Forum-Selection Clause Zapata Off-Shore Company (Zapata) was a Houston, Texasâ€“based American corporation that engaged in drilling oil wells throughout the world. Unterweser Reederei, GMBH (Unterweser), was a German corporation that provided ocean shipping and towing services. Zapata requested bids from companies to tow its self-elevating drilling rig Chaparral from Louisiana to a point off Ravenna, Italy, in the Adriatic Sea, where Zapata had agreed to drill certain wells. Unterweser submitted the lowest bid and was requested to submit a proposed contract to Zapata, which it did. The contract submitted by Unterweser contained the following provision: â€œAny dispute arising must be treated before the London Court of Justice.â€ Zapata executed the contract without deleting or modifying this provision.
Unterweserâ€™s deep sea tug Bremen departed Venice, Louisiana, with the Chaparral in tow, bound for Italy. While the flotilla was in international waters in the middle of the Gulf of Mexico, a severe storm arose. The sharp roll of the Chaparral in Gulf waters caused portions of it to break off and fall into the sea, seriously damaging the Chaparral. Zapata instructed the Bremen to tow the Chaparral to Tampa, Florida, the nearest port of refuge, which it did. Zapata filed suit against Unterweser and the Bremen in U.S. District Court in Florida, alleging negligent towing and breach of contract. The defendants asserted that suit could be brought only in the London Court of Justice. Who is correct? M/S Bremen and Unterweser Reederei, GMBH v. Zapata Off-Shore Company, 407 U.S. 1, 92 S.Ct. 1907, 32 L.Ed.2d 513, Web 1972 U.S. Lexis 114 (Supreme Court of the United States)