Conflicts of Law Outline

I. CHOICE OF LAW

• A. INTRODUCTION
• 1. Choice of Law issues arise when the laws of more than one jurisdiction arguably apply to a dispute.
• 2. Terminology
• Forum: The state in which the lawsuit is filed.
• Forum Law: The law of the state where the lawsuit is filed.
• Foreign Law: The law of a jurisdiction other than the forum state.
• 3. Choice of Law in Federal Court: In a federal case, apply the choice of law rules of the state where the court sits.
• This is known as the Klaxon Rule.
• Exception: If the case was transferred from a federal court in another state, apply the choice of law rules of the original court.
• B. GENERAL APPROACHES TO CHOICE OF LAW
• 1. Traditional Approach (First Restatement)
• Focus: Where the legally significant event that created the right occurred.
• Process:
• Identify the legally significant event.
• Determine where that event occurred.
• Apply the law of that place.
• Example: A car accident occurs in State A. A lawsuit is filed in State B. The traditional approach would apply the law of State A because that is where the accident occurred.
• 2. Governmental Interest Analysis
• Focus: Which state has the greatest interest in applying its law to the dispute.
• Process:
• Identify the policies behind the competing state laws.
• Determine which states have a legitimate interest in applying their laws.
• If only one state has an interest, apply that state's law. This is a "false conflict."
• If more than one state has an interest, this is a "true conflict." The court will usually apply the law of the forum state.
• If no state has an interest, apply the law of the forum state.
• Types of Laws:
• Conduct-Regulating Laws: Laws designed to regulate conduct.
• Loss-Shifting Laws: Laws that determine who can or cannot be liable.
• 3. Most Significant Relationship Test (Second Restatement)
• Focus: Which state has the most significant relationship to the issue.
• Process:
• Consider seven guiding principles to determine the state with the most significant relationship.
• Consider the connecting factors related to the specific legal issue.
• Apply the law of the state with the most significant relationship.
• Guiding Principles:
• Promoting the relevant policies of the forum and other interested states.
• Protecting justified expectations.
• Advancing certainty, uniformity, predictability, and simplicity.
• Tie Breaker: If no state has a more significant relationship, courts apply forum law.
• C. SPECIAL ISSUES
• 1. Depecage: The application of different states' laws to different issues in the same case.
• 2. Renvoi: When the court applies the whole law of another state, including that state's choice of law rules.
• Accepting the Renvoi: Applying the other state's choice of law rules.
• Rejecting the Renvoi: Ignoring the other state's choice of law rules and applying the other state's substantive law directly.
• Generally Rejected: Except for issues involving property rights in land, courts generally reject renvoi.
• D. DEFENSES AGAINST APPLICATION OF FOREIGN LAW
• 1. Procedural vs. Substantive: Forum law always governs procedural issues.
• Substantive Laws: Regulate behavior outside of court.
• Procedural Laws: Regulate behavior inside court.
• 2. Public Policy Exception: Courts may refuse to apply foreign law that violates the forum's strong public policy.
• Narrow Defense: Applies only to egregious violations.
• Not Applicable to Defenses: Can only be used to reject a foreign cause of action, not a foreign defense.
• 3. Penal Law Exception: Courts will not enforce the penal laws of another state.
• Penal Laws: Laws that punish an offense against the public.
• Tax Laws: Not considered penal laws.
• E. CONSTITUTIONAL LIMITATIONS
• 1. Due Process: Choice of law must not be arbitrary or fundamentally unfair.
• Requirement: The state must have significant contacts with the dispute to apply its law.
• 2. Full Faith and Credit: A state must recognize and enforce the judgments of other states.
• Limitations:
• Must be a final judgment.
• Must be on the merits.
• Rendering court must have had proper jurisdiction.
• No Public Policy Exception: States cannot refuse to enforce other states' judgments based on public policy.
• Last in Time Rule: If there are conflicting judgments, the most recent judgment prevails.
• 3. Privileges and Immunities Clause: Prevents states from discriminating against citizens of other states.

