Conflict of laws

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Conflict of laws
 
Preliminiaries
Characterisation
Incidental question
Renvoi · Choice of law Public policy
Hague Conference
Definitional elements
Jurisdiction
Procedure
Forum non conveniens
Lex causae
Lex fori · Forum shopping
Lis alibi pendens
Connecting factors
Domicile · Lex domicilii
Habitual residence
Nationality · Lex patriae
Lex loci arbitri · Lex situs
Lex loci contractus
Lex loci delicti commissi
Lex loci actus
Lex loci solutionis
Proper law
Lex loci celebrationis
Choice of law clause
Dépeçage
Forum selection clause
Substantive legal areas
Status · Capacity · Contract
Tort · Marriage · Nullity
Divorce (Get · Talaq)
Property · Succession
Trusts
Enforcement
Mareva injunctions
Anti-suit injunctions

Conflict of laws (or private international law) is a set of rules of procedural law which determine which legal system and the law of which jurisdiction apply to a given legal dispute. They typically apply when a legal dispute has a "foreign" element such as a contract agreed by parties located in different countries, although the "foreign" element also exists in multi-jurisdictional countries such as the United Kingdom and the United States.

The term conflict of laws itself originates from situations where the ultimate outcome of a legal dispute depended upon which law applied, and the common law courts manner of resolving the conflict between those laws. In civil law lawyers and legal scholars refer to conflict of laws as private international law. However it should be noted that private international law has no real connection with public international law, and is instead a feature of municipal law which can and does vary from country to country.

Terminology

Its three different names – conflict of laws, private international law, and international private law – are generally interchangeable, although none of them is wholly accurate or properly descriptive. The term conflict of laws is primarily used in jurisdictions of the Common Law legal tradition, such as in the United States, England, Canada, and Australia. Private international law (droit international privé) is used in France, as well as in Italy, Greece, and the Spanish and Portuguese speaking countries. International private law (internationales Privatrecht) is used in Germany and other German-speaking countries.

Within the federal systems where legal conflicts among federal states require resolution, as in the United States, the term conflict of laws is preferred simply because such cases do not involve an international issue. Hence, conflict of laws is a general term to refer to disparities among laws, regardless of whether the relevant legal systems are international or inter-state. The term, however, can be misleading when it refers to resolution of conflicts between competing systems rather than "conflict" itself. The term conflict of laws is usually used by common law countries, while for civil law countries the term private international law is more appropriate. The term private international law was coined by American lawyer and judge Joseph Story, but was abandoned subsequently by common law scholars and embraced by civil law lawyers.

History

The first instances of conflict of laws in the Western legal tradition can be traced to Greek law. Ancient Greeks dealt straightforwardly with multistate problems, and did not create choice-of-law rules. Leading solutions varied between the creation of courts for international cases, or application of local law, on the grounds that it was equally available to citizens of all states.[1].

More significant developments can be traced to Roman law. Roman civil law (jus civile) being inapplicable to non-citizens, special tribunals had jurisdiction to deal with multistate cases. The officers of these specialized tribunals were known as the praetor peregrini. The Praetor peregrini did not select a jurisdiction whose rules of law should apply. Instead, they "applied" the "jus gentium." The jus gentium was a flexible and loosely-defined body of law based on international norms. Thus the praetor peregrini essentially created new substantive law for each case.[2] Today, this is called a "substantive" solution to the choice-of-law issue.

The modern conflict of laws is generally considered to have begun in Northern Italy during the late Middle Ages and in particular at trading cities such as Genoa, Pisa and Venice. The need to adjudicate issues involving commercial transactions between traders belonging to different cities led to the development of the theory of statuta, whereby certain city laws would be considered as statuta personalia "following" the person whereby it may act, and other city laws would be considered as statuta realia, resulting in application of the law of the city where e.g. the res would be located (cf. lex rei sitae).

