Conflicts of Law Class Notes (Prof.

Hoffheimer)
1) JUDGEMENTS
a) Hilton v. Guyot, 159 U.S. 113 (1895)
i) Rule. A foreign judgment should be given full preclusive effect if
(1) Full and fair trial before a court of competent jurisdiction
(2) It was the product of regular proceedings
(3) It was decided after due citation or voluntary appearance; and
(4) The foreign system of justice was likely to secure the impartial
administration of justice between citizens of different countries.
(Reciprocity)
b) Tahan v. Hodgson, 662 F.2d 862 (D.C. Cir. 1981)
i) Service of Process. Even if were unable to read Hebrew, he ignored
them at his peril.
ii) Public Policy. It would be a mistake to find failure to find Fed Rules by a
foreign nation to be ipso facto a violation of American public policy. It
would be unrealistic to require all foreign judicial systems to adhere to the
Fed Rules of Civil Procedure.
iii) Reciprocity Requirement. It is unlikely that reciprocity is any longer a
federally mandated requirement for enforcement of foreign judgments or
that DC itself has such a requirement that this court is obliged to follow.
c) How do you get this into a court?
i) File a new lawsuit, seek exhibit 1 foreign judgment under the Uniform
Foreign Country Money Judgment Recognition Act (UFCMJA), and
therefore is entitled to Summary Judgment on the merits.
d) Uniform Foreign Country Money Judgment Recognition Act (UFCMJA)
i) Full faith and Credit applies to states, but not to foreign countries.
ii) The recognition of foreign judgments is governed primarily by state law.
(1) Common Law
(2) Model Act (UFCMJA)
(a) 1962- Original
(i) Followed by 13 states (Florida, Texas)
(b) 2005-Updated
(i) Followed by 21 states (Alabama, Georgia)
(c) 3 Mandatory Grounds For NON-Recognition
(i) Due Process (System lacked procedures compatible with the
requirements of due process of law)
(ii) Lack of personal jurisdiction
(iii) Lack of Subject Matter Jurisdiction
(d) 6 Discretionary Grounds for NON-recognition
(i) lacked notice
(ii) Fraud
 (iii) Repugnant to public policy of the state;
(iv) Judgment conflicts with another final and conclusive judgment.
(v) Proceedings was contrary to a forum selection clause, or subject
to arbitration
(vi) Seriously inconvenient forum for trial
(vii) [SOME STATES ADD A RECIPROCITY REQUIREMENT]
1. Florida, Idaho, Maine, Georgia, Massachusetts,
(e) Whether its been codified or not, it is still nice.
iii) The SPEECH Act
(1) Securing the Protection of our Enduring and Established
Constitutional Heritage.
(2) The Act prohibits a federal or state court from recognizing a foreign
defamation judgment UNLESS (1) the court determines either that the
defamation law applied provided at least as much protection for
freedom of speech and press as by the US and by the constitution in
the law of the state in which the court is located OR (2) the party
would have been found liable for defamation by a domestic court
applying federal and state law. 28 U.S.C. 4102(a).
(a) Protected by an equivalent to the first amendment protections OR
(b) Would have been found liable for defamation.
(c) NO RES JUDICATA. You can recover. Effectively put an end to
Libel/Defamation tourism
iv) Full Faith and Credit
v) Durfee v. Duke, 375 U.S. 106 (1963)
(1) Facts. s won a Nebraska case determining that certain land was
indeed in Nebraska and that it belonged to him, after which began a
new action in Missouri, where the U.S. Court of Appeals held that
Nebraska held that the Nebraska Action not to be res judicata on the
issues.
(2) Rule. Judgment is entitled to full faith and credit, including questions
of jurisdictions, when the questions have been fully and fairly litigated
and decided in the court that rendered the original judgment.
(a) This applies to both Subject Matter Jurisdiction AND Personal
Jurisdiction.
(3) NOTE: Think how different it is between a controversy is between
States, and that of a Foreign country (which is REQUIRED to have
SMJ).
(4) Chicot County Drainage District, 208 U.S. 371 (1940)
(a) Rule. The opportunity to raise a jurisdictional issue was held
sufficient to foreclose it later, even though the issue was in fact not
raised.
vi) Fauntleroy v. Lum, 210 U.S. 230 (1908)
(1) Facts. brought suit in Mississippi to enforce a Missouri judgment in
his favor arising out of a contract that was executed and performed in
Mississippi but not enforceable there because of illegality.
(2) Rule. A judgment rendered by a court of competent jurisdiction in one
state is entitled to full faith and credit in another state as long as there
are no errors of law in judgment or the facts that the underlying cause
of action is prohibited in the second state.
(3) THIS IS THE GENERAL RULE, whereas, Thomas is the workers
compensation exception.
(4) Note. This obliterates any public policy exception, for any state with
regard to another state.
vii)Thomas v. Washington Gas Light Co., 448 U.S. 261 (1980)
(1) Facts. Worker based in DC, injured in DC.
(2) Rule. A state has no legitimate interest within the context of our
federal system in preventing another State from granting a
supplemental compensation award when the second State would have
had the power to apply its workmens compensation law in the first
instance.
(3) Rule. This is a workers compensation EXCEPTION, in which a
another state granting supplemental compensation award. (very
limited area)
(4) Policy.
(a) VA/DC both have an interest that an employee that injured is able
to recovered
(b) VA: Liability limits Decisions enforced
(c) VA: Integrity of its determinations
(5) Magnolia Petroleum Co v. Hunt, Respondent was free to pursue his
remedy in either state but, having chosen to seek it in Texas, where
the award was res judicata, the full faith and credit clause precludes
him from again seeking a remedy in LA upon the same ground.
(OVERRULED by Thomas v. Washington)
viii) Baker v General Motors Corp, 522 U.S. 222 (1998)
(1) Facts. Michigan employee Elwell entered into a settlement agreement
with GM, in which he would not testify in products liability cases. He
is subsequently fired, and is enjoined for subsequent testimony,
notwithstanding the current motion.
(2) Issue. Does the injunction in one state apply to all other states?
(3) Rule. Our Full Faith and Credit Clause precedent differentiates the
credit owed to laws (legislative measures and common law) and to
judgments.
 (4) Holding. NO. Michigan has no authority to shield a witness from
another jurisdictions subpoena power in a case involving persons and
causes outside Michigans governance.
(5) Full faith and credit does not mean that States must adopt the
practices of other States regarding the time, manner, and mechanisms
for enforcing judgments. Enforcement measures do not travel with the
sister state judgments as preclusive effects do; such measures remain
subject to the evenhanded control of forum law.
(6) Note cases.
(a) Wamsley v. Nodak Mutual Insurance Co., 178 P.3d 102 (Mont.
2008)
(b) Citing Baker, the state supreme court concluded that ND rulings
were not due full faith and credit because they impermissibly
interfered with the Montana litigation.
(c) It is permissible to refuse recognition of a sister-state judgment if
it would involve an improper interference with important interests
of the sister State. Second Restatement of Conflicts of Law.
(d) Tenas v. Progressive Preferred Ins. Co., 238 P.3d 860 (Nev. 2008)
(e) Supreme Court of Nevada determined it was permissible for a
Nevada court to refuse to recognize a Montana court judgment also
involving the stacking of uninsured motorist benefits.
(f) Even though Montana was the first to file rule, this is no rigid
mechanically/applied rule, but there was a forum dispute, because
the Nevada court thought that Nevada was a better forum for the
dispute.
ix) Union National Bank v. Lamb, 337 U.S. 38 (1949)
(1) ME.. See Previous Notes (on handout)
(2) Sister states MUST be given full faith and credit
x) Treinies v. Sunshine Mining Co., 308 U.S. 66 (1939)
(1) Facts. Petitioner, a claimant of certain stock, sought certiorari review
from the Ninth Circuit Court of Appeals, which affirmed the trial
courts adverse decree that was entered against petitioner in a
proceeding under the Interpleader Act, which was filed by a
complainant stakeholder against, petitioner and respondents, adverse
claimants and citizens of another state.
(a) Probated in Washington (Final decree in 05/1935)
(b) Daughter Katherine Mason sought the Idaho (Decree in 08/1936)
(2) Issue. How to deal with Two conflicting judgements assigning
ownership of the stock (Father by Washington decree, and Daughter in
Idaho decree).
 (3) Rule. LAST IN TIME RULE. Two conflicting state court judgments.
The Court will follow the last judgement rendered, must be given full
faith and credit, because full faith and credit. Based on a rationality of
finality. It has got to be FINAL (Not on appeal).
(a) One trial of an issue is enough. The principles of res judicata apply
to questions of jurisdiction as well as to other issues, as well to
jurisdiction of the subject matter as of the parties.
(b) The power of a second court to examine into the jurisdiction of a
first court is beyond question. Even where the decision against the
validity of the original judgment is erroneous, it is a valid exercise
of the judicial power by the second court.
(4) Holding. Court of Appeals could not be relitigated in the interpleader.
Idaho court determined that Washington judgement was not binding
for lack of jurisdiction.
e) Domestic Relations: A Special Problem of Judgments
i) Estin v. Estin, 334 U.S. 541 (1948), Ex Parte Divisible Divorce
(1) Facts. Husband and Wife married in NY in 1937, separated, and the
wife was awarded $180/month in permanent alimony. The husband
then cased to pay alimony, and the wife sued in NY for arrears.
(2) Issue. NY decree (1943), and NV (1944) divorce decrees, with alimony.
(3) Rule. Because she was not personally served or did not appear in
person, Nevada cannot modify the NY divorce decree.
(a) For Full Faith and Credit, the Domicile of EITHER party, the
divorce is enough to be given full faith and credit. (Williams I).
(b) For Ex Parte Proceedings, when people are moving there just for a
divorce, and have no domiciliary intent, THEN no full faith credit is
required. (Williams II)
(4) Holdings. We held in Williams v. North Carolina that a divorce decree
granted by a State to one of its domiciliaries.
(a) Nevada could not adjudicate the rights of the wife under the NY
judgment when she was not personally served and did not appear
in the divorce proceeding. Since Nevada had no power to adjudicate
the wifes rights in the NY judgment, NY was not required to give
full faith and credit to that phase of Nevadas judgment.
(b) Judgement denying the husbands motion to eliminate alimony was
affirmed.
ii) May v. Anderson, 345 U.S. 528 (1953)
(1) Facts. Marriage and two children in Wisconsin. In Jan 47, she
commences divorce proceedings in Ohio. Nice guy father. They have
been living with them, but goes back.
 (a) Divorce in Wisconsin (valid), where Father was domiciled, and
where the marital domicile is located. Custody?
(2) Issue. What about custody?
(3) Rule. You must have personal jurisdiction to have an enforceable
decree. We recognize that a mothers right to custody of her children is
a personal right entitled to at least as much protection as her right to
alimony. (Valid only if there is P.J.)
(4) Should Custody be treated like property?
(5) Personal Jurisdiction for Property, Custody, Support
(6) DOMICILE for Divorce
(7) Concern about SHAM proceedings.
