Bovino et al v. MacMillan

Filing 23

ORDER. Plaintiff's motion to remand (# 19 ) is GRANTED. This case is remanded to the District Court for the City and County of Denver. By Judge R. Brooke Jackson on 07/01/13. (alvsl)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge R. Brooke Jackson
Civil Action No 13-cv-01143-RBJ
DAVID A. BOVINO, ESQ., an individual, and
DAVID A. BOVINO P.C. d/b/a Law Offices of Bovino & Associates,
a Colorado corporation,
Plaintiffs,
v.
ANDREW MACMILLIAN, an individual,
Defendant.

ORDER

This case is before the Court on plaintiff’s motion to remand. [docket #19].
Facts
This case is the result of a payment dispute between the Law Offices of Bovino &
Associates (Bovino Law) and Andrew MacMillan. Plaintiff alleges that it entered into a retainer
agreement with Mr. MacMillan to represent him in a divorce from his wife and in issues
surrounding several trusts of which he is a beneficiary. Bovino Law alleges that it incurred
$441,747.41 in unpaid legal fees. Pursuant to the terms of the retainer agreement that included
an arbitration clause, Bovino Law filed a demand for arbitration with the Judicial Arbiter Group
in Denver on August 13, 2012.
During arbitration Bovino Law and Mr. MacMillan entered into a settlement agreement
where Mr. MacMillan agreed to pay Bovino Law $581,077.50. Upon payment in full, Bovino

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Law agreed to dismiss the arbitration with prejudice. The settlement agreement contained a
forum selection clause that provided:
This settlement Agreement, together with the Stipulation for Entry of Judgment executed
concurrently herewith . . . shall be governed by Colorado Law . . . and any action brought
by a party to enforce or interpret any provision of this Settlement Agreement shall be
brought exclusively in an appropriate state court in City and County of Denver, Colorado,
and the parties irrevocably consent to the jurisdiction of such courts for any dispute
hereunder or any obligation hereunder.
Settlement Agreement at 7-8. [#5].
Following the settlement agreement, Mr. MacMillan did not pay any of the $581,077.50.
The Bovino Law firm filed suit in the District Court for the City and County of Denver (Denver
District Court) in April 2013 seeking to recover that amount.
Mr. MacMillan, through his co-guardians, now argues that the settlement agreement is
not enforceable and has removed the action to this Court. Mr. MacMillan’s guardians argue that
Mr. MacMillan was not competent to enter into the settlement agreement with Bovino Law. Mr.
MacMillan was under a voluntary guardianship divesting him of his right to enter into contracts
and manage or dispose of his property beginning in July 2011. In early January 2013
involuntary guardianship proceedings were begun in Florida Probate Court by Mr. MacMillan’s
wife and mother. On January 15, 2013 Mr. MacMillan allegedly signed a document terminating
the voluntary guardianship.
At the arbitration proceedings, Mr. MacMillan’s mother, Patricia MacMillan, sought to
participate as his guardian. However, the arbitrator held that because Mr. MacMillan had
terminated the voluntary guardianship, Patricia MacMillan lacked standing to represent Mr.
MacMillan in the arbitration proceedings. On February 14, 2013 Mr. MacMillan and Bovino
Law entered into a settlement agreement to resolve all of the allegations raised during arbitration.
On March 28, 2013 the Florida court entered a court-ordered guardianship based upon Mr.

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MacMillan’s mental health. Patricia MacMillan and Christina MacMillan, Mr. MacMillan’s
wife, were appointed as co-guardians. They now argue that Bovino Law took advantage of the
ten week time period that Mr. MacMillan did not have a guardian to get Mr. MacMillan’s
signature on the settlement agreement. They argue that Mr. MacMillan was not competent to
enter into the contract and therefore it and its forum selection clause are unenforceable.
Analysis
Forum selection clauses are “prima facie valid and should be enforced unless
enforcement is shown by the resisting party to be unreasonable under the circumstances.” Milk
'N' More, Inc. v. Beavert, 963 F.2d 1342, 1346 (10th Cir. 1992). Defendant argues that the
forum selection clause in the settlement agreement should not be enforced because the entire
contract is not enforceable as Mr. MacMillan lacked the capacity to enter into the settlement
agreement.
Several courts have examined the issue of whether a forum selection clause is
enforceable when a party claims the entire contract is unenforceable. In the context of alleged
fraud, the courts have found that “[a] general claim of fraud or misrepresentation concerning an
entire contract does not affect the validity of a forum selection clause. Rather, the party
challenging the clause must demonstrate that the forum selection clause itself is the product of
fraud or coercion.” Barton v. Key Gas Corp., No. 05-CV-01856-REB-PAC, 2006 WL 2781592
(D. Colo. Sept. 26, 2006) (citing Scherk v. Alberto–Culver Co., 417 U.S. 506, 519 n. 14 (1974));
see also REO Sales, Inc. v. Prudential Ins. Co., 925 F.Supp. 1491, 1493 (D.Colo.1996); Edge
Telecom, Inc. v. Sterling Bank, 143 P.3d 1155, 1162 (Colo. App. 2006) (citing cases).
Although the defendants are not alleging fraud, but rather arguing that Mr. MacMillan
lacked capacity to contract, the principle is the same. Unless the defendants can show that the

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forum selection clause itself was entered into because Mr. MacMillan lacked the capacity to
contract, lack of capacity does not invalidate the forum selection clause. This result is necessary
from a practical standpoint. “If a forum clause were to be rejected whenever a plaintiff asserted
a generic claim of [lack of capacity to contract], as is the case here, then forum clauses would be
rendered essentially meaningless. That is, whenever a plaintiff had a breach of contract claim, it
could defeat an otherwise clear, detailed, and comprehensive forum selection clause by simply
alleging [capacity] as well.” REO Sales, Inc., 925 F.Supp. at 1495.
The defendant has not argued that the plaintiffs were able to procure Mr. MacMillan’s
consent to the forum selection clause in particular because of his alleged lack of capacity. Nor
have they argued that the forum selection clause is unfair or against public policy. Accordingly,
the forum selection clause is enforceable and remand to the Denver District Court is appropriate.
Plaintiffs ask that in addition to remanding, this Court should compel arbitration.
Remanding this case to the Denver District Court precludes this Court from also ordering
arbitration. Remanding this case is a determination that the Denver District Court is the
appropriate forum to litigate this dispute.
Order
Plaintiff’s motion to remand [#19] is GRANTED. This case is remanded to the District
Court for the City and County of Denver.
DATED this 1st day of July, 2013.
BY THE COURT:

___________________________________
R. Brooke Jackson
United States District Judge

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