Commercial Division Blog

Posted: January 15, 2014 / Categories Commercial, Contracts, Confict of Laws

New York Choice of Law Provision Does Not Preclude Massachusetts Statutory Claim

On December 11, 2013, Justice Walker of the 8th Judicial District Commercial Division issued a decision in Melia v. Zenhire, Inc., 2013 NY Slip Op. 52254(U), addressing the intersection between a choice-of-law clause, a choice-of-forum clause, and a statutory cause of action.

In Melia, the plaintiff signed an employment agreement with defendants that provided for New York law to apply and for all actions to be venued in Erie County. However, during the entire term of the contract, the plaintiff lived and worked in Massachusetts.

The plaintiff sued the defendants in Massachusetts for violating the Massachusetts Wage Act. The Massachusetts court dismissed the plaintiff's lawsuit due to the forum selection clause. The plaintiff then brought an action in Erie County for both breach of contract and the Massachusetts Wage Act claim. Facing opposing motions for summary judgment, the court granted summary judgment to the plaintiff on the Massachusetts Wage Act claim, holding:

  • The Massachusetts Wage Act claim could proceed despite the existence of a viable New York breach-of-contract claim for the same conduct;
  • Contractual choice-of-law provisions do not apply to non-contract causes of action; and
  • Although there was no Court of Appeals case on point, if either New York’s tort or contracts conflicts-of-laws principles were applied, Massachusetts law would govern the wage claim, meaning that the Massachusetts Wage Act claim could proceed in Erie County.

From a procedural standpoint, Melia is interesting because it illustrates the varying scope of contract provisions that usually appear in tandem; the forum clause applied in non-contract causes of action, but the choice-of-law clause did not.  And for labor-and-employment practitioners, Melia shows that if the work was done outside New York, New York courts will accept foreign statutory causes of action even if a choice-of-law provision calls for application of New York law.