(a) Concern about Bilateral Divorce
(b) Johnson v. Muelberger, 340 U.S. 581 (1951)
(i) Rule. Bilateral divorce decrees are enforceable and given full
faith and credit, due to the likely role of adversarial role.
iii) Yarborough v. Yarborough, 290 U.S. 202 (1933): Modifications: Child
Custody and Support
(1) Facts. Daughter brought suit against her father, seeking payments for
maintenance and education. Father contended that his obligation to
support the daughter had already been completed because he had
complied with a court support order for the daughter when he divorced
the daughters mother. Lower court rejected this contention and
ordered the father to pay support. Court reversed the decision, finding
that it was clear that the support provisions in the divorce decree were
intended to absolve the father from further obligation to support her.
The Court held that the term permanent alimony as used in the
decree of the Georgia court meant a final provision for the minor child
was shown
(2) Issue.
(3) Rule. Only applies when there is a final, NON-MODIFIABLE support
order, in which case sister states must give
(a) There is a policy reason, why it should be modifiable.
(4) Holding. Court reversed the decision in favor of the daughter and held
that the father did not have any obligation to provide for the daughter.
The Court found that although the daughter was not a party to the
divorce action in which the father was ordered to pay support, under
Georgia law she could not bring her own suit to collect. The Court also
found that full faith and credit should have been given to the previous
judgment.
iv) Parental Kidnapping Prevention Act 28 U.S.C. 1738A
(1) Valid under the jurisdiction of the home state
 (2) UCCJEA-Home state (Childs home state for six months, before the
judgement, OR the child/parent has
(a) There were always gaps/loopholes that existed within the
UCCJA/UCCJEA. Even though they may be modifiable, they
would be given deference to the home state.
(3) Significance. 28 U.S.C. 1738A/B. Gives greater full faith and credit
to custody determination sister the obligations to the custody
determinations. With the meat of the supremacy clause. IF:
(a) Issuing state is the home state or has been the home state within
the last six months preceding the order
(b) No other state will have jurisdiction, and is in the best interests of
the child. That significant connection has to be more than their
physical presence.
(c) Physical presence due to an emergency dealing with abuse.
(d) Continuing jurisdiction
(e) Reasonable notice and valid opportunity to be heard is required
before a child custody and visitation determination is made.
(4) Custody determination:
(a) A court of a State shall not exercise jurisdiction in any proceeding
during the pendency of a proceeding in a court of another State.
(b) A court may not modify a visitation made by a court unless a court
no longer has jurisdiction or has declined to exercise jurisdiction to
modify such determination.
2) Traditional Approaches to Choice of Law
a) Torts
i) Alabama Great Southern Railroad v. Carroll, 11 So. 803 (1892)
(1) Facts. Plaintiff brakeman brought suit against defendant railroad
company for railroad company for damages for a personal injury he
suffered during the course of his employment. The City Court of
Birmingham found for the brakeman and the railroad appealed for the
judgment.
(2) Issue. What law applies? The place of the injury or the place of the
negligence?
(3) Rule. Law is the Place of the Wrong (Negligence). lex loci delicti
(a) In tort law, the law of the place applies to the place of injury.
(b) Uniformity has been equated with fairness to the parties. This
outcome prevents forum shopping, because of uniformity.
(4) Holding. Reversed and remanded.
ii) Selections from the First Restatement of Conflicts, on Wrongs (1934)
(1) Strong territorial bent
(2) Strong interest in vested rights
 (3) GENERAL RULE: Law is the place of the wrong. [lex loci delicti]
(4) EXCEPT:
(a) Poisoning: place of wrong is where it takes effect
(b) Damage to land/chattels: the place of wrong is where the force takes
effect.
(c) Loss by Fraud: Where the loss is sustained (not where fraudulent
representations are made)
(d) Harm to a reputations: Where the defamatory statement is
communicated (and where it is heard).
(5) 382 (Duty or Privilege to Act) Even if required to act or not act, will
not be held liable for the result of such action which occurred in
another state. Moreover, a Person who acts pursuant to a privilege
conferred by the law of the place of acting will not be held liable for the
results of his act in another state.
iii) Bullard v. MRA Holdings, LLC et al., 740 S.E.2d 622 (2013)
(1) Facts. , 14 year old girl from Georgia, exposed her breasts to two
men who filmed her while on spring break in Florida. Defendant
subsequently bought and used this image in a pornographic video
without plaintiffs consent. s claimed that Florida law applies
because the video was shot in Fl.
(2) Rule. The place of the injury, is one of the exceptions where harm is
done to the reputation of a person, the place of wrong is where the
defamatory statement is communicated. First Restatement of
Conflicts 377.
(3) Holding. Court ruled that Georgia law applies because the place of
the wrong is where the injury was sustained.
b) Contracts
i) Selections from the First Restatement of Conflicts, on Contracts
(1) Lex Loci Contractus: The law of the place of contracting applies
generally, except where the place of performance governs, including:
capacity, necessary form, mutual assent, duty for performance, time,
and place, and absolute/conditional character of the promise.
(2) The place of Contracting:
(a) Where the thing happens that makes it a binding contract.
(b) Under the general law, this is the principal event necessary to
make a contract occurs.
(c) AKA, where the Contract, becomes binding. EXCEPT, the where
governed by the place of performance.
(d) Place of Performance, ALSO includes the right to damages and the
extent of damages.
 (3) PROBLEM: An area in which the specific performance locality is NOT
specifically defined. I.e. gratuitous promise to quit smoking.
Prohibitory Contracts.
ii) Poole v. Perkins, 101 S.E. 240 (1919)
(1) Facts. A wife domiciled in TN delivered a promissory note in TN that
was payable in Virginia. Under TN law she had a defense of coverture
to the note because she was married. Under the law of Virginia, she
had capacity and the note was enforceable.
(2) Rule. The doctrine of the common law that the capacity of the parties
to contract with few exceptions determined by the lex loci contractus
that is, the place with reference to which the contract is made, which is
usually the place where it is made, unless it is to be performed in
another place or country.
(a) Raleigh Minor Rule. If by the law of that State no K has been
made, there is no K. (lex celebrationis)
(b) John B Minor Rule.
(i) European rule Place of Domicile.
(ii) It is the lex loci contractus-the law of the place with reference to
the place which the contract is made, UNLESS it is to be
performed in another place or country. (The parties intent)
(3) Holding.
iii) Linn v. Employers Reinsurance Corp., 139 A.2d 638 (1958)
(1) Facts. makes offer to agent, who relays information to , located in
Kansas City. then notifies acceptance of the deal to Agent, who then
calls the acceptance to (located in Pennsylvania).
(2) Issue. Where is the lex loci contractus?
(3) Rules.
(a) When contract is made by telephone, the contract is made where
heard - =- Restatement of Contracts
(b) Where the acceptor speaks. -=- Majority Approach; 326
Restatement of Conflicts
(4) Holding. Reversed and Remanded. Agent was not in NY. Unlike the
NY statute of frauds, the various provisions of the Pennsylvania
statute do not require that an agreement of this sort to be in writing
EVEN IF it is not to be performed within a year.
c) Domicile/Marriage
i) Domicile is Physical Presence and Subjective Intent.
(1) Forums use facts to determine whether intent formed with presence.
(2) Domicile is used for the purposes of establishing jurisdiction. Domicile
is not residence, inhabitance, citizenship.
 (3) Every person has at least one domicile, but no more than one domicile
at a time.
(4) Types of Domicile:
(5) Domicile of Origin. Established at its birth, to both parents, or
domicile of (legitimate) father.
(6) Domicile of Choice. Established through the exercise of his own will,
by physical presence PLUS subjective intent to remain there for some
time.
ii) Restatement of Conflicts on Marriage and Legitimacy
(1) Lex loci celebrationis ; The law of the place that a marriage is
celebrated governs the validity of a marriage. Except when dictated by
statute or contrary to natural law on grounds of incest/polygamy.
iii) Matter of Ranftle, 81 A.D.3d 566 (2011)
(1) Facts. The surviving spouse of a same-sex couple (married in Canada)
was named the executor of the will. Decedents sibling sued, claiming
that the marriage was invalid under New York, at the time, did not
recognize same-sex marriage.
(2) Issue. Can a marriage performed elsewhere be honored in NY?
(3) Rule. Decedents same-sex marriage to respondent was valid under
the laws of Canada, where it was performed, and did not fall into
either of the two exceptions to the marriage recognition rule, as the
marriage was not affirmatively prohibited or proscribed by natural
law.
(a) NYs long-settled marriage recognition rule affords comity to out-of-
state marriages and recognizes a valid marriage considered valid
in the place where it was celebrated.
(4) Holding. Appellants petition to vacate the probate of his brothers
will, unanimously affirmed.
iv) People v. Ezeonu, 588 N.Y.S.2d 116 (1992)
(1) Facts. A Nigerian who was married under Nigerian and New York
law, was prosecuted for statutory rape of a 13-year old girl. Defendant
claimed that, at the time of said rape, the complainant was his second
wife offered to him by her parents. In 1992, Nigerian law allegedly
recognized polygamy and New York law did not recognize rape
between married persons.
(2) Rule. Recognition of a polygamous marriage is repugnant to public
policy. Consequently, a polygamous marriage legally consummated in
a foreign country will be held invalid in New York.
(3) Holding. The court holds that under the stipulated facts the defendant
is not married to the complainant and therefore cannot raise
 marriage as a defense at trial to the charge of rape in the second
degree.
d) Property
i) Summary of Traditional Property Rules
(1) Real Property
(a) Most everythingplace of land
(b) Interpretation when intent determinesdomicile at time of
conveyance/when will made
(2) Personal Property
(a) Mostwhere property is (chattel)
(b) Maritalmarital domicile, at the time of acquisition
(c) At deathwhere died domiciled
(3) Legal
(a) Inter vivos: most everythingwhere property is
(b) At deathwhere died domiciled
(c) EXCEPTION. Intestate in Miss.Miss. Rules govern all property
in MS (91-1-1)
(4) Equitable (trusts) (trustsNOT on exam)
(a) Inter vivos:
(i) Most everythingwhere property is (chattel property) OR where
transaction takes place (choses in action)
(ii) Administrationwhere trust locates administration
(iii) Interpretationwhere domiciled when executed
(b) Testamentary
(i) MostTestators domicile at death
(ii) InterpretationTestators domicile when executed
ii) Burr v. Beckler, 106 N.E. 206 (1914)
(1) Facts. sued to foreclose a deed of trust made by in Florida
conveying real estate to secure a note. Trial court found the deed of
trust and note invalid and entered judgment in favor of . The
appellate court reversed. Supreme court reversed appellate courts
ruling, holding that the record showed the deed of trust and the note
were induced by fraud. Further, the fact that the domicile of was in
Illinois did not enable her to execute a note in the State of Florida
contrary to the laws of that state, under which she was not competent
to enter into a contract. The law of the state of performance governed
in determining the rights of the parties and the effect of the contract,
but because was not competent to make a contract in Florida, the
deed and note were not valid and would not be enforced anywhere.
(2) Rule. Contract conflicts rules trump land conveyance issues, because
the contract was required for the conveyance.
 (3) The law is governed by the place of the land is located.
(4) If the obligation for security is void, then the security is void. (Illinois,
talks about the first restatement, when it was through the mail. The
K is invalid)
(5) (1) We look at the law where the land is located
(6) (2) We then look at Illinois land law.
