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Note: Altchem Environmental Service, Inc. (Contractor) and United Demolition & Reclamation Statewide Restoration Co. (Subcontractor/Applicant) entered into a US$369,000 agreement for services (Agreement) via purchase order on a demolition project at Brookside Terrace in New Haven, Connecticut. The Agreement allowed modification of the terms with Contractor's written approval and granted Contractor the right to decide jurisdiction in the event of litigation.

As required by the Agreement, Subcontractor/ Applicant provided a standby letter of credit issued by Washington Mutual Bank. When Issuer failed in 2008, the standby was worthless.

Contractor alleged that due to Issuer's failure, Contractor and Subcontractor/Applicant reached a "new understanding" (Modification) under which Contractor supplied Subcontractor/Applicant with the necessary equipment and advance wages in exchange for a 2% charge.

When Subcontractor/Applicant subsequently sued Contractor in Connecticut, Contractor moved to dismiss the complaint, arguing that the Agreement permitted it to select the forum. Superior Court of Connecticut, Judicial District of New Haven, Matthew Frechette, J., granted Contractor's motion and dismissed the action.

The Judge ruled that both parties were subject to the terms of the Agreement that had been unaltered by the Modification. Subcontractor/Applicant thus had no authority to initiate proceedings in Connecticut without Contractor's approval of jurisdiction.

[JEB/kmw]

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