NEWS Notes green

Significance of Choice of Law and Forum Selection Clauses in Marital Settlement Agreements

September 12, 2019

MARGARITA ROMANOVA reports on a recent unpublished decision from the Superior Court of New Jersey, Appellate Division.

Following a two-year marriage, the parties were divorced by way of a Dual Judgment of Divorce that incorporated the parties’ Marital Settlement Agreement (MSA). The parties agreed to share joint legal custody of their child, and the Wife was designated as the Parent of Primary Residence and the Husband as the Parent of Alternate Residence. The parties also agreed that New Jersey law would govern the custody and parenting disputes relative to their minor child.

While the divorce proceedings were pending, the Wife moved to Italy, and the parties agreed on a parenting time schedule whereby the child alternated time with each parent between New Jersey and Italy. After the divorce, the Husband moved from Hudson County to Monmouth County.

Certain post-judgment disputes relative to custody and parenting arose, and the Husband sought a change of venue to Monmouth County on the basis that it was a more convenient forum now that he resided in Monmouth County. In her cross-motion, the Wife requested that the New Jersey Court decline jurisdiction under the Uniform Child Custody Jurisdiction and Enforcement Act (UCCJEA) and that the venue be transferred to a court in Italy. The Court denied the Wife’s request and granted the Husband’s application finding, inter alia, that the child had a significant continuing connection to New Jersey and that New Jersey law governed the parties’ agreement. The Wife appealed.

On appeal, the Wife contended that the provision in the MSA relative to the application of New Jersey law to custody and parenting disputes was a choice of law provision, not a choice of forum provision. In other words, she argued that the parties only agreed that New Jersey substantive law would govern any and all custody and/or parenting disputes that may arise post-judgment and that the parties did not agree as to any specific jurisdiction in which such disputes shall be adjudicated. The Appellate Division rejected the Wife’s arguments, agreed with the trial court’s analysis of the relevant statutory factors and affirmed its ruling. 

The decision is a reminder that negotiating a choice of law provision is just as crucial as negotiating a forum selection clause as part of the comprehensive agreement, especially when the parties reside (or anticipate residing) in different jurisdictions post-divorce. Doing so would eliminate uncertainty, which is highly undesirable in the post-divorce arena, and ensure a convenient, mutually agreed-upon locus for the adjudication of post-judgment disputes. Provided that they are bona fide and not contrary to public policy, such provisions will generally be enforced by the Courts.

Please contact Margarita Romanova if you have any questions or need assistance in connection with this subject.