Wed. Feb. 12
pleading and proving
foreign law
• FRCP 44.1
• A party who intends to raise an issue
concerning the law of a foreign
country shall give notice by
pleadings or other reasonable
written notice. The court, in
determining foreign law, may
consider any relevant material or
source, including testimony, whether
or not submitted by a party or
admissible under the Federal Rules
of Evidence. The court's
determination shall be treated as a
ruling on a question of law.
failure to plead foreign law
- presume complaint is sufficient
- court may introduce foreign law
sua sponte?
- court must introduce foreign law
sua sponte?
failure to offer evidence of foreign
law
- put burden on plaintiff and dismiss
- put burden on party best able to
identify law
- put burden on court?
- use presumption about what law is
like to allow case to proceed
- Swift v. Tyson
- federal and sister state courts
would come to own judgment
about the general common law in a
state even in the face of contrary
decisions by the state’s courts
presumptions
- that common law applies in a
common law jurisdiction (that is, has
not been abrogated by statute)
- that fundamental law applies in a
jurisdiction
- that law of the jurisdiction is like the
forum’s
- New York state courts assume
that unsettled sister state law is the
same as New York law
- P sues D in federal court in New
York on an unsettled Pa cause of
action…
- A nationwide class action is
brought in NY state court
concerning a provision in the UCC
- New York courts have read the
provision in one way
- 6 other states have read the same
provision a different way
- what about the 43 other states…?
Walton v Arabian American Oil Co (2d Cir
1956)
Louknitsky v. Louknitsky
- California state court determining
spousal rights in marital property of
couple, now domiciled in Ca., while
they were in China
- presumed Chinese law was the same
as California’s community property
system
• Borrowing statutes
• Bridge Prods. Inc. v. Quantum Chem. Corp.
(ND Ill 1990)
• Property bought in VA
• Del choice of law provision in K
• Suit in Ill
• Should court use Del statute of limitations?
• Or should it use the statute of limitations that
would be applied by an Illinois court?
– In this case it was VA’s
Party Autonomy
• Choice-of-law clauses in contracts
• Choice of law that validates contracts
– Could be used even when no choice-of-law
provisions exists
– Could be used to choose law other than the law in
the choice-of-law clause
Rest 2d § 188. Law Governing In Absence Of Effective
Choice By The Parties
• (1) The rights and duties of the parties with respect
to an issue in contract are determined by the local
law of the state which, with respect to that issue, has
the most significant relationship to the transaction
and the parties under the principles stated in § 6.
• …
• (3) If the place of negotiating the contract and the
place of performance are in the same state, the local
law of this state will usually be applied, except as
otherwise provided in §§ 189-199 and 203.
Rest. 2d § 203. Usury
• The validity of a contract will be sustained
against the charge of usury if it provides for a
rate of interest that is permissible in a state to
which the contract has a substantial
relationship and is not greatly in excess of the
rate permitted by the general usury law of the
state of the otherwise applicable law under
the rule of § 188.
- two NYers enter into a loan contract in
Illinois
- interest is 19 %, the maximum allowed
in Ill
- the maximum in NY is 18%
- what if the maximum in NY was 12%?
• Two NYers contract in NY to ship goods in NY
• Under NY law the receiving party is excused
from paying until they are received
• Under Japanese law must pay unless actual
breach is clear
• Can the parties say Japanese law apply with
respect to the issue?
Rest 2d § 187. Law Of The State Chosen By The
Parties
• (1) The law of the state chosen by the parties
to govern their contractual rights and duties
will be applied if the particular issue is one
which the parties could have resolved by an
explicit provision in their agreement directed
to that issue.
• default rules v. mandatory rules
“We think it clear that the federal
conflicts rule will give effect to the
parties’ intention that English law
is to apply to the interpretation of
the contract.”
• What if Japanese law considers the matter a
default rule, but New York law considers a
mandatory rule?
• Whether the parties could have determined a
particular issue by explicit agreement directed
to that issue is a question to be determined by
the local law of the state selected by
application of the rule of § 188. Usually,
however, this will be a question that would be
decided the same way by the relevant local
law rules of all the potentially interested
states. On such occasions, there is no need for
the forum to determine the state of the
applicable law.
- a NY court is considering a contract
entered into in NY between a 17 year old
NYer and another NYer
- under NY law the contract is voidable by
the 17 year old
- will the court enforce a provision stating
that the contract is not voidable by any
party?
- will the court enforce a provision stating
that PA law (which has no protection for
17 year olds) applies?
- a NY court is considering a contract
entered into in NY between a 17
year old NYer and a Pennsylvanian
- will the court enforce a provision
stating that PA law (which has no
protection for 17 year olds) applies?
Seigelman v. Cunard White Star Line (2d Cir
1955)
• 187(3) In the absence of a contrary indication
of intention, the reference is to the local law
of the state of the chosen law.
187(2) The law of the state chosen by the parties to
govern their contractual rights and duties will be
applied, even if the particular issue is one which the
parties could not have resolved by an explicit
provision in their agreement directed to that issue,
unless either
(a) the chosen state has no substantial relationship
to the parties or the transaction and there is no
other reasonable basis for the parties' choice, or
• (b) application of the law of the chosen state
would be contrary to a fundamental policy of
a state which has a materially greater interest
than the chosen state in the determination of
the particular issue and which, under the rule
of § 188, would be the state of the applicable
law in the absence of an effective choice of
law by the parties.
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Mass Insurer contracts with NH insured
K says law of Mass applies
K entered into in NH
insured misstates the distance of house from
fire hydrant
house burns down
under law of Mass, no rights under K because
of misstatement
under law of NH, still has rights
assume that most significant relationship is
with NH law
• P (Mass) and D (Maine) enter into a contract
in Maine with performance in Maine
• The contract says that the law of Mass applies
• Under Mass law D has no capacity to contract,
because she is a married woman
• Under Maine law, she has such a capacity
• On occasion, the parties may choose a law that would
declare the contract invalid. In such situations, the chosen
law will not be applied by reason of the parties' choice. To
do so would defeat the expectations of the parties which it
is the purpose of the present rule to protect. The parties
can be assumed to have intended that the provisions of the
contract would be binding upon them. If the parties have
chosen a law that would invalidate the contract, it can be
assumed that they did so by mistake. If, however, the
chosen law is that of the state of the otherwise applicable
law under the rule of § 188, this law will be applied even
when it invalidates the contract. Such application will be by
reason of the rule of § 188, and not by reason of the fact
that this was the law chosen by the parties.
interest analysis
- P (NY) is suing D (NY) concerning a
car accident in New York, under a
law providing for treble damages
for accidents on highways
- D, appeals to a law limiting
recovery to $10,000 when against
police officers who were acting in
the course of his duty
false conflicts
- P (NY) sues D (NY) concerning a car
accident in NY
- NY has law saying anyone who is
grossly negligent shall be liable for
harm
- NJ has law saying anyone who is
negligent shall be liable for harm
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Millikan v Pratt
• Mass D contracted with Maine Ps to
guarantee D’s husband’s payment
• Sent by her husband by mail from Mass to
Maine
• D’s husband did not pay
• Ps demanded of D
• She refused
• Mass had law not allowing married women to
contract as surety
• NH didn’t