An employment contract that gave Texas’s courts jurisdiction over any disputes between a Greenville man and his employer didn’t require the employee to bring his dispute over unpaid wages in Texas’ courts or preclude him from filing suit in South Carolina for alleged violations of state law, the South Carolina Court of Appeals has ruled.
Matthew Rowe formed Covalent Chemical, which was incorporated in Texas and headquartered in North Carolina. In 2015 Rowe offered Glenn Howell, who lived in Greenville, a job as a sales representative. The two men signed an employment contract which provided that the contract would be governed by the law of Texas, and that parties agreed to the jurisdiction of that state’s courts.
During his employment at Covalent, Howell’s primary sales territory was South Carolina, and he never traveled to Texas except to attend a single trade show. In 2018, Howell sued Rowe and Covalent in Greenville County Circuit Court seeking relief under South Carolina’s Payment of Wages Act, alleging that the company had failed to pay him compensation he was owed. Letitia H. Verdin granted the defendants’ motion to dismiss on the grounds that South Carolina was an improper venue.
Howell appealed, arguing that the plain language of the forum selection provision didn’t require the parties to litigate their contractual disputes exclusively in Texas because it contained no mandatory language. In a Nov. 3 opinion written by Judge John D. Geathers, the Court of Appeals agreed and reversed and remanded the case.
Under Texas case law, if a forum selection doesn’t clause expressly provides for a forum’s exclusive jurisdiction, the courts won’t assume that the parties intended to submit to exclusive jurisdiction in that forum. In Howell’s case, the language in the forum selection clause at issue was clearly permissive rather than mandatory, Geathers wrote, and a permissive forum selection clause doesn’t justify dismissal on the grounds that the plaintiff filed suit in a forum other than the one specified in the clause.
Since the case was reversed on those grounds, the court declined to consider Howell’s argument that the employment agreement’s choice of law provision violates the South Carolina policies expressed in the Payment of Wages Act, which prohibits private contracts from attempting to set aside its provisions.
David Eliot Rothstein of Greenville represented Howell. Joseph Owen Smith of Smith Hudson Law in Greenville represented Covalent Chemical and Rowe
The seven-page decision is Howell v. Covalent Chemical, LLC (Lawyers Weekly No. 011-087-21). The full text of the opinion is available online at sclawyersweekly.com.
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