(7) (3) Since Illinois land law also has,
(8) Holding. The application of the rules of law, leads to the conclusion
that the note was void (due to coverture laws in Florida).
iii) Thomas v. Kyle, 23 So.12 (1897)
(1) Rule. It is, therefore, almost universally held that so far as real estate
or immovable property is concerned, we must look to the laws of the
state where it is situated for the rules which govern its descent,
alienation, and transfer, and for the construction, validity, and effect of
conveyances thereof; and it is to the same law that we must look for
the rules governing the capacity of the parties to such contracts or
conveyances, and their rights under the same.
iv) Blackwell v. Lurie, 71 P.3d 509 (2003)
(1) Facts. Husband was a general partner in a Missouri law firm that filed
bankruptcy, and the trustee obtained a deficiency judgment. Appellees
acquired a sketch jointly in Missouri, and while domiciled in Missouri,
placed the sketch on consignment at a gallery in New Mexico.
Appellees then relocated to Montana, their present domicile. The
trustee filed a write of execution in New Mexico, and appellees moved
to quash the petition, arguing that hey owned the sketch as tenants by
the entirety, such that it was exempt from execution in satisfaction of
the deficiency judgment. The appellate court ruled that, pursuant to
conflict of laws rules, Missouri law governed the characterization of the
property at issue, and that appellees held that sketch as tenants by the
entirety. Based on the time-and-manner-of-acquisition rule, the sketch
was held by appellees as tenants by the entirety. In conformity with
the general rule by which tenancy by the entirety property was deemed
exempt from all but joint creditors, the sketch was not subject to the
claims of the trustee. Also, because the deficiency judgment was the
separate debt of the husband, the petition for writ of execution was
properly quashed.
(2) Rule.
v) Morson v. Second National Bank of Boston, 29 N.E.2d 19 (1940)
(1) Facts. The husband and wife were travelling in Italy. The husband
gave the wife an envelope containing a certificate for 150 shares of
stock in the corporation, which was incorporated in Massachusetts.
 The husband signed the certificate and gave it to the wife. The wife
then delivered the certificate to the bank. The husband died and the
wife alleged that the certificate was hers based upon the husband's
gift. The estate initiated an action for injunctive relief against the
corporation, bank, and the wife to enjoin the transfer of the stock and
for recovery of the certificate. The trial court entered judgment for the
estate, finding that there was no completed gift of stock. On appeal,
the court reversed the decision and dismissed the action. The court
found that the transfer was improperly judged by the laws of Italy. The
court held that shares of stock were subject to the jurisdiction of the
state of incorporation and the husband's action were sufficient in
Massachusetts to effect legal transfer of the shares.
(2) Issue. Whether or not there is a completed gift of an ordinary tangible
chattel is determined by the situs of the chattel.
(3) Rule. Shares of stock, are not ordinary tangible chattels. A distinction
has been taken between shares and the certificate, regarded as a piece
of paper. Shares created in a state which has adopted the Uniform
Stock Transfer Act with its provision that title to a share can be
transferred only by delivery of the certificate may be transferred by
delivery of the certificate as provided by the Act even though such
delivery takes place in another state where such Act is not in force.
e) Agency, Partnership, and Corporations
i) Under traditional choice of law rules, the rights of principals, agents, and
partners among themselves are governed by the contract principles of the
place of the contract.
ii) Whether a corporation exists and its internal affairs are governed by the
law of the place of incorporation. [Internal Affairs Rule]
iii) The liability of a principal, partner, or corporation to someone else who is
NOT part of the partnership, agency, or internal corporate relationship is
governed by the place of the conduct.
iv) Agents in behalf of the Corporation
(1) Directors are NOT agents, like officers, but they are fiduciaries
f) Wrinkles in the Law
i) Haumschild v. Continental Casualty Co.
(1) Facts. Mr. and Mrs. Haumschild (domiciled in Wisconsin) were
traveling in California and involved in an accident. Ultimately, Mrs.
Haumschild sued her husband for personal injuries she suffered in an
automobile accident in California as a result of his negligence. Both
parties were Wisconsin domiciliaries. The Wisconsin trial court
dismissed the case under Californias law prohibiting a wife from suing
her husband in tort. Wife Appealed to Wisconsin.
(2) Issue. Which conflict of laws approach controls with respect to inter-
spousal liability for tort growing out of an automobile accident. (State
of the forum, state of the place of wrong, or the state of domicile)
(3) Rule. We apply the law of the family domicile, over the law of the
place of injury (which may be fortuitous/irrelevant).
(4) Rationale. In Buckeye v. Buckeye, Wisconsin was the forum state and
the state of domicile, while Illinois was the place of injury. There is
was held that the creation and extent of tort liability is that of the
place where tort was committed. And further that interspousal
immunity from tort liability is governed by the law of the place of
injury. This rule was adopted by the First Restatement of Conflicts of
Flaws, but it was widely criticized by California, New Jersey, and
Pennsylvania.
(5) In Emery v. Emery, two unemancipated sisters sued their
unemancipated minor brother and father for injuries. The forum state
and state of domicile was Idaho while the state of injury was
California. However, in that case, the question of immunity was
couched in termsnot of tortbut of whether one had capacity to sue
and be sued, and rejected the place of injury as both fortuitous and
irrelevant. Therefore, In Emery, they applied the family domicile,
based on strong public policy reasons, thinking it was undesirable
that the rights, duties, disabilities, and immunities conferred and
imposed by family relationship should change as family member cross
state boundaries during temporary abscences from their homes.
(6) Returning to Haumschild, the court specifically overrules Buckeye on
public policy grounds (preventing family discord), noting that this is a
narrow ground, and should not be interpreted as a rejected of the
general rule that the substantive rights of a tort are determined by the
place of the wrong.
(7) The Concurring Opinion, the Justice agrees in judgment, but levies a
quill full of arguments based primarily on (1) Domicile is not easy, yet
henceforth courts will be required to determine it in many cases where
it has heretofore been considered immaterial.
(8) The First Restatements ultimate goal of uniformity is undermined by
its rigidity and silence on the issue of lawsuit characterization. (Tort
Claims can be reconfigured as Contract Claims Breaches of implied
promises or Quasi-contract claims for restitution.) (Contract claims
can sometimes be reconfigured as tort-like breaches of duties of good
faith and fair dealing. Equitable principles could aruge a trust-like
relationship has formed and given rise to fiduciary duties and a
constructive trust. If an attempted trust fails under the law of the
 place of the settlement, then a creative lawyer will argue that the
property now in the hands of the designated trustee is held in a
resulting trust to be governed by law where property is now located.
(9) Still other legal claims are hard to classify. Product liability claims by
be breaches of warranty (K theory) or strict liability for dangerous
products (tort theory).
ii) In re Estate of Damato, 206 A.2d 171 (1965)
(1) Facts. NJ was the forum and state of domicile. Florida had the assets
and governing law.
(2) Rule.
(3) Renvoi. Except for cases involving title to land or validity of a divorce
decree, the First Restatement generally rejected the renvoi doctrine.
Renvoi is the inclusion of choice-of-law rules within the law of a choice-
of-law rule.
(4) When there is a difference in the Conflict of Laws of two states whose
laws are involved in a problem, the rule of Conflict of Laws of the
forum is applied: (a) in all cases where as a preliminary to determining
the choice of law it is necessary to determine the quality and character
of legal ideas, these are determined by the forum according to its law;
(b) where in making the choice of law to govern a certain situation the
law of another state is to be applied, the foreign law to be applied is the
law applicable to the matter in hand and NOT the Conflict of Laws of
the foreign state.
iii) Substance v. Procedure
(1) The law of the forum. Forums laws are followed for whether
substantive or procedural.
iv) Sampson v. Channell 110 F.2d (1st Cir)
(1) Facts. A car driven by testator collided in Maine with a car occupied by
victims, injuring them. Inter alia, a victim filed an action in the federal
trial court in Massachusetts. The jury found that the victim's injury
was caused by the negligence of the testator, but also found for the
testator on the issue of contributory negligence. The trial court entered
judgment for the executor. On appeal, the court held that for error in
the instructions given to the jury on the burden of proof, the judgment
was to be reversed and the cause remanded for further proceedings.
The court's theory was that the federal court in Massachusetts sat as a
court coordinate with the Massachusetts state courts to apply the
Massachusetts law in diversity of citizenship cases. The court held that
it was difficult to see that gain in the direction of uniformity would
have been achieved by creating a discrepancy between the rules of law
applicable in the Massachusetts state and federal courts, respectively,
 in order to bring the law of the Massachusetts federal court in
harmony with the law that would be applied in the state courts of
Maine.
(2) Rule. The contributory negligence is substantive for the question of
Erie, because it is outcome-determinative. But, it is procedural for the
question of Conflicts of Law, because we apply the law of the forum
state.
g) Statutes of Limitations
i) Selections from First Restatement of Conflicts on Statutes of Limitations
(1) 603 Statute of Limitations of Forum: If action is barred by the
forum, no action can be maintained where the cause of action arose.
(2) 604 Foreign Statute of Limitations: If action is NOT barred, an
action can be maintained where the action arose.
(3) 605 Time Limitations on Cause of Action: If the law of the state
created the right of action shall expire, no action can be maintained in
any state.
(4) BROAD/GENERAL RULE. Forum Statutes of limitations
automatically apply in the absence of a borrowing statute.
(5) Rule. Statutes of limitations will be presumed to be procedural unless
they are contained in the same statute that creates the substantive
right. [Applied in Land Rights: This is Adverse Possessions.]**
(6) Rule. Statutes of Repose are likely to be treated as substantive, at
least if they are deemed substantive by the states adopting them. [
(7) Uniform Conflict of Laws Limitations 3 (1982) If the statute of
limitations of another state applies to the assertion of a claim in this
State, the other states relevant statutes and other rules of law
governing tolling and accrual apply in computing the limitations
period, but its statutes and other rules governing conflict of laws do not
apply. [Workers Compensation Statutes?*] Statutory creation of New
Causes of Actions.
(8) Rule. MS Code. Ann. 15-1-65 Action Barred in Another Jurisdiction
Barred Here. MS Borrowing for Statute s of Limitations When a cause
of action has accrued outside this state, and by the laws of the place
outside this state where such cause of action accrued, an action
thereon cannot be maintained by reason of lapse of time, then no cause
of action has accrued in favor of a resident of this state, this states law
on the period of limitations shall apply.
(a) When Does this Apply?
(i) Cause of Action has Accrued in Another State
(ii) Now Barred in that State
(b) THEN, this states law on the period of limitation shall apply.
 (c) Note: MS Borrowing Statute does not apply to MS residents
(d) Note: There are very often specific Will-Borrowing Statutes (Except
in Mississippi-No Will Borrowing Statute in Mississippi).
h) Public Policy
i) 612. Action Contrary to Public Policy. No action can be maintained
upon a cause of action which is contrary to the strong public policy of the
forum.
ii) Laboratory Corp. of America v. Hood, 911 A.2d 841 (2006)
(1) Facts. Parents brought suit against Labcorp, alleging that its
erroneous report stating that their fetus did not have cystic fibrosis
contributed to their decision to have a child.
(2) Issue. Does denying Maryland residents the right to bring a wrongful
birth action by applying North Carolina la violate the public policy of
the State of Maryland. [Maryland recognizes an action/North Carolina
Does not.]
