Civil Law candidate at the Louisiana State University Paul M. Hebert Law Center, and I am conducting this investigation in conjunction with The Seasteading Institute.

Forum and venue selection clauses may or may not apply under different laws, but before examining this, an understanding of what each of these terms mean is required. The pair of terms are often confused by the lower courts. Contractual devices limiting the places where suits are brought are often referred to as “forum selection clauses” regardless if it limits forum, venue or both.

According to Black’s Law Dictionary, forum is a “court or other judicial body; a place of jurisdiction,” while venue is “[t]he territory, such as a country or other political subdivision, over which a trial court has jurisdiction.” Put into plain English, this means a forum selection clause chooses the court the trial will occur in and a venue selection clause chooses the geographic location of the trial.

Early seasteads will likely fly flags of convenience. Panama, Liberia, the Bahamas, Bermuda, Cyprus, and the Marshall Islands have all been listed as possibilities. It makes sense that a seastead might want to force all claims against it to be heard in the country of the flag it flies. It might further limit the geographic area within one of the countries so it is not defending itself in multiple geographic areas within the country. A contractual clause that limits suit to one of these countries or a geographic area within one of these countries is a venue selection clause.

It also makes sense that a seastead might want to limit its suit to a federal court within one of these nations to avoid having different local laws applied to multiple suits. This is properly considered a forum selection clause. A seastead might want to combine the two of these and limit suits. For example, a clause stating a claimant must bring his suit in the First Circuit in the Province of Panama is both a forum and venue selection clause, because it limits the claimant’s choice of both geographic location and adjudicative body.

Leave a comment below, or read on to part 3.