Supreme Court, Suffolk County, August 29, 2022

Bellavia Blatt, PC, Mineola (Diana Patricia Dileonardo of counsel), for plaintiff.

Casey & Barnett, LLC, New York City (Christopher Schierloh of counsel), for defendant.

Upon due deliberation it is ordered that for the reasons set forth herein, the plaintiff's motion (mot seq 001) for a preliminary injunction is denied under the circumstances presented (CPLR 6301). The temporary restraining order issued in connection with this motion is vacated and set aside. It is further ordered that the defendant's motion (mot seq 002) for dismissal of the complaint is granted (CPLR 3211 [a] [1]). It is further ordered that the plaintiff's complaint is dismissed.

The plaintiff Spellmans Marine Inc. (hereinafter referred to as Spellmans) is a boat dealer located in Suffolk County, New York. Plaintiff entered into a contract with the defendant HC Composites LLC, doing business as World Cat (hereinafter referred to as World Cat), manufacturer to sell the latter's watercraft (NY St Cts Elec Filing [NYSCEF] Doc No. 5, plaintiff's exhibit B). This was an exclusive agreement whereby World Cat covenanted that it would set aside a specific geographic area for the plaintiff's retail sales. The defendant is attempting to exercise the non-renewal clause of the contract. Desiring to maintain the dealership relationship, the plaintiff has commenced the lawsuit at hand sounding, inter alia, in breach of contract. In its complaint, Spellmans seeks a judgment against defendant for permanent injunctive relief preventing World Cat from terminating the parties' dealer agreement relating to the marketing of the defendant's boats. Plaintiff also seeks money damages predicated on an alleged violation of the New York General Business Law (§§ 810-816), the "Vessel Dealer Act." It is further averred that the defendant breached the duty of good faith and fair dealing implied in the parties' dealer agreement and violated its fiduciary duty to the plaintiff. To preserve its status as a World Cat dealer during the pendency of this case, Spellmans has moved (mot seq 001) for a preliminary injunction (CPLR 6301). The defendant has cross-moved (mot seq 002) for an order of dismissal (CPLR 3211 [a] [1]).{**77 Misc 3d at 320}

The court would be remiss if it did not thank counsel for their thorough and eloquent briefs. As noted by the court at the conclusion of oral argument, their respective clients were well served by such advocates.

In the case of Merling v Ash Dev., LLC (198 AD3d 743, 745 [2d Dept 2021]), the Court held "[t]he party seeking a preliminary injunction must demonstrate (1) a likelihood of success on the merits, (2) danger of irreparable harm in the absence of an injunction, and (3) a balance of the equities in favor of the injunction" (see 159 Smith, LLC v Boreum Hill Prop. Holdings, LLC, 191 AD3d 741, 742 [2021]; Arcamone-Makinano v Britton Prop., Inc., 83 AD3d 623, 624 [2011]). "The purpose of a preliminary injunction is to preserve the status quo until a decision is reached on the merits" (159 Smith, LLC v Boreum Hill Prop. Holdings, LLC, 191 AD3d at 742 [internal quotation marks omitted]; see Arcamone-Makinano v Britton Prop., Inc., 83 AD3d at 624).

Prior to discussing the question of injunctive relief, however, the court must first consider the defendant's cross motion which challenges New York as the proper forum for this dispute and seeks dismissal of the complaint.

