FORUM SELECTION CLAUSE | PERSONAL JURISDICTION | SPECIAL APPEARANCE

Halabu v. Petroleum Wholesale, LP (Tex.App.- Houston [1st Dist.] May 22, 2008)
(Bland) (special appearance, forum selection clause enforced)
AFFIRM TC JUDGMENT: Opinion by
Justice Jane Bland
Before Chief Justice Radack, Justices Jennings and Bland
01-07-00614-CV Shamil Halabu v. Petroleum Wholesale, L.P.
Appeal from 151st District Court of Harris County
Trial Court
Judge: Hon. Caroline E. Baker
Attorneys: Sean S. Modjarrad  Roger G. Jain  Patty A. Morris | Stuart W. Lapp  Daniel Prescott
McManus

MEMORANDUM OPINION

Petroleum Wholesale (“Petroleum”) sued appellant, Shamil Halabu, for breach of contract,
alleging that he had personally guaranteed a contract between Petroleum and USA Travel
Center.  Halabu filed a special appearance in the trial court, asserting that it lacked personal
jurisdiction over him and denying that he had signed the guarantee.  In his sole issue on
appeal, Halabu contends that the trial court erred in denying his special appearance.  We
affirm.

Background

In August 2005, Petroleum and USA Travel entered into a “Fuel Marketing Location
Agreement” (“FMLA”) whereby Petroleum agreed to sell motor fuels to USA Travel delivered
to its place of business in Amarillo, Texas.  The FMLA contained a provision that stated that
the agreement “shall be construed under and in accordance with the laws of the State of
Texas, and all obligations of the parties created hereunder are performable in Harris County,
Texas.”[1]  The bottom of each page of the FMLA is initialed “SH.”  Page eleven of the
agreement, entitled “GUARANTEE” contains a personal guarantee of payment and
performance of the FMLA.  It is signed, with the signature block reading SHAMIL HALABU.  In
2006, Petroleum sued USA Travel for breach of contract, alleging that USA Travel “unilaterally
ceased doing business with [Petroleum] and has failed and refused to pay the amounts
owing,” and that Halabu guaranteed payment by signing the gurarantee.  

Halabu filed a special appearance, contending that he does not do business in the State of
Texas.  He further asserts that he did not sign the FMLA or the guarantee, nor did he
authorize anyone to sign the guarantee on his behalf.  Halabu attached the affidavit of Sabah
Senawi as evidence that he did not agree to the guarantee.  Senawi’s affidavit stated that
USA Travel and Petroleum had agreed that no personal guarantee would be included in the
contract.  Senawi further stated that he had met with Ken Dixon, an employee of Petroleum
and signed the documents in his capacity as the corporate representative for USA Travel.  He
contends that he did not read the documents and trusted that Dixon would present him with
documents representing their true agreement.  Senawi further asserts that “Shamil Halabu
was not present at this meeting and did not sign any of the documents entered into between
the parties on August 17, 2005, nor did he direct me to sign on his behalf.”

In response to Halabu’s special appearance, Petroleum filed the supporting affidavit of Ken
Dixon.  Dixon stated that just prior to the signing of the FMLA and the personal guarantee,
Senawi called Halabu on the telephone to discuss the FMLA and the personal guarantee.  
According to Dixon, he had a telephone conversation the following day with Halabu, who told
Dixon that Senawi had authority to sign the documents on his behalf and that he had reviewed
the FMLA before it was signed.  At the special appearance hearing, Halabu objected to Dixon’
s affidavit because it was not notarized and because it was not filed at least seven days
before the hearing.  See Tex. R. Civ. P. 120a(3).  The trial court did not rule on the objection
before denying Halabu’s special appearance.

Analysis

In his sole issue, Halabu contends that the trial court erred in denying his special
appearance.  Halabu also asserts that the trial court should not have considered Petroleum’s
late-filed affidavit by Ken Dixon.

