Aggreko, LLC v. Bronxcare Health System, Formerly Known as the Bronx-Lebanon Hospital Center (No. 01-22-0052-CV; issued January 23, 2024) arose from a fatal accident on the premises of the hospital. In 2012 the hospital, a non-profit New York entity, rented a chiller from Aggreko, which was incorporated in Delaware and had its principal place of business in Louisiana. At the end of the rental term, Aggreko hired a local towing service to assist it in removing the chiller from the premises. As a hoisting chain lifted the chiller, the chain broke, killing an Aggregko employee. The employee’s family sued the hospital and the towing company in New York. The hospital filed third-party claims against Aggregko for indemnification. Aggregko settled the New York claims. Aggregko moved to dismiss the hospital’s claim based on a forum selection clause in its equipment rental contract, which stipulated litigation in Harris County. The New York trial court denied themotion on the basis that the contract was never executed and there was no evidence indicating that the hospital had accepted the terms and conditions, including the forum selection clause. The trial court then granted summary judgment in favor of the hospital on its common-law indemnity claim.
In 2020 Aggregko sued the hospital in Harris County, asserting contractual indemnification. The hospital filed a special appearance, which the trial court granted on the basis that the hospital had no contacts with Texas and did not agree to be bound by the forum-selection clause. The trial court granted the special appearance. Aggregko appealed.
The court of appeals affirmed. Aggregko asserted that its rental contract with the hospital contained an enforceable forum-selection clause stipulating litigation in Harris County. It further contained an indemnification clause requiring the hospital to hold Aggregko harmless for injuries to third parties arising from the handling of the equipment. The hospital countered that it never signed Aggregko’s terms and conditions but counteroffered with a purchase order that contained its own terms and conditions. The hospital further asserted that its acceptance of delivery, installation, and maintenance of the chiller did not constitute consent to be bound by Aggregko’s proposed contract. The problem in this case was that Aggregko’s proposed terms and conditions required the hospital to sign and return the acceptance page in order to accept the contract. The hospital didn’t do that. Instead, the hospital sent Aggregko a purchase order, which contained different terms and conditions. Once it received the purchase order, Aggregko stamped it with a reference to its terms and conditions, but the hospital never signed that either. Nevertheless, Aggregko delivered the chiller. Based on these facts, the court held that the hospital never agreed to Aggregko’s terms and conditions and, consequently, to be bound by the forum selection clause. The fact that the hospital employee who accepted delivery of the chiller and signed the bill of lading did not change things because Aggregko presented no evidence that the employee had authority to bind the hospital to the original proposal’s terms.
As to Aggregko’s assertion that the hospital was estopped from disclaiming the agreement with the forum selection clause because it accepted delivery of the chiller, the court held that the hospital evinced no evidence of intent to accept the terms. As the court put it, “[a] party claiming implied ratification must offer objective evidence of intent, such as a party’s conduct,” which must be determined by “the totality of the circumstances” (citations omitted). SCOTX precedent holds further that “implied ratification should be found only if the party’s actions ‘clearly evidenc[e] an intention to ratify” (citation omitted). Here Aggregko failed to make the requisite showing. Although Aggregko took certain actions on its own to bring the hospitals’ purchase order, with its own terms and conditions, within the ambit of its terms and conditions, the hospital always operated on the basis that Aggregko accepted its counteroffer. Moreover, although the parties agreed to subsequent change orders related to pricing, the hospital never signed them or acknowledged the conditions. Finally, direct benefits estoppel requires that a non-signatory party “seeking the benefits of a contract is estopped from simultaneously attempting to avoid the contract’s burdens” (citations omitted). In this case the questions was the terms and conditions to which the parties agreed, not one party’s avoidance of the burdens. Aggregko’s other arguments that acceptance of the chiller constituted acceptance of its terms, the court held, are simply attempts to impose a unilateral contract.
The trial court and court of appeals should be applauded by tossing this case, not only on contract principles, which are plenty enough, but on the basis that it had nothing to do with Texas at all. We think it likely that the presence of the forum selection clause in Aggregko’s contract was the specific reason that the hospital used its own purchase order instead.