(3) Rule. Maryland courts have not previously applied a public policy
exception to the lex loci delicti doctrine, although Maryland case law
strongly indicates that courts would do so in a proper case. Maryland
courts have long recognized, and have on occasion applied, such an
exception under analogous lex loci principles and have implicitly
recognized the exception in a tort action subject to lex loci delicti.
(4) Holding. We reject the and adopted instead that the harm is not the
birth itself but the effect of the defendants negligence on the parents
resulting from the denial to the parents of their rights, as the case may
be, to decide whether to bear a child with a genetic defect.
(a) That right is a matter of important public policy in this State,
flowing not only from this Courts considered view but as well from
the statute. Maryland Code 20-209(b) of the Health General
Article precludes the State from interfering with the decision of a
woman to terminate her pregnancy at the time during the
pregnancy.
(5) Rationale. We conclude that if application of North Carolina law
would preclude this cause of action on the ground stated in Azzolino
that no injury has occurred, we important Maryland public policy.
iii) Classic Definition of Public Policy (J. Cardozo)
(1) The courts are not free to refuse to enforce a foreign right at the
pleasure of the judges, to suit the individual notion of expediency or
fairness. They do not close the doors unless help [to the other state]
would violate some fundamental principle of justice, some prevalent
conception of good morals, some deep-rooted tradition of the common
weal.
 iv) Holzer v. Deutsche Reichsbahn-Gesellschaft, 14 N.E.2d 798 (1938)
(1) Facts. The corporation was a German corporation and the employee
was a German national. The parties entered into an employment
contract for services to be performed in Germany and other locations
outside New York. The employee's causes of action alleged that the
employment contract provided that in the event that he "became
unable," without fault on his part, to serve during the period of the
contract the corporation would pay to him the sum of 120,000 marks,
in discharge of their obligations. The first cause of action alleged that
the corporation discharged the employee on the sole ground that he
was Jewish. The second cause alleged that, due to incarceration in a
concentration camp, the employee was unable to continue his
employment.
(2) Issue.
(3) Rule. It cannot be against the public policy of this State to hold
nationals to the contracts which they have made in their own contrary
to be performed according to the laws of the country.
(a) NOTE. 612, the rule applies only cause of action created in
another state. Is his cause of action contrary to public policy?
The DEFENSE is contrary to public opinion. If it is a Defense,
there is not public policy.
(b) Public policy exception applies only to CAUSES of ACTION that is
contrary to strong public policy.
(4) Holding. In the employee's breach of contract action, the court
modified the order by reversing so much thereof as granted the
employee's motion to strike out the corporation's defense that the
corporation was required by German law to discharge the employee
because he was Jewish. The court affirmed the order granting the
employee's motion to strike the corporation's defense to the employee's
claim that he had become unable to perform.
i) Proof of Foreign Law
i) General
(1) Foreign Law
(a) Old = Fact
(b) New = Matter of Law Fed. R. Civ. P. Rule 41
(i) Noted in Pleadings, as defense/complaint
(ii) Court may consider any relevant material
(iii) Court may take notice and decide based upon the laws of
another decision.
(iv) For Common Law law, there is a presumption that it is
identical.
 ii) Tidewater Oil Co. v. Waller, 302 F.2d 638 (10th Cir. 1962)
(1) Facts. The employee was working in Turkey when he was injured. The
employee alleged that his injuries were caused by the employer's
negligence and that his right to recover had to be determined by the
laws of Turkey. The employer argued that any right of action was
exclusively cognizable under either the workmen's compensation law of
Turkey, or Oklahoma, and in either event, the employer was
exclusively liable for workmen's compensation benefits and that the
court was without jurisdiction. The trial court found in favor of the
employee.
(2) Issue. May the Plaintiff, having elected to pursue his remedy under the
law of Turkey, where the injury occurred, may maintain this suit
under and by virtue of such laws.
(3) Rule. In the absence of proof of applicable foreign law, courts of the
forum have rather unevenly followed three alternatively courses:
1. Dismissed the claim for failure to make out a prima facie
case;
2. Conveniently applied the law of the forum; and
3. Indulged in certain presumptions as to the foreign law and
applied it accordingly.
(4) Rule. In the absence of pleading and proof of applicable law of sister
state, it will apply its own law, both general and statutory, on the
convenient assumption that the law of the sister state is the same as
its own.
(5) Holding. The court affirmed the decision in favor of the employee,
holding that (1) it could be presumed that Turkey recognized the legal
duty of one to exercise due care not to injure another; (2) 4 of the
Oklahoma Workmen's Compensation Act, which granted the election
to claim extraterritorial benefits, specifically provided that such right
of election did not preclude an injured employee from pursuing his
remedy under the laws of the state where the injury occurred; and (3)
having accorded the right of election, the doors of the courts should not
be closed to the assertion of the remedy, even though it would have
been unavailable if the injury had occurred in the state.
(6) Summary of Law Digests (MartinDale): 20-30page summary
(7) Miss. R. App. P. 20. The following court can certify questions to the
Mississippi Supreme Court: United States Supreme Court, United
States Fed Circuit Courts. Federal Appellate Courts can certify
questions of law, when there is not a clear, controlling precedent of
law.
3) New York Approach
a) Problems with the First Restatement
i) Never really restated rules that were adopted everywhere (i.e. contracts,
torts, escape hatches). Inconsistencies existed despite the goal of
uniformity.
ii) Even though, the procedural issues were govern by the forum, so a lot of
outcome-determinative things are governed by the forum (Caps on
damages, parole-evidence rule, which were all disparately considered as
procedural)
iii) Public-Policy Exception, even though its the place allows a head-on
collision, expanding it to apply to defenses.
iv) First Restatement, NEVER, achieved the dream of uniformity.
b) Most States, have moved away from the First Restatement. New York is one
of the first.
c) Auten v. Auten
i) Facts. English couple married in England, gets an ex parte divorce in
Mexico. (invalid divorce). Wife agrees not to challenge, provided that he
would agree to a support agreement. He gets a judgment against him in
England. Conflict in English (enforceable agreement) law and NY law.
Court applies English law (anyhow), based on the performance
obligation, but its better to apply NY law
ii) Rule. Law of the place with the most significant contacts to resolve the
matter.
d) Haag v. Barnes
i) Facts. Secretary gets pregnant in NY, but moves to Illinois and agrees to
settlement Contract, birth occurs in llinois. Mother and child return to
NY and litigate there. Choice of law provision says IL law applies. Note:
Illinois say this contract needed court approval.
ii) Rule. Most Illinois contacts, and choice of law provision. (Grouping of
contracts.
iii) Problem. Why are these significant contacts more important than others.
e) Babcock v. Jackson, 12 N.Y.2d 473 (1973)
i) Facts. Plantiff, defendant, and defendantss wife (all residents of NY)
went to trip in Canada. Defendant lost control of the car, and injured
others. Ontario statute immunized drivers from liability, but NY drivers
could be held liable for gross negligence.
ii) Rule. Apply the NY law.
iii) Importance. For most courts that move away from the First
Restatements territorial approach, this puts a food in the door.
iv) Holding. Court rejected strict application of the place-of-injury rule for all
issues that arise in tort cases.
f) Tooker v. Lopez, 24 N.Y.2d 569 (1969)
 i) Facts. and were domiciled. Car was registered and insured in NY.
College students were involved in accident. Michigans guest statute
barred recovery except in cases of willful misconduct or gross negligence of
driver.
ii) Rule. NY law applies.
iii) Holding. NY has the only real interest in whether recovery should be
granted and the application of Michigan law would defeat a legitimate
interest of the forum state without serving a legitimate interest of any
other state New Yorks grave concern in affording recovery for the
injuries suffered is evident merely in stating the policy which our law
reflects.
iv) Focused on legislative history of
g) Neumeier v. Kuehner, 286 N.E.2d 454 (N.Y. 1972)
i) Facts. Arthur Kuehner, the defendant's intestate, a resident of Buffalo,
drove his automobile from that city to Fort Erie in the Province of
Ontario, Canada, where he picked up Amie Neumeier, who lived in that
town with his wife and their children. Their trip was to take them to Long
Beach, also in Ontario, and back again to Neumeier's home in Fort Erie.
However, at a railroad crossing in the Town of Sherkston -- on the way to
Long Beach -- the auto was struck by a train of the defendant Canadian
National Railway Company. Both Kuehner and his guest-passenger were
instantly killed.
ii) Neumeier's wife and administratrix, a citizen of Canada and a domiciliary
of Ontario, commenced this wrongful death action in New York against
both Kuehner's estate and the Canadian National Railway Company. The
defendant estate pleaded, as an affirmative defense, the Ontario guest
statute and the defendant railway also interposed defenses in reliance
upon it. In substance, the statute provides that the owner or driver of a
motor vehicle is not liable for damages resulting from injury to, or the
death of, a guest-passenger unless he was guilty of gross negligence.
iii) Rejected mechanical place of injury rule in personal injury cases (Babcock)
because it failed to take account of underlying policy considerations, and
were willing to sacrifice the certainty of the old rule with a more just, fair
and practical result by giving controlling effect to the law of the
jurisdiction with the greatest concern to the litigation.
h) Schultz v. Boy Scouts of America, 65 N.Y.2d 189 (1985)
i) Facts. Plaintiffs, parents and administrators of estate, filed a complaint
against defendant charities for injuries to themselves and their sons
following their sons' sexual molestation by defendants' employee.
Plaintiffs and defendants were domiciled in New Jersey, but some of the
molestation occurred in New York. The lower court granted defendants'
 motions for summary judgment and the appellate court affirmed. The
court affirmed, holding that interest analysis had become the relevant
analytical approach to choice of law in tort actions in New York and the
law of the jurisdiction having the greatest interest in the litigation would
have been applied and the only facts or contacts which obtain significance
in defining state interests were those which related to the purpose of the
particular law in conflict. Under this formulation, the significant contacts
were, almost exclusively, the parties' domiciles and the locus of the tort,
thus the law of New Jersey had to be applied. The court held that the
issue presented was barred by the New Jersey charitable immunity
statute and had been actually litigated and determined by a final
judgment of its courts.
ii) Rule. This is a reverse Babcock case, because New York is the place of
the tort, rather than the jurisdiction of the parties common domicile.
(1) When parties are domiciled in the same state, apply law of the parties
common domicile.
(2) Apply law of the place of accident UNLESS displacing that normal
rule will advance the relevant substantive law purpose without
disrupting the smooth working of the interstate system or produce
great uncertainty.
iii) Holding. The court affirmed the order and held that plaintiffs, parents
and administrators of estate, could not bring a cause of action against
defendant charities because conflicts of laws required applying New
Jersey law, and plaintiffs' claims against defendants were barred by the
New Jersey charitable immunity statute, and had been litigated and
determined by a final judgment of its courts.
i) Padula v. Lilarn Properties Corp., 644 N.E.2d 1001 (1994)
i) Facts. The subcontractor sustained injuries when he fell from a scaffold
while performing work on the owner's property. Both parties were New
York residents; however, the injuries occurred in Massachusetts. The
subcontractor filed an action for damages, alleging violations of N.Y. Lab.
