Jones Sign Co., Inc. v. Consensus Construction & Consulting, Inc.

COURT OF APPEALS
DECISION NOTICE
DATED AND FILED This opinion is subject to further editing. If
published, the official version will appear in
the bound volume of the Official Reports.
November 3, 2020
A party may file with the Supreme Court a
Sheila T. Reiff petition to review an adverse decision by the
Clerk of Court of Appeals Court of Appeals. See WIS. STAT. § 808.10
and RULE 809.62.

Appeal No. 2019AP2189 Cir. Ct. No. 2017CV30

STATE OF WISCONSIN IN COURT OF APPEALS
DISTRICT III

JONES SIGN CO., INC.,

PLAINTIFF-RESPONDENT,

V.

CONSENSUS CONSTRUCTION & CONSULTING, INC.,

DEFENDANT-APPELLANT.

APPEAL from a judgment of the circuit court for Brown County:
THOMAS J. WALSH, Judge. Reversed.

Before Stark, P.J., Hruz and Seidl.

Per curiam opinions may not be cited in any court of this state as precedent

or authority, except for the limited purposes specified in WIS. STAT. RULE 809.23(3).

¶1 PER CURIAM. Consensus Construction & Consulting, Inc.,
appeals a money judgment in favor of Jones Sign Co., Inc. Consensus asserts the
No. 2019AP2189

circuit court erred by refusing to enforce a forum selection clause contained in the
parties’ contract identifying the courts of South Carolina as the proper place to
litigate disputes under the contract. We agree that the forum selection clause must
be given effect and that Jones Sign’s complaint should have been dismissed.
Accordingly, we reverse.

BACKGROUND

¶2 The material facts relevant to this appeal are undisputed. Consensus
is a South Carolina corporation that contracted with Horry Georgetown Technical
College (HGTC) to fabricate and install signage on HGTC’s campuses in South
Carolina. Consensus entered into a subcontract with Jones Sign to fabricate and
install certain signs.

¶3 HGTC was dissatisfied with Jones Sign’s work and complained to
Consensus. Jones Sign performed additional work, but Consensus withheld
payment on the final invoice that Jones Sign had submitted. Ultimately, another
entity was hired to complete the work.1 The situation led to HGTC withholding
payment to Consensus, a dispute that was ultimately resolved by the South
Carolina State Fiscal Accountability Authority in Consensus’s favor.

¶4 Jones Sign then filed the present action against Consensus in
Wisconsin, seeking a money judgment in the amount withheld by Consensus.2
Consensus filed a motion to dismiss, citing a lack of subject matter and personal

1
The parties disagree on whether Consensus terminated Jones Sign or Jones Sign
“walked off” the project. This disagreement is immaterial to the basis for our decision.
2
By an amended complaint, Jones Sign added a claim relating to additional costs for
signs that were not included on the final invoice.

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jurisdiction and asserting that the subcontract required that all disputes involving
that contract to be resolved by the courts of South Carolina. The circuit court
denied the motion and resolved the merits of the suit through decisions in which it
granted summary judgment to Jones Sign. The court denied Consensus’s motion
for reconsideration and entered a judgment in favor of Jones Sign. Consensus now
appeals.

DISCUSSION3

¶5 Consensus presents three threshold jurisdictional issues for our
review. It argues the circuit court lacked authority to reach a judgment because it
did not possess subject matter jurisdiction, it lacked personal jurisdiction over
Consensus, and it was an improper forum in which to resolve the parties’ dispute.
As explained below, we reject Consensus’s assertion that the court lacked subject
matter jurisdiction and we assume without deciding that the court could exercise
personal jurisdiction over Consensus. We conclude, however, that the court erred
by not enforcing a valid, unambiguous forum selection clause contained in the
parties’ contract.

A. Subject Matter Jurisdiction

¶6 Consensus, in passing, makes references to the circuit court’s “lack
of subject matter jurisdiction, and/or competency.” In Wisconsin, no circuit court
is without subject matter jurisdiction to entertain actions of any nature whatsoever.

3
The parties’ briefs raise a multitude of issues that we need not address based on our
conclusion that, as a matter of contract law, the proper forum state for this action is South
Carolina. See Maryland Arms Ltd. P’ship v. Connell, 2010 WI 64, ¶48, 326 Wis. 2d 300, 786
N.W.2d 15.

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Village of Trempealeau v. Mikrut, 2004 WI 79, ¶8, 273 Wis. 2d 76, 681 N.W.2d
190; see also WIS. STAT. § 801.04(1) (2017-18).4 A court may, however, lack
competency to adjudicate a particular dispute based upon a failure to comply with
statutory requirements pertaining to the exercise of jurisdiction. Mikrut, 273
Wis. 2d 76, ¶9. Consensus provides no basis for a conclusion that the circuit court
lacked competency in this case—other than its assertion that this suit was brought
in the wrong forum, an argument that we address below. Accordingly, we
conclude the circuit court possessed subject matter jurisdiction to hear this dispute.

B. Personal Jurisdiction

¶7 Personal jurisdiction over a party is required by WIS. STAT.
§ 801.04(2), which provides that judgment may be entered against a particular
person only if one or more of the jurisdictional grounds set forth in WIS. STAT.
§ 801.05 are established. If the statutory requirements are satisfied, the court must
then consider whether the exercise of jurisdiction comports with due process
requirements. Kopke v. A. Hartrodt S.R.L., 2001 WI 99, ¶8, 245 Wis. 2d 396, 629
N.W.2d 662.

