§ 410.40.Action Against Foreign Corporation Or Nonresident Person In California Court

Section 410.40 targets a specific kind of commercial contract: one where the parties picked California law to govern their deal and the foreign corporation or nonresident agreed to submit to California courts. Under this section, any person may sue in a California court on a contract, agreement, or undertaking that made this kind of choice of California law, so long as the transaction involves at least one million dollars in the aggregate and the contract contains a provision under which the foreign party agrees to California jurisdiction.

The section is deliberately retroactive. It applies to contracts entered into before, on, or after its effective date of January 1, 1993, and it validates contracts choosing California law that predate the statute as if the statute had already been in force when they were signed. Actions already pending in a California court before the effective date may likewise proceed as though the section had been in effect when they were commenced.

This section works alongside § 410.10’s broad grant of jurisdiction. Where § 410.10 leaves the jurisdictional question to constitutional due process generally, § 410.40 gives sophisticated parties to a high-value contract a way to lock in California as the forum by agreement, reducing later argument over whether the defendant’s contacts with the state are enough on their own.