Law 200, 240(1), 241(6) and the rules and regulations thereunder. The
owner's motion for partial summary judgment dismissing the
subcontractor's causes of action was granted by trial court and affirmed by
the appellate court. The issue on further appeal was whether the
provisions of New York State Labor Laws were applicable to the action.
The court held that, while N.Y. Lab. Law 240(1), 241(6) embodied both
conduct-regulating and loss-allocating functions, they were primarily
conduct-regulating rules requiring that adequate safety measures be
instituted at the worksite and should not have been applied to the
resolution of the tort dispute, which arose in Massachusetts. In affirming
 the dismissal, the court concluded that the law of Massachusetts, the
jurisdiction where the tort occurred, applied because the laws at issue
were conduct-regulating.
ii) Rule. Apply the law of the place of injury UNLESS the issue involves a
loss-allocation dispute between common domiciliaries, in which case apply
the law of the domicile.
(1) The New York revolution amounts to nothing more than First
Restatement with a narrow exception for common domicile cases
involving loss-allocation issues.
iii) Holding. The court affirmed the appellate court's judgment dismissing the
subcontractor's claims.
j) New York Approach
i) In New York, is this conduct-regulating? If so, then apply the law of the
place of the harm. If it is loss-shifting, then apply common domicile.
(1) Perhaps (charitable immunity) is primarily/principally conduct
regulating?
(2) Conduct-regulating
(a) Labor law/ Workplace Safety
(b) Rules of the Road
(c) Standards of Care
(d) Hotel Safety Standards
(3) Loss Shifting
(a) Guest Statutes
(b) Charitable Immunities
(c) Vicarious Liability Statutes
(d) Wrongful Death Statutes
(e) Contribution and Indemnification of Liability
ii) Conduct-Regulating
(1) Lex loci delicti
iii) Loss allocating
(1) Common domicile
(2) Place of tort Unless
4) INTEREST-ANALYSIS (3 States)
a) Introduction
i) True-Conflicts
(1) Each Jurisdiction has an interest in the application of its law to the
dispute. In such cases, each jurisdiction has a policy that would be
promoted by applying its law.
(2) Forum law should always govern true conflicts.
ii) False-Conflicts
 (1) Only one jurisdiction has an interest in the application of its law. In
such cases, the laws of states conflict, but he governmental policy
behind one of the laws of states conflict, BUT the govt policy behind
one of the laws will not be advanced by the application of the law.
(2) Apply the law of the Only state that has an interest in the application
of its law.
(a) Babcock, Tooker are generally conceded to be false conflicts because
only one state had an interest.
iii) Unprovided-For Cases
(1) No state has an interest in applying its law.
(2) Default rule, forum law would apply.
b) Lilienthal v. Kaufman, 395 P.2d 543 (1964) [TRUE CONFLICT]
i) Facts. Plaintiff brought an action against defendant to collect on two
promissory notes. Defendant argued that he had previously been declared
a spendthrift by an Oregon court and placed under a guardianship. The
guardian declared that the obligations under the notes were void. The
plaintiff contended that the notes were executed and delivered in
California, which did not recognize the disability of a spendthrift, and that
the Oregon court was bound to apply the law of the location where the
contract was made. The trial court rejected plaintiff's argument and held
for defendant. The appeals court affirmed, holding that the law of the
place of the making of the contract would usually apply unless the forum
state had a strong public policy interest in applying its own laws. The
court concluded that Oregon had a strong public policy interest in
applying its laws protecting spendthrifts from liability.
ii) Rule. Due to conflicts, they apply the forum law because each state
(Oregon & California) have interests, and this is a true conflict.
(1) We have two jurisdictions each with several close connections with the
transactions, and each with a substantial interest, which will be served
or thwarted, depending upon which law is applied. The interests of
neither jurisdiction are clearly more important than those of the
other.
iii) Holding. The court affirmed the judgment for defendant, holding that
Oregon law applied and defendant, having been declared a spendthrift,
was not liable as maker of two promissory notes.
c) Bernkrant v. Fowler, 55 Cal.2d 588 (1961) [FALSE CONFLICT]
i) Facts. The buyers purchased an apartment complex in Nevada. By
agreement of the parties, the buyers refinanced their obligations and paid
a substantial part of their indebtedness to the seller in exchange for the
seller's promise that he would provide in his will that upon his death all
their indebtedness to him would be canceled. When the seller died in
 California, he did not provide for the cancellation of the buyers' balance
and the buyers continued to make regular payments under protest. The
buyers brought an action against the executrix to have the note cancelled
and the property reconveyed to them. The trial court entered judgment in
favor of the executrix. On appeal, the court reversed the judgment,
reasoning the laws of Nevada applied and that the lower court improperly
determined that the parties' contract was subject to the California statute
of frauds.
ii) Rule.
(1) Under California Statue of Frauds, the Contract would NOT be valid.
(2) Under Nevada law, the Contract would be valid.
(3) Just as parties to local transactions cannot be expected to take
cognizance of the law of other jurisdictions, they cannot be expected to
anticipate a change in the local statute of frauds. Protection of rights
growing out of valid contracts precludes interpreting the general
language of the statute of frauds to destroy such rights whether the
possible applicability of the statute arises from the movement of one or
more of the parties across state lines or subsequent enactment of the
statute
(4) Apply the law of the only state that has an interest in the application
of its law.
iii) Holding. The court reversed the judgment of the trial court. Protection of
the buyers' rights under a valid contract precluded interpreting the
general language of the statute of frauds to destroy such rights despite
possible applicability of the statute arising from the movement of one or
more of the parties across state lines.
iv) Agreement was good. There was an apparent/False Conflict. Nevada has
the only conflict. California has no interest.
d) Hurtado v. Superior Court, 11 522 P.2d 666 (1974) [Unprovided-for Cases]
i) Facts. In a wrongful death action that involved a Mexican decedent,
defendant driver and plaintiff beneficiaries sought a writ of mandate to
vacate a ruling of respondent Superior Court of Sacramento County
(California). The ruling applied California law pursuant to Cal. R. Ct. 232
and not Mexican law to the action. The lower appellate court granted an
alternative writ and issued a peremptory writ of mandate. The
beneficiaries appealed.
(1) Plaintiff is Mexican resident. Defendant are residents of California.
(This appears to be loss-shifting; Under New York approach, apply law
of common domicile, o UNLESS doing so would displace substantive
multi-state policyJust a Review.)
 ii) Rule. Mexico has no interest whatsoever in the application of its
limitation of damages rule to the instant case. California (as the forum)
has an interest in in providing for damages for wrongful death.
(1) California has two separate interests
(a) First, the state interest in creating a cause of action for wrongful
death so as to provide some recovery; and
(b) Second, the state interest in limiting the amount of that recovery.
iii) Rationale. The trial court stated that under Cal. R. Ct. 232 it would apply
the law of California with unlimited damages and not Mexican law, which
limited damages to an accident in California with resident defendants in
the lawsuit. The lower appellate court granted a writ of mandate to
preclude the trial of the lawsuit under California law. In discharging the
lower appellate court's writ of mandate, the court held that the superior
court was correct in applying California law to the action. The court stated
that the proper test, the governmental interest approach, required an
analysis of the respective interests of the states involved, the objective of
which was to determine the law that most appropriately applied to the
issue involved. The court found that in wrongful death actions, there were
completely independent state interests that created a cause of action to
provide some recovery and deter conduct and limited the amount of that
recovery to avoid the imposition of excessive financial burdens on
defendants. However, a state would not have an overriding interest in
denying its own residents unlimited recovery against nonresidents in
another state.
iv) Holding. The court discharged the alternative writ of mandate granted by
the court of appeal and denied defendant driver's petition for a
peremptory writ because the trial court, both as the forum, and as an
interested state, correctly looked to its own law. Mexico had no interest in
applying its limitation of damages in wrongful death actions to
nonresident defendants or in denying full recovery to its resident
plaintiffs.
e) Valid Criticisms
i) Home State Protectionisms, that seems at odds with applying the equally
to people.
ii) Difficulty in Identifying the Interests
iii) Pro-Forum Bias
5) Comparative Impairment
a) Rules
i) True Conflicts: Apply the law of the state whose interest is more seriously
impaired, if its law were not applied in the particular context presented by
the case.
 ii) False Conflict/Unprovided-For Cases: Apply forum law.
iii) Adopted by: California and Louisiana
iv) Objective: Game Theory: Non-Zero-Sum Game
b) Bernhard v. Harrahs Club, 546 P.2d 719 (1976)
i) Facts. Plaintiff was injured by a drunk driver who became intoxicated at
defendant's tavern. The court found California's law regarding liability for
selling alcohol to an intoxicated person should be applied to defendant
because California had a legitimate concern in the protection of its
citizens to warrant applying its law in controversies where two separate
states were involved with conflicting laws. The court held that it was
proper that California's law be applied to defendant who advertised and
solicited California residents to come to his establishment for the purpose
of drinking and gambling and with the knowledge that they could become
intoxicated and would then use the public highways to go home.
(1) California imposes civil and criminal liability for tavern keepers.
(2) Nevada imposes only criminal liability for tavern keepers (judicial
restraint/civil liability should be imposed by legislature).
(3) True Conflict situation (apply Comparative Impairment)
ii) Rule. Solicitation of business in California, brings the Nevada tavern
keepers into the heart of California business law.
iii) Outcome. The court held that it was proper to assume that defendant be
held to the laws of the state when he intentionally solicited business from
the citizens of the state.
c) Kearney v. Salomon Smith Barney, Inc. (SSB), 137 P.3d 914 (2006)
i) Facts. The complaint alleged that the company had a continuing practice
of recording telephone conversations made to a branch office in Georgia
without the callers' knowledge or consent. The clients, who resided in
California, sought injunctive relief and monetary damages or restitution.
ii) Rule. True Conflict here, Apply Comparative Impairment.
(1) California interests would be significantly impaired if its laws were not
applied in this context
(2) Georgias interests would not be significantly impaired if California
law rather than Georgia law were applied.
iii) Holding. The court found a true conflict between California and Georgia
law. Under a comparative impairment analysis, the court determined that
California had a strong and continuing interest in protecting the privacy
of its residents, and that the application of California law would not
severely impair Georgia's interests, because a Georgia company that had a
valid business justification for recording telephone calls could comply with
California law by disclosing at the outset of a call made to or received from
a California customer that the call was being recorded. Georgia did,
 however, have a legitimate interest in protecting its companies from
unexpected liability based on past actions that were lawful in Georgia.
d) The Better Rule Approach
i) Leflars goals: (1) Shunned general theories and didnt formulate a set of
rule, but emphasized a flexible approach consistent to actual judicial
practice; and (2) Paid attention to the impact of the content of the laws in
conflict and on the outcome of the judicial choice of law analysis.
ii) Major Choice-Influencing Considerations
(a) Predictability of Results
(i) Uniformity of Results has always been the major goal in choice-
of-law theory.
(ii) Especially important for contracts, property transfers, and other
planning situations where parties need to know what law
governs.
(b) Maintenance of Interstate and International Order
(i) There must be a minimum of mutual interference with claims or
aspirations to sovereignty. No forum whose concern is
negligible should claim priority over the law of a state which has
clearly superior concern with the facts. Thus, the Better Rule
Approach should apply only to True Conflicts.
