Forum-Selection Clauses

Forum Selection Clause

A forum-selection clause is the term in a contract which “seeks to provide a court with ‘personal jurisdiction’ and to establish ‘venue.’” Put another way, it is an agreement by the parties as to where they would like to litigate the disputes between them arising out of the subject matter that is within the scope of the forum-selection clause. What does that even mean? Here is an example:

All actions or proceedings arising directly or indirectly from this Agreement shall be litigated in courts located within the Chicago, Illinois. The parties consent to the jurisdiction thereof and waive all objections to such choice of forum.

This clause can be dissected into three main sections: the scope, the location, and the consent to jurisdiction. Let’s dig into them.