In determining the viability of a CPLR 3211 (a) (1) motion, the Court in Encore Lake Grove Homeowners Assn., Inc. v Cashin Assoc., P.C. (111 AD3d 881, 882 [2d Dept 2013]) stated: "A motion to dismiss a complaint based upon documentary evidence may be appropriately granted only where the documentary evidence utterly refutes the plaintiff's factual allegations, conclusively establishing a defense as a matter of law." (Id., citing Nunez v Mohamed, 104 AD3d 921, 922 [2d Dept 2013]; see Leon v Martinez, 84 NY2d 83, 88 [1994]; Cervini v Zanoni, 95 AD3d 919, 920-921 [2d Dept 2012]; Rubinstein v Salomon, 46 AD3d 536, 539 [2d Dept 2007]; Shaya B. Pac., LLC v Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 38 AD3d 34, 38 [2d Dept 2006]; see also Board of Mgrs. of 100 Congress Condominium v SDS Congress, LLC, 152 AD3d 478 [2d Dept 2017].) "To succeed on a motion to dismiss pursuant to CPLR 3211 (a) (1), the documentary evidence that forms the basis of the defense must be such that it resolves all factual issues as a matter of law, and conclusively disposes of the plaintiff's claim" (B&A Realty Mgt., LLC v Gloria, 192 AD3d 851, 853 [2d Dept 2021], quoting Teitler v Pollack & Sons, 288 AD2d 302, 302 [2d Dept 2001]; see Held v Kaufman, 91 NY2d 425, 430-431 [1998]; Leon v Martinez; Museum Trading Co. v Bantry, 281 AD2d 524 [2d{**77 Misc 3d at 321} Dept 2001]; Jaslow v Pep Boys—Manny, Moe & Jack, 279 AD2d 611 [2d Dept 2001]; Brunot v Eisenberger & Co., 266 AD2d 421 [2d Dept 1999]).

The proffered document "must be unambiguous and of undisputed authenticity" (Fontanetta v John Doe 1, 73 AD3d 78, 86 [2d Dept 2010]). Acceptable proof includes "mortgages, deed[s], contracts, and any other papers, the contents of which are essentially undeniable" (Carr v Wegmans Food Mkts., Inc., 182 AD3d 667, 668 [3d Dept 2020]). It is also beyond cavil that "[a]s a term of the contract between the parties . . . a contractual forum selection clause is documentary evidence" (Lischinskaya v Carnival Corp., 56 AD3d 116, 123 [2d Dept 2008] [citations omitted]).

In support of its cross motion, World Cat relies upon the language in articles 10 and 11 of the dealership agreement.

The court must decide if the aforementioned provisions in the contract allow for New York to hear this dispute in addition to our sister state of North Carolina.

Forum selection clauses fall into two categories, mandatory and permissive (Boss v American Express Fin. Advisors, Inc., 6 NY3d 242 [2006]). "[M]andatory forum selection clauses . . . provide that the specified forum is the exclusive or sole forum in which the matter may be heard" (Walker, Truesdell, Roth & Assoc., Inc., Trustee of Greenwich Sentry, L.P. Litig. Trust v Globeop Fin. Servs. LLC, 43 Misc 3d 1230[A], 2013 NY Slip Op 52318[U], *3 [Sup Ct, NY County 2013, Friedman, J.], affd sub nom. New Greenwich Litig. Trustee, LLC v Citco Fund Servs. [Europe] B.V., 145 AD3d 16 [1st Dept 2016]). A permissive clause allows a party the option of suing either in the designated forum or "in another forum having jurisdiction over the defendants" (Walker, Truesdell, Roth & Assoc., Inc., 2013 NY Slip Op 52318[U], *3, citing Orix Credit Alliance, Inc. v Mid-South Materials Corp., 816 F Supp 230 [SD NY 1993]).

In the case before us, the forum clause in the World Cat dealership agreement states:

"ARTICLE 10: GOVERNING LAW AND VENUE 10.1 This Agreement is made and entered into in Tarboro, North Carolina. This Agreement shall be construed and governed by the laws of the State of Florida without giving regards to its conflict of laws provisions. Dealer consents to the exclusive jurisdiction and venue of the state court in Edgecombe County, North Carolina for any lawsuit arising from{**77 Misc 3d at 322} or relating to this Agreement or the Parties' relationship, and Dealer hereby waives any objections Dealer may have to jurisdiction and venue of the lawsuit."

There is a body of case law which collectively opines that a forum selection clause is mandatory when the parties agree "that a specified forum 'shall' hear a matter or that the forum is 'exclusive' " (Walker, Truesdell, Roth & Assoc., Inc., 2013 NY Slip Op 52318[U], *3, citing Micro Balanced Prods. Corp. v Hlavin Indus., 238 AD2d 284, 284-285 [1st Dept 1997], Erie Ins. Co. of N.Y. v AE Design, Inc., 104 AD3d 1319, 1320 [4th Dept 2013], lv denied 21 NY3d 859 [2013], Investools Inc. v Waltz, 2006 NY Slip Op 30120[U] [Sup Ct, NY County 2006], and Hur v Carvel Corp., 2001 NY Slip Op 40364[U],*2 [Sup Ct, Nassau County 2001]).

