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Sunday, October 23, 2016

Misplacing Benton Harbor results in dismissal of action

January 2, 2004

The U.S. Court of Appeals for the Seventh Circuit upheld the trial court’s decision to dismiss an admiralty action filed in the wrong district. In the instant case, plaintiff contracted to have cold-rolled steel shipped from Belgium to Benton Harbor, Indiana. The bills of lading provided, in pertinent part, that any action was to be brought in the federal district court having admiralty jurisdiction at the U.S. port of discharge. Plaintiff brought suit in federal court in Chicago. Defendant ship owner filed motions to dismiss for improper venue. Plaintiff argued, among other things, that Benton Harbor was within the "Port of Chicago" for purposes of Customs regulations. It also argued that the district court should have transferred the actions, rather than dismissing them, as the statute of limitations had run in the interim. On appeal, the court held that, in admiralty cases, forum selection clauses are prima facie valid and should be enforced unless the provisions are unreasonable. Here, the court determined that plaintiff was commercially sophisticated and is presumed to know where Benton Harbor is located. Continental Ins. Co. v. M/V Orsula, No. 03-1721 (7th Cir., December 24, 2003). (Source: HK Law)

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