SRC-JFA S.B. 1855 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 1855
By: Wentworth
Economic Development
4-29-97
As Filed


DIGEST 

Currently, under some Texas cases, the state's venue statutes prohibit a
forum and venue selection clause in a contract agreement where the
statutes permit or require an action to be brought in a certain court.
Some Texas courts have read the venue statutes to authorize forum and
venue selection clauses in contracts. Barnette v. United Research Company,
Inc., 823 S.W.2d 368 (Tex.App.--Dallas 1991, writ den'd).  As a result,
there is some confusion as to whether forum and venue selection clauses
are enforceable under Texas venue law.  This bill would amend the Civil
Practice and Remedies Code to provide that in commercial transactions with
a value of $1 million or more, contracting parties may agree to make venue
proper in a particular location for lawsuits arising out of the
transaction or may agree to make venue improper in a particular county of
this state, notwithstanding other permissive or mandatory provisions of
the Civil Practice and Remedies Code.   

PURPOSE

As proposed, S.B. 1855 provides that in a commercial transaction with a
value of $1 million or more, contracting parties are authorized to agree
to make venue proper in a particular location for lawsuits arising out of
the transaction or may agree to make venue improper in a particular county
of this state.   

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Chapter 15B, Civil Practice and Remedies Code, by adding
Section 15.019, as follows:   

Sec. 15.019.  MAJOR TRANSACTIONS:  SPECIFICATIONS OF VENUE BY AGREEMENT.
Defines "major transaction."  Requires an action arising from a major
transaction to be brought in a county if the party against whom the action
is brought has agreed in writing that a suit arising from the transaction
may be brought in that county. Prohibits an action arising from a major
transaction, notwithstanding any other provision of this title, from being
brought in a county under certain conditions.  Provides that this section
does not apply to an action under certain conditions.  Provides that this
section does not affect venue and jurisdiction in an action arising from a
transaction that is not a major transaction.   

SECTION 2. Makes application of this Act prospective.

SECTION 3. Emergency clause.
  Effective date: upon passage.