Choice of law Flashcards
When will choice of law issues generally arise?
1) Where lawsuit involves factual connections with two states and
2) That the multiple states will have different laws leading to different results.
What state’s law will govern?
The governing law selected but the forum court according to its choice of law approach (assuming no applicable constitutional or statutory restrictions)
What are the two exceptions to choice of law provisions?
1) Diversity cases in federal court, the federal court sitting in a diversity case applies the choice of law approach of the state it sits
2) Transferred diversity, when a diversity case is transferred within the federal system, the federal court applies the choice of law approach to the transferor court.
What are the two restrictions to choice of law provisions?
1) Constitutional, due process and full faith and credit. The constitution imposes a limit only if a state’s law is chosen that has no significant contact with and/or legitimate interest in the litigation
2) Statutory, if the forum state has a statute that directs choice of law, then the forum court should apply that statute instead of the usual choice of law approach (i.e. Borrowing statute)
What is New York’s choice of law approach?
1) 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 NY’s interest analysis approach to the choice of law
2) Under NY’s approach, the court will consider which states have legitimate interest in the outcome of the litigation. The court will apply New York law as long as it has a legitimate interest. If New York has no legitimate interest, the Court will apply the law of another interested state.
What is the four step process?
1) Discuss which states have legitimate interests
2) Characterise the type of conflict. False conflict, only one state has a legitimate interest. True conflict, two or more states have legitimate interest
3) Choose governing law based on type of conflict. False conflict, apply the law of the interested state. Trust conflict, if NY is interested apply NY.
4) Apply governing law to determine result.
The step two paragraph is different where it is TORTS. It needs to state: ‘This case involves a choice of law question relating to torts. New York will therefore apply the Neumeier rules to determine the governing law’. What is the Neumeier rule?
1) Where parties are domiciled in same state, apply the law of common domicile.
2) If the parties are domiciled in different states, apply the law of the place of the injury.
With contracts will choice of law provisions be enforced?
If valid and express yes. If the choice of law was included without true mutual assent and it has no reasonable relationship it is likely to be invalid and the normal choice of law test is to be applied.
What is the New York large contracts exception to general rule a choice of law provision will be invalid if law of NY has no reasonable relationship?
Where the contract with for at least $250k, parties may choose NY law even if there is no connection with NY. If contract wis for at least 1 million, the parties may choose NY law and may include a clause specifying NY as the forum. If contract for at least 1 million, parties may choose NY law and may include a clause specifying NY as the forum.
So what if our choice of law provision in contract is found to be invalid?
Then the court will look to governing law according to interest analysis EXCEPT where it is an automobile insurance contract. Here all issues regarding to rights and duties under an auto insurance policy are governed by the state where the policy was written.
What if there is a conflict of law with property?
For immovable property apply law of situs, for movable property, if case involves an intervivos transaction, apply the law of the situs at the time of the transaction. IF the case involves a matter relating to inheritance, apply the law of the decedent’s domicile at time of death.
If a marriage is valid where performed, will it be recognised as valid everywhere?
YES, unless where domiciliaries of one state temporarily relocate to another state to perform a marriage that violates a prohibitionary rule.
What divorce rules apply?
The forum will apply its own divorce laws. To acquire jurisdiction, at least one of the parties must be domiciled in the state. Therefore the state has an interest in applying its own law.
What are defenses to choice of law?
1) public policy.
2) procedural. Regardless of outcome of choice of law analysis, forum court will always apply its own procedural rules.