The language in article 10 of the contract, i.e., "consents to the exclusive jurisdiction and venue" of North Carolina, can have only one interpretation. The forum selection clause is mandatory. The plaintiff does not dispute that this provision is in the contract. Spellmans' position is that the articles in the agreement relating to forum and venue are unenforceable due to New York General Business Law §§ 810-816 (the "Vessel Dealer Act"). This statute provides protections to a boat dealer vis-à-vis a manufacturer.

Specifically, General Business Law § 812 requires that notice of intention to exercise a non-renewal provision in a contract be given 90 days prior to terminating the agreement. General Business Law § 815 details penalties for noncompliance. It also includes the following language: "4. The provisions of this article shall be in addition to any legal or equitable right that any party has pursuant to any other provision of law or pursuant to any agreement between the parties." General Business Law § 816 states, "No manufacturer or distributor shall, as a condition of entering into any agreement or contract with a dealer or in any dealer agreement, require any dealer to waive any provision or right granted pursuant to this article."

The above-mentioned statutes clearly detail protections for the plaintiff that do not exist under the terms of the contract. The question to be resolved is whether they serve to mandate that this case remain in New York. For the reasons discussed below, the court must decide this issue in favor of the defense.

In the oft cited case of Brooke Group v JCH Syndicate 488 (87 NY2d 530 [1996]) the Court stated:{**77 Misc 3d at 323}

"Although once disfavored by the courts, it is now recognized that parties to a contract may freely select a forum which will resolve any disputes over the interpretation or performance of the contract. Such clauses are prima facie valid and enforceable unless shown by the resisting party to be unreasonable." (Id. at 534 [citations omitted].)

Defense counsel relies on the holding in Boss v American Express Fin. Advisors, Inc., in support of the contention that the forum selection clause in this case is enforceable notwithstanding the existence of a New York statute which affects the substantive rights of the parties. The Court in Boss was called upon to decide the enforceability of a forum selection clause which stated that any action arising from a dispute had to be brought in a Minnesota court (id. at 245). The plaintiff in Boss argued that since the defendant's actions were in violation of the New York Labor Law, the case should be maintained in New York. The laws and regulations that were relied upon (Labor Law §§ 193 [1]; 198-c; 12 NYCRR 195.1) by the plaintiff in Boss were comprehensive, forbidding "deductions of more than 10% from an employee's wages" (id. at 246-247). Additionally, the Labor Law conferred a right upon affected employees allowing them to file a complaint with the Commissioner of Labor (Labor Law § 196-a). On that basis, the plaintiff contended, the forum selection clause was unenforceable. The Court disagreed stating "objections to a choice of law clause are not a warrant for failure to enforce a choice of forum clause" (id. at 247). The Court also noted that it did not reach the merits of whether the Labor Law abrogated inconsistent provisions of the contract. Instead, the Court stated that such an argument

"should have been made to a court in Minnesota—the forum the parties chose by contract. If New York's interest in applying its own law to this transaction is as powerful [*2]as plaintiffs contend, we cannot assume that Minnesota courts would ignore it, any more than we would ignore the interests or policies of the State of Minnesota where they were implicated" (id. at 247).

Spellmans' attempts to distinguish the holding in Boss by pointing out that the language in the Labor Law and the Vessel Dealer Act is different and thus warrants a different holding by this court.{**77 Misc 3d at 324}

This appears to be the first case interpreting the Vessel Dealer Act in connection with the viability of a forum selection clause between a boat manufacturer and dealer.

When interpreting a statute, it is incumbent on the court to implement the intent of the legislature (People v Badji, 36 NY3d 393, 398 [2021]; see State of New York v Patricia II., 6 NY3d 160, 162 [2006]; Matter of Hummel, 20 Misc 3d 879, 880-881 [Sup Ct, Albany County 2008]).