(c) Simplification of Judicial Task
(i) Ease of judicial performance is not ordinarily of principal
concern governing choice-influencing considerations but, it is
important to some choices.
(d) Advancement of the Forums Governmental Interests
(i) A states total governmental interest in a case is to be discovered
from considerations that properly motivate the state in its law-
making and law-administering tasks
(ii) Note, Unlike interest analysis, a forums interests are not
necessarily expressed by law of the forum, and may be advanced
by some other law, such as when the law is old or out of tune
with the times.
(e) Application of the Better Rule of Law
(i) A states governmental interest in a set of facts can be
analyzed only be reference to the content of the competing rules
of law.
(ii) The laws legitimate concerns with justice in the individual
case, sometime spoken as choice-of-law objective, and with
protection of justified expectations of the parties corresponds
to basic rules of validation.
(iii) It is preferred law, not preferred parties.
 (iv) Hypothetically, the Better Rule factor should be applied
only be applied when other factors are not dispositive.
iii) Major Criticisms: (1) Of the five considerations Leflar neither assigned
relative value nor provided guidance on how to reconcile conflicts among
them. (2) It may not be so easy to determine what law is better. (3)
Applying a law, even if it is better, may not be appropriate step. (3) Many
states refuse to state which law is better.
iv) Jurisdiction: Followed by three states (not including Minnesota).
Arkansas, New Hampshire, Rhode Island, and Wisconsin use some form of
the better-law approach for torts.
e) Milkovich v. Saari, 203 N.W.2d 408 (1973)
i) Facts. An Ontario driver injured an Ontario passenger in Minnesota. -
Milkovich was injured when -Saari (driver) and -Rudd were taking a
day trip from their homes in Ontario, Canada to Duluth, MN. Ontario
has a guest statute, requiring Plaintiff to establish gross negligence in
order to recover against defendants. Minnesota has no guest statute. s
car was garaged, registered, and insured in Ontario.
ii) Issue. What law applies? What legal theory?
iii) Rule. MN adopts the Better Rule relying on Clark v Clark and Schneider
v. Nichols (True Conflicts), but applies the Better Rule to a False Conflict,
something Leflar never advocated for. Note: Minnesota, like Wisconsin,
adopted not a rule, but a method of analysis that permits dissection of a
bundle constituting a tort and the environment to consider the reasonable
choice of law.
iv) Holding. Plaintiff should be allowed to proceed with her action under
common law rules of negligence and is not bound by the guest statute
requirements of the Province of Ontario. [Note: Reaches Opposite Result
to other Modern Approaches]
v) Application of the Rule.
(1) Predictability can be overlooked since this test relates to consensual
transactions, cannot apply to accidents.
(2) Apply the law of not state which does not have substantial connection
with the particular facts at issue.
(3) Simplification of the judicial task poses no problem, since courts are
fully capable of administering the law of another forum if called upon
to do so.
(4) There is adequate support for the governmental interest, based on the
relevant effect of the duty of the host to guest and the danger of
collusion between them to defraud the hosts insurer. MN Courts
opinion is that their principle factor is that automobile accidents
occurring within the borders can reasonably be expected to require
 treatment in their medical facilities, and they fear it might offer a
minor incentive to hospital shop or create litigation-directed
pressures on the payment of debts to medical facilities.
(5) MN Court is firmly convinced of the superiority of the common-law
rule of liability to that of the Ontario guest statute. Find little reason
from the strict limitation of a hosts liability to his guest beyond the
fear of collusive suits and vague disapproval of a guest biting the hand
that feeds him. MN Court believes that judicial system can uncover
collusive suits without such over-inclusive rules, and do not find
discomfort in the prospect of a guest suing his host for injuries through
the hosts simple negligence.
6) Second Restatement on Conflicts of Law
a) Approach to Torts
i) 6: General Section on Choice-of-law Principles
(1) A court, subject to constitutional restrictions, will follow a statutory
directive of its own state on choice of law.
(2) Factors relevant to the choice of the applicable rule of law include:
(a) Needs of the interstate and international systems(Rarely Applied in
Torts)
(b) The relevance of forum policies
(c) The relevance of other interested states policies and the respective
interest of those state in the determination of the particular issue,
(d) The protection of the justified expectations (Not Applied in Torts)
(e) The basic policies underlying the particular field of law
(f) Certainty, predictability, and uniformity of result, and (Not Applied
in Torts)
(g) Ease in the determination and application of the law to be applied.
ii) Note: 6 applies to all areas of conflictsnot just torts.
iii) 145: General Rules of Tort
(1) The rights and liabilities of the parties with respect to an issue in tort
are determined by the local law of the state which, with respect to that
issue, has the most significant relationship to the occurrence and the
parties under the principles stated in 6.
(2) Contacts to be taken into account in applying the principles of 6 to
determine the law applicable to an issue include:
(a) The place where the injury occurred,
(b) The place where the conduct causing the injury occurred,
(c) The domicile, residence, nationality, place of incorporation and
place of business of the parties, and
(d) The place where the relationship, if any, between the parties is
centered.
 iv) More than 30 specific rules apply either to particular types of torts (like
malicious prosecution) or issues (like contributory negligence). The rules
for specific torts select the law of some jurisdiction unless another
jurisdiction has a more significant relationship under 6s principles.
v) MOST IMPORTANT:
(1) Personal Injury 146
(2) Injury to Tangible Things
(3) Death. (171) Apply the law of the place of the injurynot necessarily
where the death occurs.
vi) Broad Application:
(1) Separately discuss each issue on which the jurisdiction provide
conflicting laws.
(2) Identify any applicable specific rules (like the place of injury for
personal injury claims).
(3) Consider whether another place has the most significant relationship
to the occurrence and parties with respect to the issue.
(4) Identify applicable interests and policies (6)
(5) If there is a false conflict, apply the law of the only state with an
interest.
(6) If there is a true conflict, evaluate the relative strengths of the states
interests in applying their law.
(7) Discuss contacts that relate to those interests and policies (145).
b) Unstated Law
i) Assumption 1: Babcock (and similar) were rightly decided (True Conflicts)
ii) Assumption 2: In a genuine false conflict, then apply and interest-like
analysis. If its a loss-shifting rule, if all the parties are from one state,
then, (influenced by interest-analysis), then that state most important
facts will be the interest of the forum, and so 145/6 will apply. (loss
shifting, e.g., spousal immunity)
c) Phillips v. General Motors Corp., 995 P.2d 1102 (Mont. 2000)
i) Facts. Darrell Byrd purchased a pickup truck from a wholesaler in North
Carolina. Mr. Bryd was driving the GM truck (with fuel tanks mounted
outside the fuel rail) from their home in Montana to North Carolina, and
were killed along with the family when a semi-truck collided with them.
Samuel Byrd is the only survivor. Products liability lawsuit.
(1) North Carolina: Truck bought/sold
(2) Montana: Plaintiff domiciled; Probate; Strict Liability for Products
Liability.
(3) Kansas: Accident occurred
(4) Michigan: Truck manufactured
ii) Issues: Which law apply? Plaintiff claims Montana law applies under
most significant relationship test. Defendant claims Kansas law
applies.
(1) Will Montana follow the Restatement (Second) of Conflicts including
the most significant relationship test?
(2) Which states law applies to plaintiffs various tort and damages claim
under Montanas choice-of-law rule?
(3) Is there a public policy exeception?
iii) Rule:
(1) Traditional rule affords the consistency and predictability across
jurisdictions; (Too many escape devices). Montana adopts 2nd Rest.
(2) Apply 6 (statutory directive not present in MT), then move to 145,
(3) No, there is no public policy exception to the second restatement of
conflicts, which discuss (at length) the policies of the each jurisdiction.
To have a public policy exception would be redundant.
iv) Discussion. 146/175- Local law governs (Kansas), unless another state
has a more significant issue. More Significant relationship test is
(145(2)).
(1) 6(2)(a) -Needs of Interstate and International System. Points to the
importance of the Restatements approach.
(2) 6(b)(c) Policies of Interested States.
(a) Place of Injury
(i) The overriding purpose of Kansas product liability laws is to
establish the level of safety of products either sold in Kansas or
to a Kansas resident. (Comparative Negligence applies in
Kansas).
(ii) Kansas has no interest in allocating responsibility for the
injuries suffered by Montana and caused by a product purchased
in NC. Similarly Kansass punitive damage provisions apply
only if it had an interest in punishing the conduct at issue.
(b) Place of Conduct
(i) NC court would not apply NC law to these facts, even if the
Byrds had remained in NC; NC still adheres to the traditional
place of injury rule in tort cases.
(ii) Michigan courts have not applied its product liability law in
similar cases.
(iii) Applying the law of the place of manufacturer would be unfair
because it would tend to leave victims undercompensated as
states wishing to attract and holding companies would raise the
threshold of liability and reduce compensation. (race to the
bottom)
 (c) Residence of Parties
(i) Plaintiffs were residents of Montana at the time they were
injured. Only reason surviving Byrd is currently residing in NC
is because his parents died in the accident which forms the basis
of the plaintiffs claims.
(ii) The purpose of Montanas laws regarding the availability and
extent of punitive damages in product liability actions would be
furthered by their application.
(iii) The focus of Montana law is not only the regulation of
Montana products, but also on providing the maximum
protection and compensation to MT residents with the focus on
the condition of the products and not on the conduct of the
manufacturer.
(d) The place where the relationship, if any, between the parties is
Centered.
(i) Dont appear that there is a place where the relationship is
centered (if any).
(e) Certainty, Predictability, Uniformity, Ease do not seem to be more
favored by the application of any one particular jurisdictions law,
since this is a tort.
d) America Online, Inc. v. National Health Care Discount, Inc., 121 F. Supp. 2d
(D. Iowa 2000)
i) Facts. -AOL (Delaware Corporation, Virginia-Principle Place of
Business) sued a NHCD (Iowa Corporation), that delivered spam.
ii) Issue. What conflicts of law rule applies (particular for internet).
iii) Rule.
(1) Note: A federal court exercising supplemental jurisdiction over state
law claims in a federal question lawsuit must follow choice-of-law rules
of the forum state. Accordingly, the court looks to Iowas choice-of-law
rules to determine which state laws applies.
iv) Rationale. The only locale in which AOLs alleged injury is clearly
demonstrable is Virginia. This is the site of AOLs hardware that it
alleges was overburdened by NHCDs UBE. It also is the place where
AOL alleged sustained economic loss. Although no state has a clear
relationship to the events giving rise to the action, VAs relationship
appears to be the most significant and VA law shall control the non-
statutory claims raised in this lawsuit.
e) McDaniels v. Ritter
i) Rule. Apply 2nd Restatement. 145, brings you to 6, the place of the
injury controls, unless another state has more significant contacts. Not a
mechanical approach.
 ii) Application:
(1) Missouri: Place of injury/Tort; conducting business in MO
(2) Tennessee: Has the most significant contacts: (1) Plaintiff
representatives; (2) Plaintiff decedent Ritter employer forum; (3) Pilots
business in TN; (4) PPB was in TN; (5) Claim was originated in TN; (6)
Leaseback of airplane was in TN; (7) Flight began and was to end in
TN; (8) employer originated in TN
(3) Mississippi: Decedent from MS
f) Miss.
i) Is it Substantive or Procedural
(1) If Procedural, Mississippi law will govern.