Special appearances are governed by Rule 120a, which provides that “a special appearance
may be made by any party . . . for the purpose of objecting to the jurisdiction of the court over
the person or property of the defendant on the ground that such party or property is not
amenable to process by the courts of this State.”  Id. 120a.  

On appeal we review de novo the trial court’s determination to grant or deny a special
appearance.  Am. Type Culture Collection, Inc. v. Coleman, 83 S.W.3d 801, 806 (Tex.
2002).   The plaintiff bears the initial burden of pleading sufficient allegations to bring a
nonresident defendant within the provisions of the Texas long-arm statute.  BMC Software
Belg., N.V. v. Marchand, 83 S.W.3d 789, 793 (Tex. 2002).  A nonresident defendant
challenging the court’s exercise of personal jurisdiction through a special appearance carries
the burden of negating all grounds for personal jurisdiction alleged by the plaintiff.  Id.; Glattly
v. CMS Viron Corp., 177 S.W.3d 438, 446 (Tex. App.—Houston [1st Dist.] 2005, no pet.).  We
review all evidence in the record to determine if the nonresident defendant negated all
possible grounds.  N803RA, Inc. v. Hammer, 11 S.W.3d 363, 366 (Tex. App.—Houston [1st
Dist.] 2000, no pet.) (citing Kawasaki Steel Corp. v. Middleton, 699 S.W.2d 199, 203 (Tex.
1985)).  

Trial courts must frequently resolve questions of fact before deciding the jurisdictional
question.  BMC Software, 83 S.W.3d at 794. When a trial court issues findings of fact and
conclusions of law, we may review the findings of fact on legal and factual sufficiency grounds
and review the conclusions of law de novo as a legal question.  Silbaugh v. Ramirez, 126 S.W.
3d 88, 94 (Tex. App.—Houston [1st Dist.] 2002, no pet.) (citing BMC Software, 83 S.W.3d at
794).  If the trial court does not issue findings of fact, “all facts necessary to support the
judgment and supported by the evidence are implied.”  BMC Software, 83 S.W.3d at 795.  In
other words, if the trial court does not issue findings of fact, a reviewing court should presume
that the trial court resolved all factual disputes in favor of its judgment.  Tri-State Bldg.
Specialties, Inc. v. NCI Bldg. Sys., L.P., 184 S.W.3d 242, 246 (Tex. App.—Houston [1st Dist.]
2005, no pet.) (citing Coleman, 83 S.W.3d at 806; BMC Software, 83 S.W.3d at 795).  We
may set aside a finding of fact only if the evidence would not enable a reasonable and fair
minded finder of fact to make the finding under review.  City of Keller v. Wilson, 168 S.W.3d
802, 827 (Tex. 2005).  

Two requirements must be met before a Texas court can exercise personal jurisdiction over a
nonresident defendant.  First, the Texas long-arm statute must authorize the exercise of
jurisdiction, and second, the exercise of jurisdiction must be consistent with the guarantees of
due process.  Coleman, 83 S.W.3d at 806; Tri-State Bldg. Specialties, Inc., 184 S.W.3d at 248.

With respect to personal jurisdiction, federal due process requires two things.  First, the
nonresident defendant must have purposefully established such minimum contacts with the
forum state that the defendant could reasonably anticipate being sued there.  Glattly, 177 S.
W.3d at 446 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475–76, 105 S. Ct. 2174,
2183–84 (1985)).  Second, if the nonresident defendant has purposefully established
minimum contacts with the forum, the exercise of personal jurisdiction must also comport with
traditional notions of fair play and substantial justice.  Id. at 447 (citing Burger King, 471 U.S.
at 475–76, 105 S. Ct. at 2183–84).  As to fairness, the defendant bears the burden of
presenting a “compelling case” that exercising jurisdiction over him would not be fair or just.  
See id. at 450.  Only in rare cases, however, will a Texas court’s exercise of personal
jurisdiction not comport with fair play and substantial justice when the nonresident defendant
has purposefully established minimum contacts with the forum state.  Guardian Royal Exch.
Assur., Ltd. v. English Clays, P.L.C., 815 S.W.2d 223, 231 (Tex. 1991).  

