Governing Law and Jurisdiction Clause
What it is
A governing law clause specifies which state's law applies to the contract. A forum selection or jurisdiction clause specifies where disputes must be litigated or arbitrated. These two clauses often appear together in the boilerplate section of a contract and are frequently overlooked — but they determine where you have to go and whose rules apply if anything goes wrong.
Why it matters to you
Litigating in another state means flying there, hiring local counsel, and losing home-court familiarity. For a small claim, the cost of litigating in a remote jurisdiction may exceed the value of the claim — which is sometimes exactly the intent. A governing law choice also affects which protections apply to you: certain state laws offer contractor protections that do not exist elsewhere.
The aggressive version
Forum selection language typically appears at the end of the agreement where readers have stopped paying attention.
This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to its conflict of law provisions. Any legal action, suit, or proceeding arising from or relating to this Agreement shall be brought exclusively in the state or federal courts located in New Castle County, Delaware, and each party irrevocably consents to the personal jurisdiction of such courts.
What each part does to you
“State of Delaware”
Delaware has no special connection to either party. This is chosen for procedural reasons that favor the drafting company.
“without regard to its conflict of law provisions”
Prevents the court from applying your home state's law even if you are based there and the work was done there.
“irrevocably consents to the personal jurisdiction”
You are agreeing in advance that Delaware courts have authority over you. You cannot later contest jurisdiction.
The market standard version
A neutral governing law clause reflects the actual location of the work or provides a reasonable compromise.
This Agreement shall be governed by the laws of the state in which the majority of Services are performed. Disputes shall be heard in courts of competent jurisdiction in that state. Alternatively, both parties may agree in writing to resolve disputes in a neutral venue, such as the geographic midpoint between both parties' principal offices.
Your counter-language
This version anchors jurisdiction to your work location and preserves flexibility for dispute resolution.
This Agreement shall be governed by the laws of [your state]. Any dispute that cannot be resolved by negotiation shall be heard in courts of competent jurisdiction in [your state / mutual city]. If the parties cannot agree on venue, disputes shall be heard in the jurisdiction of the responding party. Each party retains the right to seek emergency injunctive relief in any court of competent jurisdiction.
What to ask for
“Can we use the governing law of the state where I'm located, or where the majority of the work is being done?”
“If you need a specific state for legal reasons, can we at least make the forum where I'm located rather than requiring me to travel for any dispute?”
“Can we add a provision that each party's emergency injunctive relief claims can be heard in their local courts?”
Related clauses and guides
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Arbitration and Dispute Resolution Clause
An arbitration clause replaces litigation with a private dispute resolution process.
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Indemnification Clause
An indemnification clause is a promise to cover the other party's losses if certain events occur.
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ClauseCheck is not a law firm and does not provide legal advice. The clause examples and counter-language on this page are illustrative only and are not a substitute for advice from a qualified attorney. Contract terms vary by context; consult a lawyer before making decisions on any specific agreement.
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