(2) If Substantive, Apply Second Restatement, 145 (most significant
relationship) conduct, specific pointers.
(3) Possibly, Consider the possible public policy exception, that allows
them to apply the another state, OR do the 6 considerations for the
forum approach.
7) Modern Approaches to Contracts.
a) Overview
i) Is it covered by the UCC?
(1) Things that ARENT in the UCC (Sale of Land, Service Contracts)
(2) Applies to Most commercial transactions.
(3) Codified in separate forms by different statutes in each states.
(4) There can be minor differences, including choice-of-law provisions.
ii) MS 75-1-301. Choice-of-law provision.
(1) If there is a choice-of-law provision, it is valid, if there is a reasonable
relationship between the provision and the parties, then you apply it.
If no reasonable relationship, then it is not valid. In that case, we
apply, forum UCC because one of the parties has an appropriate
relationship.
(2) If you are NOT in the UCC, then its covered under the Second
Restatement. If there is a choice-of-law provision? If so, then ask,
whether the problem could have been resolved by the addition of an
additional contract provision. If So, then pick the law of the forum. If
they could NOT have resolved it by additional contract provisions, its
still valid, unless (1) If there is not substantial relationship or other
reasonable basis to the choice-of-law provision; OR (2) contrary to a
fundamental policy of a state with the most significant contacts of a
material greater
iii) 188 analysis Most significant test analysis; cross reference 6.
b) Nedlloyd Lines B.V. v. Superior Court of San Mateo County Seawinds Ltd.,
834 P.2d 1148 (1992).
 i) Facts. A shipping company, incorporated in Hong Kong with its principal
place of business in California, entered into a contract with three other
shipping companies, incorporated, and with their principal place of
business, in the Netherlands. The contract contained a choice-of-law
clause providing that the contract was to be governed by Hong Kong law.
The Hong Kong corporation brought an action against the other
corporations which included causes of action for breach of the implied
covenant of good faith and fair dealing and breach of fiduciary duty.
ii) Rules. The proper approach under Restatement 187 (2): court must
determine (1) whether the chosen state has a substantial relationship to
the parties or their transaction, or (2) whether there is any other
reasonable basis for the parties choice of law. If neither of these tests is
met, that is the end of the inquiry, and the court need not enforce the
parties choice of law. If, however, either test is met, the court must next
determine whether the chosen states law is contrary to a fundamental
policy of California. If there is no such conflict, the court shall enforce the
parties choice of law.
(1) Note: the tort-law claim of breach of fiduciary duty, does not allow for
the displacement of Hong Kong law. Moreover, their incorporation in
that state affords a reasonable basis for choosing Hong Konglaw
iii) Holding. The Supreme Court reversed the judgments of the Court of
Appeal and remanded to that court directing the trial court to reconsider
its ruling on defendants' demurrer in light of applicable Hong Kong law. It
held that the choice-of-law clause, which required that the contract be
"governed by" the law of Hong Kong, was fully enforceable and applicable
to claims for breach of the implied covenant of good faith and fair dealing
and for breach of fiduciary duties allegedly arising out of the contract,
since Hong Kong was a jurisdiction having a substantial connection to the
parties, and there was a substantial basis for choosing Hong Kong law.
c) Banek, Inc. v. Yogurt Ventures U.S.A., Inc., 6 F.3d 357 (6th Cir. 1993)
i) Facts. Plaintiff Michigan corporation entered into a franchise agreement
with defendant Georgia corporation containing a choice of law provision
that provided the rights of the parties were governed by the laws of
Georgia. Plaintiff brought a series of state law actions against defendant
and subsequently asserted that the choice of law provision was invalid
because it violated the Michigan Franchise Investment Law.
ii) Rule. A contractual choice of law provision will govern 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
would be the state of the applicable law in the absence of an effective
choice of law by the parties.
(1) Providing that waivers and releases are void is not equivalent to
voiding choice of law provisions.
iii) Holding. The court affirmed the lower court's decision and found that the
choice of law provision was enforceable. The court noted that contrary to
plaintiff's assertions, a law providing that waivers and releases depriving
a franchisee of his or her rights were void under Michigan law and did not
void contractual choice of law provisions. The court noted that contractual
choice of law provisions governed unless the chosen state had no
substantial relationship to the parties or transaction or application of the
law of the chosen state would be contrary to the public policies of a state
with a greater material interest in the position of the case. The court
found that this was not the case here because the Michigan and Georgia
statutes were similar.
iv) Georgia law applies. Is the Michigan law valid? If it is valid, is it
enforceable? If it is valid and enforceable, does it violate a specific
fundamental policy of Michigan?
(1) Test: Determine its Scope.
d) Kipin Industries, Inc. v. Van Deilen International, 182 F.3d 490 (6th Cir.
1999)
i) Facts. In Kipin, Plaintiff is a Pennsylvania Corp. with a PA is the PPB.
Defendant is a Michigan Corp, with MI is the PPB. KY is the work site.
The contract says that Michigan law applies. Plaintiff waives right to
place lien on property. Kentucky law allows lien waivers. Michigan
doesnt allow lien waivers.
ii) Rule: If the chosen law results in a void contract, then do not apply the
chosen law unless the chosen law of the state with the most significant
contacts (188 winner), then apply the law anyway.
iii) Rule: If the chosen law results in a void term/clause, then apply the
chosen law generally but apply the law of the state with the most
significant contacts (188 winner), to the void clause/term.
iv) Holding. Kentucky is the 188 winner.
8) Wrinkles in the Theory of Modern Choice of Law
a) Domicile. Modern theories assumption that state policies are often triggered
by domicile makes domicile a key concept to the choice of law process. It is
not clear which states have interests in protecting a corporation.
i) Reich v. Purcell, 442 P.2d 727 (1967)
(1) Facts. The accident occurred in Missouri, one party resided in Ohio,
and the other in California. Missouri limited wrongful death damages,
 yet California and Ohio did not. The court held that in a complex
situation involving multi-state contacts, no single state alone could
have been deemed to create exclusively governing rights. Considering
the interests of all three states involved, the court found that the
driver's liability should not have been limited when no party to the
action was from a state limiting liability. Giving effect to Ohio's
interest in affording full recovery to the injured parties did not conflict
with any substantial interest of Missouri. The Missouri limitation did
not apply.
(2) Rule. At the time of the accident to change the family domicile were
not definite and fixed, and if the choice of law were made to turn on
events happening after the accident, forum shopping would be
encouraged.
(3) Rule. Plaintiffs present domicile in California does not give this state
any interest in applying its law, and since California has not limitation
on damages, it also has no interest in applying its law on behalf of
defendant.
(4) Rationale. Apply Ohio law, as former domiciliary state, in affording
full recovery.
(5) NOTE: Changes in domicile after the accident (2nd Restatement):
Presumably, a change of domicile should have no effect upon the law
governing most of the issues involving the accident., But is this
necessarily true of all issues? The problem is not dealt with in the
Restatement of this subject because existing authority is too sparse to
warrant doing so.
b) Renvoi
i) Pfau v. Trent Aluminum Co., 263 A.2d 129 (1970)
(1) Facts. Plaintiff Connecticut domiciliary was injured in Iowa while a
passenger in an automobile driven by defendant New Jersey
domiciliary and owned by defendant New Jersey corporation.
Defendants pleaded as a defense Iowa's guest statute that relieved a
host-driver from liability to his passenger-guest for negligence.
Because Iowa had no interest in the litigation, and the substantive
laws of Connecticut and New Jersey were the same, the case presented
a false conflict and plaintiff had the right to maintain an action for
ordinary negligence. Principles of comity and the equal protection and
privileges and immunities clauses of the constitution dictated that
plaintiff should have been afforded the same protection a New Jersey
plaintiff would have been given.
(2) Rule. Dont do renvoi, since state conflict of law statutes dont
attached to states substantive law.
 (3) Holding. Only the foreign substantive law should be applied (agreeing
with the court in Reich ). Since Iowa has no interest in the litigation,
and since the substantive laws of Connecticut and New Jersey are the
same, this case presents a false conflict.
(4) Outcome. The court reversed and reinstated the order of the trial
court that struck the defense of the Iowa guest statute. Because Iowa
had no interest in the case New Jersey law applied and allowed
plaintiff to maintain an action for ordinary negligence.
c) Substance v. Procedure.
d) Statutes of Limitations
i) Ledesma v. Jack Stewart Product, Inc., 816 F.2d 482 (9th Cir. 1987)
(1) Facts. Appellants, residents of California, brought an action in a
California district court for injuries they sustained in an automobile
collision with appellees, residents of Oklahoma. Upon motion of
appellees pursuant to Fed. R. Civ. P. 12(b)(6), the district court
dismissed appellants' action as barred by the one-year statute of
limitations. Appellants sought review, contending that Arizonas two-
year statute of limitations should have applied. The court reversed the
order and remanded the cause for further proceedings, finding that the
district court was to apply the choice-of-law rules of the forum state,
and California had adopted the governmental interest approach in
resolving such issues. The court determined that a conflict existed
between the statutes of limitations of California and Arizona, but
California's interests would not be greatly impaired by the application
of the Arizona statute of limitations while, on the other hand, Arizona's
interests would be greatly impaired by application of the California
statute of limitations.
(2) Facts.
(a) California: Plaintiff Resides
(b) Arizona: tort/injury
(c) Arizona: /Driver domiciled
(d) Oklahoma: corporation/owner domiciled
(3) Rule.
(4) Outcome. The court reversed the order that granted the motion of
appellees to dismiss the action for personal injuries brought by
appellants, finding that the conflict of laws between the statutes of
limitations for California and Arizona had to be resolved in favor of
Arizona under the governmental interest approach applied by
California courts. The court remanded the cause for further
proceedings.
ii) Global Financial Corp. v. Triarc Corp., 715 N.E.2d 482 (1999)
 (1) Facts. Defendant retained plaintiff to perform certain consulting
services. Plaintiff sued defendant to recover its commission and fees.
The trial court granted defendant's motion to dismiss the action based
on N.Y. C.P.L.R. 202 for failure to comply with the statute of
limitations of either Delaware, where plaintiff was incorporated, or
Pennsylvania, where plaintiff had its principal place of business.
(2) Rule. On appeal, the court affirmed because when a nonresident sued
on a cause of action accruing outside of New York, N.Y. C.P.L.R. 202
required the cause of action to be timely under the limitation periods of
both New York and the jurisdiction where the cause of action accrued.
(Borrow Statute of Limitations of foreign jurisdiction, and use the
shorter.)
(3) Rule. When an injury was purely economic, the place of injury was
where plaintiff resided and sustained the economic impact of the loss.
Thus, the shorter out-of-state statute of limitations applied.
(4) Outcome. The court affirmed the appellate division's grant of
defendant's motion to dismiss plaintiff's action to recover its
commission under a consulting contract because the out-of-state
statute of limitations applied. When an injury was purely economic,
the place of injury was where the plaintiff resided and sustained the
economic impact.
iii) 2nd Restatement on Conflicts of Law, 142. Statute of Limitations
(1) Whether a claim will be maintained against the defense of the statute
of limitations is determined under the principles stated in 6. In
general, unless the exception circumstances of the case make such a
result unreasonable:
(a) Forum will apply its own statute of limitations barring the claim.
