Choice-of-Law Rules for Specific Areas of Law

Question 1

What choice-of-law rule applies in torts?

Answer 1

Traditional approach (First Restatement) – apply law of the state where the injury occurred (Lex loci delecti)

Modern approach (Second Restatement) -- To determine which state has "most significant relationship" to any particular issue, consider policies and interests at stake for:
\+ states where parties are domiciled
\+ state where injury occurred

Question 2

Dram Shop choice-of-law exception

Answer 2

Instead of applying substantive law of state where injury occurred, forum usually applies law of state where the tavern is located, EXCEPT when:

+ tavern in question uses advertising to target residents of another state,

AND

+ tavern keeper can anticipate that out-of-state residents could return to their home state shortly after drinking at tavern.

Question 3

How can parties stipulate choice-of-law in a contract?

Answer 3

Parties can agree to apply law of certain state if it is EXPRESSLY stated in the contract AND:

+ stipulation doesn’t appear as boilerplate language in adhesion contract,

+ parties picked a state that has a substantial relation to the contract, AND

+ law of the parties’ chosen state does not violate public policy of that state with the most significant relationship to issue in question.

Question 4

What choice-of-law applies in contracts if there is no stipulation?

Answer 4

Traditional approach (First Restatement) – apply law of state where K was made (Lex loci contractus)

Modern approach (Second Restatement) – determine “most significant relationship” by considering policies and interests of those states where:
+ parties negotiated K
+ parties made K
+ performance obligations were to be met
+ subject matter of K is located
+ parties are domiciled, reside, conduct business, or are incorporated

K’s governed by UCC – if no stipulation by parties, a state’s UCC can apply to any transaction that bears an appropriate relation to that state.

Question 5

What choice-of-law applies in family law?

Answer 5

Validity of marriage – apply law of the state where the ceremony took place.

Divorce proceeding – apply law of the forum