Conflict of Laws

Question 1

General Rule for Contracts

Answer 1

Traditionally use law of the place where the contract was entered into… but now
Michigan emphasizes the law of the place having the most significant relation wit the matter in dispute as being the proper metric.

Michigan uses most significant relationship test of the Restatement (Second) of Conflicts, which examines the following five factors:

1) the place of contracting;
2) the place of negotiations of the contract;
3) the place of performance;
4) the location of the subject matter of the contract; and
5) the domicile, residence, nationality, place of incorporation and place of business of the parties

Question 2

Exceptions to Rule for Contracts

Answer 2

Two exceptions if the parties choice of law should govern if the issue is one the parties could have resolved by an express contractual provision

1) the choice of law will not be followed if the chosen state has no substantial relationship to the parties or the transactions, or when there is no reasonable basis for choosing that state’s law
2) bars the application of the chosen state’s law when it would be contrary to a fundamental policy of a state which has a materially materially greater interest than the chosen state in the determination of the particular issue would be the state the applicable law in the absence of an effective choice of law by the parties

Question 3

Statute of Limitations

Answer 3

Michigan has borrowing statute to use in specific instances where the SOL is an issue:

• if a nonresident (someone who is not a resident of Michigan when the cause of action arose) brings suit in Michigan for an action which accused outside, the suit will be time-barred if it is time-barred under either Michigan or the other state’s statute of limitations
• If MI resident brings suit in MI on a cause of action which accused outside of MI, the MI statute of limitations applies

Question 4

General Rule for Torts

Answer 4

Michigan courts apply Michigan law unless there is a “rational reason” to do otherwise. (Sutherland)

To determine whether a rational relation exists, the court will examiners two factors:

1) First, whether any foreign state has an interest in having its law applied. If not, Michigan law will apply. If so, move on to next question.
2) Second, look at whether Michigan’s interest mandates that MI law will applied, despite the foreign state’s interest. The court exams the following factors from Second Restatement:
- the place where the injury occurred
- the place where the conduct causing the injury occurred
- the domicile, residence, nationality, place of incorporation, and place of business of the parties; and
- the place where the relationship, if any, between the parties is created