Also known as: choice-of-law doctrine · choice of law doctrines · choice of law · conflict of laws
Written by attorneys — see sources below.
A body of rules that determines which jurisdiction's substantive law governs a dispute with contacts in more than one state. Courts apply these rules to select the law of the state with the most significant relationship to the issue or to follow statutory directives that validate acts under alternative connecting factors such as place of execution or domicile.
Cobalt Energy, a Delaware corporation with its principal place of business in State A, sues Canyon Construction, a State B firm, in federal court in State A over a construction contract performed partly in State B. The court applies State A's choice of law rules to decide whether State A or State B substantive law governs the breach claim.
Charles Cunningham purchases land in State B from Christine Castro under a contract negotiated in State A that selects State A law. When a neighboring owner asserts an easement based on long use in State B, the court weighs the most significant relationship factors to determine whether State A or State B law governs the easement claim.
Cameron Cruz, domiciled in State A at the time, executes a will before a notary in Switzerland while maintaining an apartment there. After moving to State B where he dies, the probate court applies the statute allowing validation under the law of the place of execution or place of abode at execution to uphold the will.
Crown Pharmaceuticals, headquartered in State A, is sued in federal court in State A by a plaintiff injured in State B. The court follows State A's conflict rules to select which state's substantive tort law applies to the product liability claim.
Curtis Cannon sues in federal court in State A on a state-law claim that would be time-barred under State A law but timely under State B law. The court applies State A's statute of limitations as the outcome-determinative rule that must be followed in diversity.
In May 1930 the Van Sweringen Corporation issued $30,000,000 in notes under an indenture naming Guaranty Trust Co. of New York as trustee with power to enforce noteholders' rights. In October 1930 Guaranty and other banks advanced large sums to companies affiliated with the Corporation and controlled by the Van Sweringens. When the Corporation could not meet its obligations, Guaranty participated in an exchange plan under which noteholders could surrender their notes for cash equal to 50 percent of face value plus twenty shares of Van Sweringen stock per $1,000 note; the offer remained open until December 15, 1931. In 1934 respondent York received $6,000 of the notes as a gift from a donor who had not accepted the exchange offer. In April 1940 three accepting noteholders filed the Hackner suit in federal court charging Guaranty with fraud and misrepresentation in connection with the exchange. York's motion to intervene was denied, and summary judgment for Guaranty was affirmed on appeal. On January 22, 1942, after her exclusion from the Hackner litigation, York filed the present class action in the United States District Court for the Southern District of New York on behalf of non-accepting noteholders. The complaint, resting exclusively on diversity of citizenship, alleged that Guaranty had breached its trust by failing to protect noteholders' interests when it assented to the exchange offer and by failing to disclose its own self-interest. The district court granted Guaranty's motion for summary judgment on the authority of the Hackner decision. The Circuit Court of Appeals reversed, holding that a federal court sitting in equity is not required to apply the New York statute of limitations that would govern an identical suit in the New York state courts. The Supreme Court granted certiorari.
View caseChristopher Collins files a diversity action in federal court in State A and serves process under the federal rule allowing service by mail. The defendant moves to dismiss for improper service under stricter State A requirements. The court applies the federal rule because it directly conflicts with and displaces the state practice.
On February 6, 1963, petitioner, a citizen of Ohio, filed her complaint in the District Court for the District of Massachusetts, claiming damages in excess of $10,000 for personal injuries resulting from an automobile accident in South Carolina, allegedly caused by the negligence of one Louise Plumer Osgood, a Massachusetts citizen deceased at the time of the filing of the complaint. Respondent, Mrs. Osgood's executor and also a Massachusetts citizen, was named as defendant. On February 8, service was made by leaving copies of the summons and the complaint with respondent's wife at his residence, concededly in compliance with Rule 4 (d) (1). Respondent filed his answer on February 26, alleging, inter alia, that the action could not be maintained because it had been brought contrary to and in violation of the provisions of Massachusetts General Laws Chapter 197, Section 9. On October 17, 1963, the District Court granted respondent's motion for summary judgment. On appeal, the Court of Appeals for the First Circuit affirmed. The Supreme Court granted certiorari because of the threat to the goal of uniformity of federal procedure posed by the decision below.
View caseA federal court sitting in diversity must apply the choice of law rules of the state in which it sits. Those rules are treated as substantive under Erie and therefore control the selection of which state's law governs the claim.
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The Restatement directs courts to evaluate the factors in section 6, giving special weight in property cases to protection of justified expectations because parties typically consult counsel and form reliance interests before transferring interests in land or chattels.
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A will is valid if executed in compliance with the Code's formalities or if execution satisfies the law of the place of execution, the testator's domicile, place of abode, or nationality at the time of execution or death.
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…particular problem for which it is used." Guaranty Trust Co. v. York, supra , at 108; Cook, The Logical and Legal Bases of the Conflict of Laws, pp. 154-183 (1942). It is true that both the Enabling Act and the Erie rule say, roughly, that federal courts are to apply state "substantive" law and federal "procedural" law, but from…