¶8 Here, the circuit court concluded that personal jurisdiction was
appropriate under WIS. STAT. § 801.05(5)(a) and (b). Subsection (5)(a) confers
personal jurisdiction when, as relevant here, the suit “[a]rises out of a promise,
made anywhere to the plaintiff … by the defendant … to pay for services to be
performed in this state by the plaintiff.” Subsection (5)(b) confers personal
jurisdiction if the action “[a]rises out of … services actually performed for the

4
All references to the Wisconsin Statutes are to the 2017-18 version unless otherwise
noted.

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defendant by the plaintiff within this state if such performance within this state
was authorized or ratified by the defendant.”

¶9 Consensus argues these provisions do not confer personal
jurisdiction because the only service arguably promised or performed by
Jones Sign in Wisconsin was sign fabrication. Additionally, Consensus asserts
this fact was established only through the affidavit of Jones Sign’s counsel, who
lacked personal knowledge of the matter. Finally, Consensus argues that even if
there was a statutory basis for personal jurisdiction, it lacked sufficient contacts
with Wisconsin to subject it to suit here as a matter of due process.

¶10 We assume without deciding that the exercise of personal
jurisdiction over Consensus satisfied both the statutory and due process standards.
We make this assumption because a much narrower issue resolves this appeal—
namely, the specific contract between the parties here designates South Carolina as
the forum state in which actions must be brought. “[W]e decide cases on the
narrowest possible grounds.” Patrick Fur Farm, Inc. v. United Vaccines, Inc.,
2005 WI App 190, ¶8 n.1, 286 Wis. 2d 774, 703 N.W.2d 707.

C. Choice of Forum

¶11 Although a plaintiff’s choice of the forum is generally entitled to
great weight, such “favoring” of the plaintiff’s choice does not apply if the forum
is selected as a matter of contract. Converting/Biophile Labs., Inc. v. Ludlow
Composites Corp., 2006 WI App 187, ¶¶21-22, 296 Wis. 2d 273, 722 N.W.2d
633. A contract’s forum selection clause is presumptively valid in Wisconsin and
will be enforced unless it is demonstrated to be unconscionable or a violation of a
public policy. Id., ¶22. The contractual language must clearly indicate the

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parties’ intention to waive jurisdiction in other appropriate forums in favor of the
forum the parties have chosen. Id., ¶23.

¶12 The subcontract here has two provisions regarding the proper forum
for resolving disputes, with the applicable provision depending on whether the
dispute concerns the “correlative rights and duties of [the] Owner.” The parties
appear to agree that the only potentially applicable provision is the one not
implicating HGTC’s rights and duties. That provisions states:

If a dispute should arise between Contractor and
Subcontractor under or relating to the Subcontract, or the
breach thereof, which does not involve the correlative
rights and duties of Owner and is not, therefore, controlled
by the foregoing provision, then either party may seek
redress of its grievances as to such disputes at law or in
equity in a court of competent jurisdiction located in the
State in which the Project is located.

The “Project” is defined as “HGTC Exterior Signage – Grand Strand and
Georgetown Campuses,” and it is undisputed that the “Project” is located in South
Carolina.

¶13 The parties disagree about the meaning of the foregoing forum
selection clause. Consensus argues it means that any suits concerning the meaning
of the subcontract or a breach of its provisions must be brought in South Carolina.
Jones Sign, apparently emphasizing the provision’s use of the word “may,” argues
the clause is “permissive” and allows such suits to be brought anywhere
jurisdiction would be appropriate, including South Carolina.

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¶14 To resolve this disagreement, we must interpret the contract.5 We
give contract language its plain or ordinary meaning. Tufail v. Midwest Hosp.,
LLC, 2013 WI 62, ¶28, 348 Wis. 2d 631, 833 N.W.2d 586. “Where the terms of
the contract are clear and unambiguous, we construe the contract according to its
literal terms.” Id., ¶26. Conversely, when a contract is ambiguous, extrinsic
evidence concerning the parties’ intent may be used to discern meaning. Id., ¶27.
A contract is ambiguous if it is susceptible to more than one reasonable
interpretation. Id.

¶15 We conclude the contract here is unambiguous, and it requires that
any lawsuit relating to the subcontract or a breach thereof must be litigated in
South Carolina. “May,” as used in this context, refers to a party’s decision to
“seek redress of its grievances”; in other words, a party need not litigate a dispute
concerning the subcontract, but it if it does litigate, it must do so in a “court of
competent jurisdiction” in South Carolina. Contrary to Jones Sign’s reading of the
choice of forum provision, resort to the jurisdiction of the South Carolina courts is
not optional. The contract is a sufficiently clear statement of the parties’ intent to
vest the courts of South Carolina with exclusive jurisdiction to entertain an action
relating to the subcontract. Accordingly, the circuit court erred when it failed to
give the forum selection clause effect.

5
The subcontract contains a choice of law provision that requires application of South
Carolina law to “matters relating to the validity, performance, or interpretation” of the
subcontract. Neither party asserts South Carolina law materially differs from Wisconsin’s as
relevant to our exercise of contract interpretation.

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By the Court.—Judgment reversed.

This opinion will not be published. See WIS. STAT. RULE
809.23(1)(b)5.

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