II. SPECIFIC AREAS OF LAW

• A. TORTS
• 1. Traditional Approach: Apply the law of the place where the injury occurred.
• 2. Governmental Interest Analysis: Apply the law of the state with the most significant interest in the outcome.
• 3. Second Restatement: Apply the law of the state with the most significant relationship to the occurrence and the parties.
• Consider these contacts:
• Place of injury.
• Place where the conduct causing injury occurred.
• Domicile, residence, or place of business of the parties.
• Place where the relationship between the parties is centered.
• Presumption: The law of the place of injury will usually be applied, but can be overcome.
• Multiple States: If the injury occurs in multiple states, apply the law of the plaintiff's domicile if the injury also occurred there.
• B. CONTRACTS
• 1. Choice of Law Clause: If the contract contains a valid and enforceable choice of law clause, that clause will govern.
• Exception: Validity of a contract cannot be resolved solely by the choice of law provision.
• 2. Validity of a Contract:
• Second Restatement: Parties can choose the law governing validity if:
• The chosen state has a substantial relationship to the parties or the transaction; or
• There is some other reasonable basis for the choice.
• Public Policy Exception: Courts may ignore the choice of law provision if it would violate a fundamental policy of the state with the most significant relationship to the issue.
• 3. Traditional Approach: The law of the place of contracting governs issues of contract formation, interpretation, and validity.
• Place of Contracting: Where the last act necessary to make the contract binding occurred.
• Performance Issues: Governed by the law of the place of performance.
• 4. Second Restatement: Determine the state with the most significant relationship to the contract.
• Consider these contacts:
• Place of contracting, negotiation, and performance.
• Location of the subject matter of the contract.
• Domicile, residence, place of incorporation, or place of business of the parties.
• Presumption: If the location of negotiation and performance are the same, the law of that state applies.
• C. PROPERTY
• 1. Types of Property
• Real Property (Immovables): Land and interests in land.
• Personal Property (Movables): All property other than land.
• Tangible: Property that can be touched (e.g., cars, furniture).
• Intangible: Property that cannot be touched (e.g., stocks, patents).
• 2. Real Property: All three approaches generally apply the law of the situs (where the property is located).
• Second Restatement: Still considers seven guiding principles, with a strong presumption in favor of the law of the situs.
• Land Incidental to a Contract: If the land is merely incidental to the contract, apply the contracts approach.
• 3. Personal Property:
• Tangible Property:
• UCC: Apply the UCC, which allows parties to choose the applicable law.
• No UCC: First and Second Restatement apply the law of the situs at the time of the transaction.
• Intangible Property:
• First Restatement: Law of the state where the property was created.
• Second Restatement: Considers the seven guiding factors.
• 4. Succession of Property at Death:
• Immovable Property: Law of the situs.
• Movable Property: Law of the decedent's domicile at the time of death.
• Choice of Law Clause: Many states will enforce a choice of law clause in a will or trust.
• Validity: If a will or trust is valid under the law where it was made, courts generally enforce it.
• D. CORPORATIONS
• 1. Internal Affairs: Governed by the law of the state of incorporation.
• 2. External Relations: Governed by the choice of law rules of the area of law involved.
• Second Restatement Contacts: Place of incorporation and principal place of business.
• E. FAMILY LAW
• 1. Marriage
• Traditional Approach: Valid where celebrated, unless it violates a strong public policy of the domicile of either party.
• First Restatement: Distinguishes between validity and incidents of marriage.
• Validity: Governed by the law of the place of celebration.
• Incidents: Determined by the law of the place where they are sought to be exercised.
• Second Restatement: Valid where celebrated, unless it violates the public policy of the state with the most significant relationship to the parties at the time of marriage.
• 2. Marital Property
• Immovable Property: Law of the situs.
• Movable Property: Law of the state where the couple was domiciled at the time of acquisition.
• 3. Divorce
• Jurisdiction Requirement: At least one spouse must be domiciled in the state granting the divorce.
• Bilateral Divorce: Personal jurisdiction over both spouses.
• Entitled to full faith and credit.
• Ex Parte Divorce: Personal jurisdiction over only one spouse.
• Entitled to full faith and credit for the divorce decree itself.
• Other orders (property, alimony, etc.) are valid only if the court had personal jurisdiction over both spouses.
• Estoppel: An interested party may challenge the validity of a divorce, except for parties, privies, those remarrying in reliance, or strangers with no standing.
• 4. Child Custody and Support
• UCCJEA: Governs jurisdiction and enforcement of child custody and support orders.
• Exclusive Jurisdiction: One state has exclusive jurisdiction to make initial custody decisions.
• Modification: Only possible if the original state no longer has jurisdiction or the new state meets the requirements for exclusive jurisdiction.
• 5. Foreign Country Judgments
• Not Subject to Full Faith and Credit: Enforced under comity.
• Comity: Recognition based on mutual respect among nations.
• Uniform Foreign Money Judgment Recognition Act:
• Enforces foreign money judgments in the same way as sister state judgments.
• Does not cover non-money judgments, but they may be enforced under comity.

III. IMPORTANT CONCEPTS TO KNOW FOR THE UBE

• Domicile
• Definition: The place where a person has their true, fixed, and permanent home, and to which they intend to return whenever absent.
• Importance: Determines which state's laws apply to certain issues, such as divorce and probate.
• Types:
• Domicile by Choice: Acquired by physical presence in a state and the intent to remain indefinitely.
• Proof of Intent: Owning real estate, voting, paying taxes, banking, vehicle registration.
• Domicile by Operation of Law: Applies to those lacking legal capacity (minors, incompetents).
• Minors: Domicile of custodial parent(s).
• Incompetents: Retain domicile from before incompetency.
• Corporations: Domiciled in the state of incorporation.
• Continuity: Presumed to continue until a new one is acquired.
• Change: Requires physical presence in a new place and intent to make it home.
• Substance vs. Procedure
• General Rule: Forum law governs procedural rules, foreign law governs substantive rules.
• Statute of Limitations: Generally procedural.
• Exception: If part of the right, not just the remedy, it's substantive.
• Rules of Evidence: Generally procedural.
• Exception: If outcome determinative, it's substantive.
• Burden of Proof: Generally procedural.
• Presumptions:
• Rebuttable: Procedural.
• Conclusive: Substantive.
• Parol Evidence Rule: Substantive.
• Statute of Frauds: Substantive.
• Damages:
• First Restatement: Procedural.
• Second Restatement: Governed by the law of the state with the most significant relationship.
• Full Faith and Credit
• Definition: Constitutional requirement that states must enforce the final judgments of other states.
• Requirements for Enforcement:
• Final judgment.
• On the merits.
• Rendering court had proper jurisdiction.
• Defenses:
• Lack of jurisdiction in rendering court.
• Judgment procured by fraud.
• Judgment not final.
• Judgment not on the merits.
• Comity
• Definition: The principle of recognizing and enforcing the laws and judicial decisions of other countries, based on mutual respect.

Application: Used to enforce judgments from foreign countries that are not subject to the Full Faith and Credit Clause.