Maritime law was also a great driver of international legal rules; providing for the enforcement of contracts, the protection of shipwrecked sailors and property, and the maintaining of harbours.[3]

The modern field of conflicts emerged in the United States during the 19th century with the publishing of Joseph Story's treatise on the Conflict of Laws in 1834. Story's work had a great influence on the subsequent development of the field in England such as those written by A.V. Dicey. Much of the English law then became the basis for conflict of laws for most commonwealth countries.

However, in the U.S., Story's work fell out of fashion in the mid-20th century. Traditional conflict of law rules were widely perceived as too rigid and unresponsive to the needs of a highly mobile society undergoing the Second Industrial Revolution. They were replaced with a number of approaches, of which the most important is the governmental interests analysis pioneered by law professor Brainerd Currie in a landmark series of essays. As a result of Currie's work, the rules for conflict of laws in the United States have diverged significantly from the rules in use at the international level.

The stages in a conflict case

1. The court must first decide whether it has jurisdiction and, if so, whether it is the appropriate venue given the problem of forum shopping.
2. The next step is the characterisation of the cause of action into its component legal categories which may sometimes involve an incidental question (also note the distinction between procedural and substantive laws).
3. Each legal category has one or more choice of law rules to determine which of the competing laws should be applied to each issue. A key element in this may be the rules on renvoi.
4. Once the applicable law is decided, that law must be proved before the forum court and applied to reach a judgment.
5. The successful party must then enforce the judgment which will first involve the task of securing cross-border recognition of the judgment.

In those states with an underdeveloped set of Conflict rules, decisions on jurisdiction tend to be made on an ad hoc basis, with such choice of law rules as have been developed embedded into each subject area of private law and tending to favour the application of the lex fori or local law. In states with a more mature system, the set of Conflict rules stands apart from the local private civil law and adopts a more international point of view both in its terminology and concepts. For example, in the European Union, all major jurisdictional matters are regulated under the Brussels Regime, e.g. the rule of lis alibi pendens from Brussels 1 Regulation applies in the Member States and its interpretation is controlled by the European Court of Justice rather than by local courts. That and other elements of the Conflict rules are produced supranationally and implemented by treaty or convention. Because these rules are directly connected with aspects of sovereignty and the extraterritorial application of laws in the courts of the signatory states, they take on a flavour of public rather than private law because each state is compromising the usual expectations of their own citizens that they will have access to their local courts, and that local laws will apply in those local courts. Such aspects of public policy have direct constitutional significance whether applied in the European context or in federated nations such as the United States, Canada, and Australia where the courts have to contend not only with jurisdiction and law conflicts between the constituent states or territories, but also as between state and federal courts, and as between constituent states and relevant laws from other states outside the federation.

Choice of law rules

Courts faced with a choice of law issue have a two-stage process:

1. the court will apply the law of the forum (lex fori) to all procedural matters (including, self-evidently, the choice of law rules); and
2. it counts the factors that connect or link the legal issues to the laws of potentially relevant states and applies the laws that have the greatest connection, e.g. the law of nationality (lex patriae) or domicile (lex domicilii) will define legal status and capacity, the law of the state in which land is situated (lex situs) will be applied to determine all questions of title, the law of the place where a transaction physically takes place or of the occurrence that gave rise to the litigation (lex loci actus) will often be the controlling law selected when the matter is substantive, but the proper law has become a more common choice.

For example, suppose that Alexandre who has a French nationality and residence in Germany, corresponds with Bob who has American nationality, domicile in Arizona, and residence in Austria, over the internet. They agree to the joint purchase of land in Switzerland, currently owned by Heidi who is a Swiss national, but they never physically meet, executing initial contract documents by using fax machines, followed by a postal exchange of hard copies. Alexandre pays his share of the deposit but, before the transaction is completed, Bob admits that although he has capacity to buy land under his lex domicilii and the law of his residence, he is too young to own land under Swiss law. The rules to determine which courts would have jurisdiction and which laws would be applied to each aspect of the case are defined in each state's laws so, in theory, no matter which court in which country actually accepts the case, the outcome will be the same (albeit that the measure of damages might differ from country to country which is why forum shopping is such a problem). In reality, however, moves to harmonise the conflictual system have not reached the point where standardisation of outcome can be guaranteed.