Choice of Law

Question 1

What state’s law governs in a choice of law case?

Answer 1

The law selected by the forum court according to its choice of law approach.

Question 2

What choice of law approach is applied in a federal diversity case?

Answer 2

The approach of the state in which that federal court sits.

Question 3

What choice of law approach is applied in a federal diversity case that was originally filed in a proper venue (then transferred)?

Answer 3

The approach of the original/transferor court.

Question 4

What choice of law approach is applied in a federal diversity case that was originally filed in an improper venue (then transferred)?

Answer 4

The law of the receiving/transferee court.

Question 5

What are the three choice of law approaches?

Answer 5

1. Traditional vested rights
2. Most significant relationship (2nd RS)
3. Interest analysis

Question 6

Paragraph 1 of any choice of law question

Answer 6

“The issue presented is which state’s law will govern the outcome of this litigation. The governing law will be selected by the forum court using the ____________.”

Question 7

Paragraph 2 for vested rights answer

Answer 7

“Under this approach, the court will apply the law of that state mandated by the applicable vesting rule. That rule is selected according to the relevant substantive area of law.”

Question 8

Paragraph 3 for vested rights answer

Answer 8

1. State the substantive area of law.
2. State the applicable vesting rule.
3. Apply the rule to determine the governing law.
4. Apply the governing law to determine the result.

Question 9

Paragraph 2 for interest analysis answer

Answer 9

“Under this approach, the court will consider which states have a legitimate interest in the outcome of the litigation. The forum court will apply its own law as long as it has a legitimate interest. If the forum state has no legitimate interest, it will apply the law of another interested state.”

Question 10

Paragraph 3 for interest analysis answer

Answer 10

1. Discuss which states have legitimate interests.
2. Characterize the type of conflict (true or false).
3. Choose the governing law based on the type of conflict (true: forum state; false: interested state).
4. Apply the governing law to determine the result.

Question 11

In an interest analysis choice of law approach, how does the type of conflict impact whose law applies?

Answer 11

If only one state has a legitimate interest, it’s a false conflict and the law of the interested state applies.

If 2+ states have a legitimate interest, it’s a true conflict and the law of the forum state applies.

Question 12

Paragraph 2 for most significant relationship answer

Answer 12

“Under this approach, the court will apply the law of the state which is most significantly related to the outcome of the litigation. To determine this, the court will consider connecting facts and policy principles.”

Question 13

Paragraph 3 for most significant relationship answer

Answer 13

1. Discuss connecting facts.
2. Discuss policy principles.
3. Choose governing law based on most significant relationship.
4. Apply the governing law to determine the result.

Question 14

What are some policy principles to consider under the most significant relationship approach?

Answer 14

• Needs of interstate system
• Relevant policies of forum
• Policies and interests of other jxs
• Expectations of parties
• Basic policies underlying substantive law
• Predictability and uniformity of result
• Ease of determination of foreign law

Question 15

Vested rights approach in torts

Answer 15

The governing law is the law where the injury occurred.

Question 16

Most significant relationship approach in torts

Answer 16

Factual connections

Consider the place:

• of injury
• of the conduct causing injury
• where the parties are at home, and
• where the relationship, if any, is centered

Policy principles

Consider the relevant policies of the forum state and of other connected states.

Question 17

What is the usual outcome in a torts case under all three approaches?

Answer 17

The governing law will almost always be the law of the place of injury.

Except:

1. The rule at issue is a loss distribution rule, AND
2. The parties share a common domicile.

Question 18

What are some examples of loss distribution rules?

Answer 18

• damage caps
• vicarious liability rules
• immunity rules

Question 19

Vested rights approach in contracts

Answer 19

If the case is about formation, apply the law of the place of contracting.
– includes issues with capacity, contractual formalities, and consideration

If the case is about performance, apply the law of the place of performance.
– includes issues with time/place/manner of performance and excuses for nonperformance

Question 20

Most significant relationship approach in contracts

Answer 20

Factual connections

Consider the place:

• of contracting
• of negotiation
• of performance, and
• where the parties are at home.

Policy principles

Consider the relevant policies of the forum state and of other connected states, as well as the reasonable expectations of the parties.

Question 21

What is the effect of a choice of law provision in a contract?

Answer 21

It will be enforced if it is valid and express.

Question 22

Why would a court find a contractual choice of law provision invalid?

Answer 22

1. The contract has no reasonable relationship to the law selected, or
2. The provision was included without true mutual consent.

Question 23

What governing law is applied in cases involving real property?

Answer 23

The law of the situs.

Question 24

What governing law applies in cases involving personal property?

Answer 24

If the case involves an inter vivos transaction, apply the law of the situs at the time of transaction.

If the case involves a matter relating to inheritance, apply the law of the decedent’s domicile at the date of death.

Question 25

What is the rule about recognizing valid marriages?

Answer 25

If a marriage is valid where performed, it will be recognized as valid everywhere.

BUT if domiciliaries of one state temporarily relocate to another state to enter a marriage that violates a prohibitory rule their home state, the state of domicile will not recognize the marriage.

Question 26

What court applies divorce laws?

Answer 26

The forum court will apply its own divorce laws.

Question 27

What are the rules regarding legitimacy?

Answer 27

1. Legitimacy of a child is governed by the law of the mother’s domicile at the time of the child’s birth.
2. The validity of subsequent acts of legitimation concerning paternity are governed by the law of the father’s domicile.

Question 28

What is the public policy defense to choice of law?

Answer 28

A forum court will not apply a law that is against its own fundamental public policy.

(But remember, this defense does not apply to recognition of judgments!)

Question 29

What is the procedural rules defense to choice of law?

Answer 29

Regardless of the outcome of the choice of law analysis, the forum court will always apply its own procedural rules.

Question 30

Are statutes of limitations procedural or substantive?

Answer 30

They are procedural, but they are considered substantive for Erie purposes.

For federal-state question: SoL = substantive (federal court would apply state’s SoL).

For state-state question: SoL = procedural (forum state would apply its own SoL).

BUT – keep an eye out for borrowing statutes and limitations that condition a substantive right.

Question 31

What does it mean if a state has a borrowing statute?

Answer 31

The court should look at both the forum statute of limitations period and the foreign limitations period, and then apply the shorter period.

Question 32

What happens if a foreign statute creates a right to recover and imposes and SoL on that right?

Answer 32

The entire statute should be applied, including the SoL.

E.g., wrongful death statutes