Personal jurisdiction is a waivable requirement. Burger King, 471 U.S. at 473 n. 14, 105 S. Ct.
at 2182 n. 14; Ins. Corp. of Ir. v. Compagnie des Bauxites de Guinée, 456 U.S. 694, 703, 102
S. Ct. 2099, 2105 (1982). A forum-selection clause is one of several ways in which a litigant
may expressly or impliedly consent to personal jurisdiction.  Abacan Technical Servs. Ltd. v.
Global Marine Intern. Servs. Corp., 994 S.W.2d 839, 843 (Tex. App.—Houston [1st Dist.]
1999, no pet.) (citing Burger King, 471 U.S. at 473 n. 14, 105 S. Ct. at 2182 n. 14).  
Enforcement of a forum-selection clause is mandatory absent a showing that “enforcement
would be unreasonable and unjust, or that the clause was invalid due to fraud or
overreaching.”  In re Automated Collection Techs., Inc., 156 S.W.3d 557, 559 (Tex. 2004)
(quoting In re AIU Ins. Co., 148 S.W.3d 109, 112 (Tex. 2004)).

Petroleum Wholesale premised jurisdiction on Halabu’s agreement to the forum-selection
clause in the “Fuel Marketing Location Agreement,” which Halabu allegedly personally
guaranteed.  Halabu contests enforcement of the clause designation performance in Harris
County on the grounds that the personal guarantee was not part of the agreement, that he
did not sign the personal guarantee, and that he did not authorize Senawi to sign it as his
agent.  Halabu asserts that the evidence is insufficient to support a finding that he guaranteed
the agreement and is therefore bound by the forum-selection clause.  Specifically, Halabu
states that “Petroleum Wholesale had no evidence to challenge that produced by Halabu,”
and thus, “the proof supports only one conclusion; the Trial Court did not have personal
jurisdiction over Halabu.”  

Contrary to Halabu’s assertions, Petroleum Wholesale presented proof that Halabu agreed to
be bound by the forum-selection clause: it provided the original contract and the guarantee
with Halabu’s signature.  Even if we do not consider the late-filed affidavit, “the clause is prima
facie valid and enforceable unless the opponent establishes a compelling reason not to
enforce it.”  Abacan Technical, 994 S.W.2d at 843.  Although Halabu presented contradictory
evidence to establish that Halabu did not sign the affidavit and did not authorize Senawi to
sign the affidavit as his agent, it is the sole province of the fact-finder to resolve conflicts in
the evidence.  See Benoit v. Wilson, 150 Tex. 273, 281–82, 239 S.W.2d 792, 796–97 (1951);
Marshall Field Stores, Inc. v. Gardiner, 859 S.W.2d 391, 401 (Tex. App.—Houston [1st Dist.]
1993, writ dism’d w.o.j.).  The trial court had before it the signed agreement that included the
forum-selection clause, as well as the signed personal guarantee.  The trial court reasonably
could have disregarded Senawi’s affidavit that stated that he was not authorized to sign for
Halabu and concluded that Halabu intended to agree to the forum-selection clause for
purposes of personal jurisdiction.  Because it may be reasonably inferred from the evidence
that Halabu agreed to be bound by the forum-selection clause, sufficient evidence supports
the trial court’s findings.  See Lozano v. Lozano, 52 S.W.3d 141, 149 (Tex. 2001) (if it may
reasonably be inferred from the circumstantial evidence that one or more of the appellants
assisted in the offense, then there is some evidence to support the jury’s verdict).

Conclusion

We affirm the trial court’s order denying Halabu’s special appearance.


                                                    Jane Bland

                                                    Justice

Panel consists of Chief Justice Radack and Justices Jennings and Bland.

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[1]               Halabu’s counsel attached an FMLA agreement for Arizona as an appendix to his brief.  This
agreement, however, is not part of the record.  The agreement in this case, found in the clerk’s record page
42, contains the above-quoted language in paragraph 29, entitled “TEXAS LAW TO APPLY.”