The court is mindful of its limited role in applying the law and not engaging in judicial legislation under the guise of interpretation. This is simply a recognition of the guiding principle which obliges us to look at the language of the statute and no further, unless necessary. "Where the terms of a statute are clear and unambiguous, 'the court should construe it so as to give effect to the plain meaning of the words used' " (Matter of Auerbach v Board of Educ. of City School Dist. of City of N.Y., 86 NY2d 198, 204 [1995], citing Patrolmen's Benevolent Assn. of City of N.Y. v City of New York, 41 NY2d 205, 208 [1976]). The court is under a duty to give as much effect as possible to all the words in the statute and read them in harmony with each other (Loehr v New York State Unified Ct. Sys., 150 AD3d 716, 720 [2d Dept 2017]). Only if discordant language requires the court's discerning intervention to prevent "absurd or unreasonable consequences" will inquiry into the legislative history be permitted (Auerbach at 204, citing Doctors Council v New York City Employees' Retirement Sys., 71 NY2d 669, 674-675 [1988]). This rule is not absolute as pointed out by the Court in Riley v County of Broome (95 NY2d 455, 463 [2000]); "the legislative history of an enactment may also be relevant and is not to be ignored, even if words be clear" (id. at 463 [citation and internal quotation marks omitted]; People v Badji at 399).

The legislative intent of the Vessel Dealer Act can be found in the notes contained within Bill Jacket, Laws of 2004, chapter 686, since the act itself does not have a discussion of legislative purpose (2004 NY Senate Bill S6610-C, 2004 NY Assembly Bill A10358-A, enacted as L 2004, ch 686). A perusal of the Bill Jacket notes fails to indicate any importance to New York maintaining itself as the exclusive forum to enforce the act.

Turning back to the language contained in the Vessel Dealer Act, there is a section which bears examination. General Business Law § 814 states:

"A cause of action to enforce the provisions of this{**77 Misc 3d at 325} article may be commenced in any court having jurisdiction over such action or may be resolved through arbitration pursuant to arbitration standards recognized by the American Arbitration Association. Every arbitration conducted pursuant to this article shall be conducted in this state" (emphasis added).

The court singled out the final sentence in this law to highlight its limitation.

To demonstrate the legislature showing an intent to retain litigation in New York, let us compare the above statute with the provisions found in General Business Law article 35-E (the Prompt Payment Act). General Business Law § 757 reads: [*3]

"The following provisions of construction contracts shall be void and unenforceable:

"1. A provision, covenant, clause or understanding in, collateral to or affecting a construction contract, with the exception of a contract with a material supplier, that makes the contract subject to the laws of another state or that requires any litigation, arbitration or other dispute resolution proceeding arising from the contract to be conducted in another state."

When General Business Law § 814 is placed side by side with General Business Law § 757, the paucity of the plaintiff's argument becomes manifest. "The failure of the Legislature to include a matter within a particular statute is an indication that its exclusion was intended" (Pajak v Pajak, 56 NY2d 394, 397 [1982]; McKinney's Cons Laws of NY, Book 1, Statutes § 74).

When the legislature specified that an arbitration proceeding under the Vessel Dealer Act had to take place exclusively in New York, the venerable doctrine "expressio unius est exclusio alterius" creates an "irrefutable inference" that the failure to include litigation within its prohibitions was intentional (McKinney's Cons Laws of NY, Book 1, Statutes § 240).

Accordingly, the forum selection clause in the contract between plaintiff and defendant is enforceable and requires this dispute to be heard in North Carolina. This holding does not foreclose the plaintiff from asserting that the Vessel Dealer Act supercedes the choice of law clause (art 10) in the subject contract. Such a claim, however, must be decided (as agreed upon) by a judge in Edgecombe County and not before this{**77 Misc 3d at 326} court (Boss at 247; see USA-India Export-Import, Inc. v Coca-Cola Refreshments USA, Inc., 46 Misc 3d 1215[A], 2015 NY Slip Op 50091[U] [Sup Ct, Westchester County 2015]). This determination brings the court to the conclusion that the cross motion for dismissal must be granted.

Since New York has been found to be the incorrect forum for this lawsuit, the motion for injunctive relief should be made in our sister state. The plaintiff's motion for a preliminary injunction will be denied as moot.

We have considered the remaining contentions of plaintiff's counsel and although they have been advanced with great vigor, they fail to persuade the court.