Converted WP file 061554-1

Appeal by plaintiff from order entered 21 September 2006 by Judge C. Philip Ginn in Watauga County Superior Court. Heard in the Court of Appeals 6 June 2007.

Vetro & Lundy, P.C., by M. Shaun Lundy, for plaintiff- appellant.

di Santi Watson Capua & Wilson, by Anthony S. di Santi and Chelsea B. Garrett, for defendants-appellees.

    SMITH, Judge.

    Boone Podiatry, P.A. (plaintiff) appeals an order entered pursuant to N.C. Gen. Stat § 1-75.12(a) (2005) staying further proceedings in the case at bar. We reverse and remand.
    Plaintiff is a North Carolina professional association that
provides podiatric services in Western North Carolina. Defendants are citizens or entities existing under the laws of the State of Ohio that provide medical billing and collection services. This case arises out of a contract (hereinafter “Service Agreement”)entered into by the parties in December 2004. Plaintiff filed the instant civil action in Watauga County Superior Court on 12 July 2006 seeking actual, exemplary and punitive damages arising out of claims for breach of contract, fraud, and unfair and deceptive trade practices.
    On 1 August 2006, defendants filed a motion to dismiss or in the alternative, to stay these proceedings pursuant to G.S. § 1-75.12(a). Defendants' motion was based on the contention that Section 10 of the Service Agreement was a mandatory forum selection clause and thus the courts of North Carolina were an improper forum.
    Section 10 of the Service Agreement provides, in pertinent part:
        10. This Service Agreement shall be interpreted under the laws of Ohio and any disputes between the parties concerning the validity, interpretation or performance of any of the terms or provisions of this Service Agreement or of any rights or obligations of the parties hereto shall be resolved in Hamilton County, Ohio. . . .

Defendants' motion was heard in Watauga County Superior Court in September 2006 by the Honorable C. Philip Ginn. After the hearing, the trial court stated:
        [i]n the court's discretion it is of the opinion that Ohio law should be the compelling law for us to consider since that is what the contract has indicated. Further in the Court's discretion, the Court grants the motion of the Defendant for a stay in this matter. . . .

    In its order, the trial court concluded that:
                . . . the Plaintiff is required to bring the dispute asserted in the complaint concerning the validity, interpretation or performance of any of the terms or provisions of the Service Agreement, or of any rights or obligations of the Plaintiff and the Defendants, in Hamilton County, Ohio.

It is therefore apparent from the portions of the statement and order cited above, that the trial court considered the contested phrase in the Service Agreement to be a valid mandatory forum selection clause.
    Plaintiff timely filed notice of appeal with this Court.
    As an initial matter, we observe that by express statutory authority, there is an immediate right of appeal when a stay has been issued in accordance with N.C. Gen. Stat. § 1-75.12(c) (2005)(“Whenever a motion for a stay made pursuant to subsection (a) above is granted, any nonmoving party shall have the right of immediate appeal.”).
    Plaintiff's first contention on appeal is to the effect that the trial court erred by granting defendants' motion to stay the subject cause of action.   (See footnote 1) We agree.    In Lawyers Mut. Liab. Ins. Co. v. Nexsen Pruet Jacobs & Pollard, 112 N.C. App. 353, 356-57, 435 S.E.2d 571, 573-74 (1993) this Court said:
        In determining whether to grant a stay under G.S. § 1-75.12, the trial court may consider the following factors: (1) the nature of the case, (2) the convenience of the witnesses, (3) the availability of compulsory process to produce witnesses, (4) the relative ease of access to sources of proof, (5) the applicable law, (6) the burden of litigating matters not of local concern, (7) the desirability of litigating matters of local concern in local courts, (8) convenience and access to another forum, (9) choice of forum by plaintiff, and (10) all other practical considerations.

        . . . .

        A court will not have abused its discretion in failing to consider each enumerated factor. . . . A court will have abused its discretion, however, if it abandons any consideration of these factors which this Court has deemed relevant in determining whether a stay is warranted.

