Choice of Law Flashcards
Torts - Vested Rights - 1st Restatement
Court will apply the law of the state where the injury occurred
Torts - Most Significant Relationship - 2nd Restatement
Court will consider connecting facts and policy principles
Torts - Most Significant Relationship - Connecting Facts
Iggy Can’t Drink Rum
- place of Injury
- place where Conduct causing the injury occurred
- Domicile, residence, nationality, place of incorporation, and place of business of the parties, and
- place where Relationship between the parties is centered
Torts - Most Significant Relationship - Policy Principles
I FOE FUD
- Needs of interstate and international systems
- relevant policies of the forum
- relevant policies of other interested states and the relative interests of those states in the determination of the particular issue
- the protection of justified expectations
- basic policies underlying the particular field of law
- certainty, predictability, and uniformity of result
- ease in the determination and application of the laws to be applied
Full Faith and Credit
- If the rendering court is a court in a sister state, then the source of the obligation to recognize the judgment is constitutional under full faith and credit
Requirements:
1) The rendering state must have had jurisdiction over the parties and the subject matter - Exception: when the issue of jurisdiction has been fully and fairly litigated, then the jurisdictional determination is itself entitled to full faith and credit
2) The judgment entered by the rendering state must have been on the merits (consent judgments included)
3) The judgment entered by the rendering court must be a final judgment
Defenses to Full Faith and Credit
Not entitled to Full Faith & Credit
1) Penal judgments: punishes an offense against the public
2) Extrinsic fraud: fraud that could not be corrected during the regular course of proceedings leading to the judgment
Attractive but Invalid Defenses
1) Public Policy: disapproval not enough
2) Mistakes: If mistakes were made, they should have been challenged through an appeal in the rendering state
Foreign Judgments
If the rendering court is a court in a foreign country, then the source of the obligation to recognize the judgment is comity or treaty
- Comity: a recognizing court will exercise discretion to decide whether the foreign judgment should be recognized
Questions to consider:
- Did the foreign court have jurisdiction?
- Were procedures in the foreign court fair?
Choice of Law
2 conditions must be met:
1) lawsuit involves factual connections with multiple states
2) Multiple states will have different laws leading to different results
Which state’s law will govern? The governing law is the law selected by the forum court according to its choice of law approach
Exceptions:
1) Diversity cases in federal court: a federal court sitting in diversity applies the choice of law approach of the state in which it sits
2) Transferred diversity cases: when a diversity case is transferred within the federal system, the federal court applies the choice of law approach of the transferor court
Restrictions that limit the forum court’s choice of law
1) Constitutional: Due Process and Full Faith and Credit
Rule: The Consitution 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
Rule: If the forum state has a statute that directs a choice of law, then the forum court should apply that statute instead of the usual choice of law approach.
Structure of Choice of Law Answer
Issue: 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 (fill in applicable choice of law approach)
Rule: Plug in the rule for the applicable choice of law approach (vested rights, interest analysis, most significant relationship)
Application: Apply the choice of law approach
Conclusion: Governing law and the result
Vested Rights
Under this approach, the court will apply the law of the state mandated by the applicable vesting rule. That rule is selected according to the relevant substantive area of law.
Example application: “This is a torts case. Therefore, the applicable vesting rule is the place of injury. Here, the injury occurred in Michigan and thus Michigan law applies. Under Michigan law, a non-paying passenger cannot recover against the driver, and so the claim is barred.”
Interest Analysis
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.
Example application: “In this case, only Illinois has a legitimate interest. It is interested in permitting recovery to compensate its injured resident (the plaintiff). Michigan is not interested in applying its restriction against recovery simply because the accident occurred there. Rather, it would be interested in applying its restriction only if the defendant were a Michigan resident. But the defendant in this case is from Illinois, so Michigan is not interested. This case is therefore a false conflict, and Illinois law should apply. Under Illinois law, the plaintiff may recover.”
Most Significant Relationship
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 (where) and policy principles (why).
Example application: “In this case, the factual connections are split. The accident occurred in Michigan, and the injury was sustained there. But both the plaintiff and the defendant are from Illinois. As a matter of policy, Illinois seems to have the greater interest because the law at issue is a loss distribution rule and both parties share an Illinois domicile. As a result, Illinois appears to have the most significant relationship to the dispute and its law should apply. Under Illinois law, the plaintiff may recover.”
Substantive Area - Torts
Vesting Rule: Governing law is where the injury occurred.
Second Restatement: Factual connections: 1) Place of injury, 2) place of conduct that caused injury, 3) Place where the parties are home, 4) Place where the relationship, if any, is centered. Policy principles: 1) relevant policies of the forum state, 2) relevant policies of other connected states
