In Kostelac v. Allianz Global Corporate & Specialty AG, the U.S. Court of Appeals for the 11th Circuit examines one of the first hurdles that often arises in personal injury cases: deciding where to sue.
Mr. Kostelac was seriously injured when the Remos GX aircraft he was flying crashed in Florida. He later sued the plane’s German manufacturer, Remos Aircraft GmbH, and its U.S. distributor, Remos Aircraft, Inc., for negligence in federal court in Miami. Both companies were insured by Allianz Global under the same policy, which was issued in Germany and is written in German. Allianz denied coverage under this policy for Kostelac’s accident, however.
The companies later entered into a consent judgment with Kostelac in which they admitted fault for the accident and acknowledged that Kostelac sustained damages of roughly $2.95 million in the crash. In exchange for his agreement to not enforce the judgment, the companies assigned all of their rights and interests in the insurance policy to Kostelac. He then sued Allianz, alleging breach of contract for its denial of coverage related to the plane crash.
A district court dismissed the case under the doctrine of forum non conveniens, which allows a court to decline to hear a case where another forum is deemed more appropriate.
The Eleventh Circuit affirmed the dismissal on appeal, but not on forum non conveniens grounds. The appeals court explained that a plaintiff is entitled to a “strong presumption” in favor of its choice of forum. “[T]he plaintiff’s choice is entitled to greater deference when the plaintiff has chosen his home forum,” the court further explained. As a U.S. citizen, the court said all U.S. district courts were considered Kostelac’s home forum. Although Kostelac was a Virginia resident at the time, the court said his choice of the Florida forum was still entitled to deference as a result.
Nevertheless, the court said the lawsuit should be dismissed based on a forum selection clause in the insurance policy. The clause provided that all suits under the policy be brought in Germany, provided that the policy holders – in this case the companies – has their principal place of business in Germany. As a result, the appeals court said the clause applied to Kostelac’s claims.
The court explained that forum selection clauses such as the one included in the policy are generally considered enforceable unless the person seeking to avoid enforcement can show that the clause is unreasonable. Because Kostelac had been assigned the Remos companies’ rights under the policy, the court looked to whether the forum selection clause was unreasonable as enforced against the companies. Under this lens, the court said there was no evidence of unreasonableness: the companies had an opportunity to negotiate the policy terms and there was no reason to believe that they didn’t know of any hardships that might be caused by having to litigate any claims in Germany.
The court affirmed the trial court’s decision dismissing the case.
Forum selection is just one of the issues that can come up in aircraft injury cases and which must be considered before suing an insurance company or other responsible party. If you or a loved one has been involved in an aviation accident, please take advantage of a free consultation offered by the South Florida airplane accident lawyers at Anidjar & Levine. We pride ourselves in responsive, diligent and cost-effective representation. You can contact the firm’s Fort Lauderdale offices at (800) 747-3733, or submit an on-line “Contact Us” form.
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