After a careful review of the record on appeal, we are constrained to reverse the entry of the stay order as it fails to contain any facts necessary to support the same. The record on appeal is bereft of both factual findings and any reasoned consideration of any of the enumerated factors articulated by this Court in Lawyers Mutual. The trial court's failure to make appropriate findings and conclusions prevents us from determining the basis, if any, upon which the trial court granted the motion to stay the proceedings below. See Management, Inc. v. Development Co., 46 N.C. App. 707, 710, 266 S.E.2d 368, 37 (1980) (the central inquiry on appeal in adjudicating a stay order is “whether the court's findings of factand conclusions of law support the order staying the proceedings”). As the trial court's order failed to comport with the minimum requirements forth in Lawyers Mutual, the trial court's order cannot be said to be manifestly supported by reason.
    Plaintiff next contends that the trial court erred by concluding that Section 10 of the Service Agreement, under Ohio law, is a mandatory forum selection clause requiring this dispute be brought in Hamilton County, Ohio. We disagree.
    We initially observe that an Ohio case, EI UK Holding, Inc. v. Cinergy UK, Inc., 2005-Ohio-1271 (Ohio App. 9 Dist. Mar 23, 2005) (NO. 22326) addresses the issue now before us. But this opinion is unpublished and hence fails to qualify as authority outside of the district in which it was filed. see State v. George, 50 Ohio App. 2d 297, 312, 362 N.E.2d 1223, 1232-33 (1975) (unreported cases filed in one of the district courts of appeal in Ohio may only be cited as binding authority in that particular district.) However, after a thorough review of Ohio jurisprudence, we conclude that the principles articulated in EI UK Holding, Inc., best capsulize Ohio law regarding interpretation of forum selection clauses and we find this unpublished opinion both instructive and persuasive.
    Consequently, in Ohio :

        Mandatory forum selection clauses contain clear language showing that jurisdiction is appropriate only in the designated forum. In contrast, permissive forum selection clauses authorize jurisdiction in a designated forum, but do not prohibit litigation elsewhere. . . .

        Where a forum selection clause states mandatory or obligatory language, it is amandatory clause that limits litigation to the designated venue. However, when only jurisdiction is specified the clause will generally not be enforced without some further language indicating the parties' intent to make jurisdiction exclusive.

EI UK Holding, Inc., 2005-Ohio-1271 at ¶¶ 20 and 21.
    Additionally, it is a well-settled principle in Ohio that use of the word “shall” whether in a statute or contract constitutes a mandatory legal obligation. See Woodmansee v. Cockerill, 115 Ohio App. 409, 415, 185 N.E.2d 439, 443 (1961)(“Shall, as used in statutes, contracts, or the like, this word is generally imperative or mandatory.”).
    In the case sub judice, Section 10 of the Service Agreement between the parties provides, in pertinent part, that:
        10. . . . any disputes . . . concerning the validity, interpretation or performance of any of the terms or provisions of this Service Agreement or of any rights or obligations of the parties hereto shall be resolved in Hamilton County, Ohio. (emphasis added).

The plain language of this clause, and specifically the word “shall”, as interpreted under Ohio law, indicates that the subject clause is a mandatory forum selection clause, which “contain[s] clear language showing that jurisdiction is appropriate only in the designated forum.” EI UK Holding, Inc., 2005-Ohio-1271 at ¶¶ 20. Consequently, as disputes under the Service Agreement “shall be resolved in Hamilton County, Ohio”, the superior court of Watauga County, North Carolina was not the proper forum for adjudication of this action. See L.C. Williams Oil Co., 130 N.C. App. at 292, 502 S.E.2d at 418.     In sum, we reverse the trial court's order staying the proceedings. We also conclude that Section 10 of the Service Agreement is a mandatory forum selection clause under Ohio law. Therefore, the courts of Hamilton, County Ohio and not North Carolina provide the proper forum for adjudication of this action. Accordingly, we remand this case to the trial court for proceedings not inconsistent with this opinion.
    Reversed and remanded.
    Chief Judge MARTIN and Judge STEPHENS concur.
    Report per Rule 30(e).

Footnote: 1