(b) Forum will apply its own statute of limitations permitting the claim
unless:
(i) Maintenance of the claim would serve no substantial interest of
the forum; AND
(ii) The claim would be barred under the statute of limitations of a
state having a more significant relationship to the parties and
the occurrence.
iv) Richards v. U.S., 369 U.S. 1 (1962)
(1) Facts. Actions arose from an airplane crash in Missouri. Airplane was
en route from Tulsa, Oklahoma to New York City. Plaintiffs were
representatives of dead passengers. Government was named as
defendant under the theory that the FAA was negligent in failing to
enforce safety regulations of the American Airlines in the Tulsa
overhaul depot. Negligence occurred in Oklahoma, crash occurred in
 Missouri. Under the Federal Tort Claims Act, the federal government
waives its immunity and liability arises under circumstances when
the US, if a private person, would be liable to the claim in accordance
with the land of the place where the act or omission occurred. 28 USC
1346.
(2) Rule. FTCA requires application of the whole law (law + conflicts of
law law) of the state where the act or omission occurred.
(a) Where the forum state is the same as the one in which the act or
omission occurred, treat the US as an individual.
(b) Where more than on State has sufficiently substantial contact with
the forum state, by analysis of interests possessed by the States
involved, could constitutionally apply to the decision of the cause,
the law of one or more state having such an interest in the
multistate activity.
(3) Holding. Oklahoma State Court is free to apply the Oklahoma whole
law, which is traditional conflicts of law, thereby, applying the law of
the place where the negligence occurred. Therefore, also apply
Missouri limits on damages.
(4) NOTE: 26 USC 268(k): FTCA doesnt apply to claims arising under a
foreign jurisdiction.
9) Erie Doctrine/Erie Problem - Erie and Choice of Law
a) Klaxon Co. v. Stentor Electric Manufacturing Co., 313 U.S. 487 (1941)
i) Facts. The court reversed a decision that affirmed a judgment recovered
by respondent New York corporation for breach of a contract by petitioner
Delaware corporation, and a grant of respondent's motion to correct the
judgment by adding interest at the rate of six percent under 480, which
was applied in the Delaware federal court.
ii) Rule. Subject only to review by the Supreme Court on any federal
question that may arise, Federal courts must apply choice of law rules
from the state in which it sits.
(1) :We are of opinion that the opinion that the prohibition declared in
[Erie] against such independent determinations by the federal courts,
extends to the field of conflict of laws.
iii) Holding. The court held that in diversity cases, the federal courts were
required to follow conflict of laws rules prevailing in the states in which
they sat. The prohibition against independent determinations by the
federal courts extended to the field of conflict of laws. Therefore, the
conflict of laws rules to be applied by the federal court in Delaware were
required to conform to those prevailing in Delaware's state courts. The
court made no analysis of Delaware decisions that had contrary
 viewpoints on application of the New York Civil Practice Act and left that
issue for the court of appeals on remand.
iv) Rationale: Otherwise, the accident of diversity of citizenship would
constantly disturb the equal administration of justice in coordinate state
and federal courts sitting side by side. (principal goal of uniformity)
b) Ferens v. John Deere Co., 494 U.S. 516 (1989)
i) Facts. Plaintiff farmer was injured in an accident with a combine
harvester. Plaintiff brought an action in a Pennsylvania federal court
against defendant manufacturer, raising contract and warranty claims,
and an action in a Mississippi federal court, based on diversity
jurisdiction, alleging negligence and products liability. The tort action was
not barred under Mississippi law. Plaintiff then filed an action under 28
U.S.C.S. 1404(a) to transfer the Mississippi action to the Pennsylvania
federal court as a more convenient forum. The motion was granted, but
the district court dismissed the tort action after invoking the
Pennsylvania two-year statute of limitations period. The appellate court
affirmed, holding that a transferor court's choice-of-law rules did not
apply after a transfer under 1404(a).
(1) Although Mississippi has a borrowing statute which, on its face, would
seem to enable its courts to apply statutes of limitations from other
jurisdictions, the State Supreme Court has said the borrowing statute
only applies where a nonresident [defendant] in whose favor the
statute has accrued afterwards moves into this state.
ii) Issue.
iii) Rule. The Court found that 1404(a) did not deprive parties of state-law
advantages that existed absent diversity jurisdiction. The Court noted
that the decision to transfer venue under 1404(a) turned on
considerations of convenience and the interest of justice.
(1) If there is a 1404(a) transfer, may pre-empt state law, plaintiff has a
choice law in either state, {Exception to the general Klaxon Rule]
iv) Holding. The Supreme Court reversed, holding that the Mississippi
statute of limitation governed the action.
c) Atlantic Marine Const. Co v. U.S. District Court for the Western Dis. Of
Texas, 134 S. Ct. 568 (2013).
i) Review
(1) Klaxon: Federal Court must apply conflict law rules of state in which it
sits
(2) Van Dusen: Following 1404(a) request by Defendant, 2nd court must
follow choice of law rules of 1st court.
(3) Ferens: Follow 1404 request, 2nd court must follow choice of law rules
of the 1st court regardless of who initiates the transfer.
 ii) Facts. When Plaintiff files in State A, makes 1404(a) transfer to B
because forum selection says B should apply.
iii) Rules. A district court should transfer a case to the contractually chosen
forum unless extraordinary circumstances unrelated to the convenience of
the parties clearly disfavored the transfer. Property application of
(1) When forum selection clause points to federal district court, 1404(a),
Forum selection clause almost always controls:
(a) Plaintiff choice is given no deference; Plaintiff has burden to
overcome the forum selection clause.
(b) Only public factors will be relevant; private factors must point to
the forum selection clause.
(c) Requested Van Dusen/Ferens does not apply to these transfers.
(d) In other words, the choice-of-law principles of the contractually
chosen rather than the transferor court will apply.
(2) When forum selection clause points to a foreign court, the most
appropriate manner of addressing this is through the doctrine of forum
non conveniens. Piper Aircraft Co, 454, U.S. 235 (1981).
(a) Under the forum non conveniens doctrine, federal district court
have discretion to dismiss a case if they determine that there is an
adequate alternative forum and various private and public interest
factors weigh in favor of adjudicating the case in that forum.
10) Review Problems
a) 1
b) 2: >> On its face, this looks like the Richards v. US. Where there may be
some govt liability, the Federal Tort Claims Act, provides that the govt
allows for some claims of its go. However, 26 USC 268(k): FTCA doesnt
apply to claims arising under a foreign jurisdiction. Since the claim is arising
in the foreign jurisdiction, the government is not waiving its sovereign
immunity. So. No, do not accept the settlement offer.
c) 3
d) 4
e) 5: >> Brought in State court (S. Cal) moved to District Court of (S.Cal), then
a 1404(a) transfer. The Contract chooses North York. Defense is available
in Southern California. No defense available in North York. Southern Cal
follows first restatement. North York follows second restatement.
i) First, the federal court will grant the transfer to North York, due to the
presence of a Forum Selection Clause. Atlantic Marine Construction
Company holds that a district court should transfer (1404(a)) a case to
the contractually chosen forum unless extraordinary circumstances
unrelated to the conveniences of the parties clearly disfavored the
transfer. Plaintiffs choice is given no deference and has the burden to
 overcome the forum selection clause, only the public factors will be
relevant, and the Van Dusen/Ferens do not apply to these transfers.
ii) Second, since Van Dusen/Ferens factors do not apply, Under Atlantic
Marine, in which the federal court holds that following a 1404(a) must
apply the conflict law rules of the state in which it sites. Therefore, the
conflict of law of North York, namely the second Restatement, applies to
this conflict of law.
iii) Third, under the Second Restatement of Conflicts, of contract, the conflict
will, the choice of law provision for North York (Nedlow case), is
enforceable if it something they could have agreed to. There, was a
substantial connection with the with the pro. Its also, 188 winner, the
general section that appliesWHEN there is no choice of law provision.
In order for the chosen law not to be used, there must be a state with a
materially greater interest that is contrary to a fundamental policy.
f) Narnia; Mordor; Zuckland problem.
i) Decedent died domiciled in Narnia. Land is in Mordor (real property).
Horse is in Zuckaland (personal property).
ii) Under Narnia (holographic will); local law allows holographic wills.
Under either Mordor, or Zuckaland, holographic wills not allowed.
iii) Who takes what?
iv) For a will of land: The Rule of Law (under the first restatement), we look
at the law where the land is. Since there is not a valid will. The law that
applies is intestate succession, is then Dos is then the taker of the real
property.
v) For a will of property: The rule of law (under the first restatement), we
look to the place where the decedent died domiciled. Since the will is valid
in Narnia, then the testator takes, thus Aslan takes the horse.
11) Constitutional Limitations on Choice of Law
a) Relevant Constitutional Provisions
i) Due process and equal: U.S. Const. amend. XIV, 1.
ii) Full faith and credit clause and statute: U.S. Const. art. IV, 1.; 28 USC
1738
iii) Privileges and immunities Clause: U.S. Const. art. IV, 2
iv) The Commerce Clause: U.S. Const. art. I, 8.
b) Home Insurance Co. v. Dick, 281 U.S. 397 (1930)
i) Facts. Appellee insured brought an action against insurer to recover on a
policy of fire insurance for the loss of a tug. Jurisdiction was asserted in
rem through garnishment, by ancillary writs issued against appellants,
garnishees, and reinsurers. Appellants were out-of-state corporations.
They asserted that appellee was not entitled to recover as the insurance
contract was made and was to be performed in Mexico, and appellee failed
 to comply with a contract provision requiring that judicial suits or
demands were to be filed within one year from the date of damage.
Appellee demurred on the ground of Tex. Rev. Civ. Stat. art. 5545 (1925),
which invalidated any agreement that limited the time to bring suit to
less than two years. A trial court sustained appellee's demurrer, and the
judgment was twice affirmed. The United States Supreme Court reversed
the judgment. It found that the statute attempted to impose a greater
obligation than that agreed upon and to seize property in payment of the
imposed obligation, in violation of the guaranty against deprivation of
property without due process of law. Moreover, the statute attempted to
abrogate the rights of parties beyond its borders.
ii) Issue. Does a state statute violate due process where it purports to
establish rights and duties who have no connection to such state?
iii) Rule. A state statute violates due process where it purports to establish
rights and duties of parties who have no connection to such state.
iv) Holding. Yes, As applied to the New York reinsurance company
defendants, the TX statute deprives them of property in violation of due
process. The TX statute is more than a statute of limitation; by
prohibiting certain contracts from being made and modifying or
invalidating the enforcement of contracts made elsewhere, the article
creates or imposes obligations. It is a violation of due process for a state
to abolish the rights of a party that has no connection to such state.
c) Pacific Employers Insurance Co. v. Industrial Accident Commission , 306 U.S.
493 (1939)
i) Facts. The employee, who regularly worked at the employer's head office
in Massachusetts, was injured while he was temporarily in California on
the business of his employer. The California Industrial Accident
Commission applied the California Workers' Compensation Act, which
awarded compensation for injuries suffered by an employee within
California, and refused to apply the Massachusetts Workers'
Compensation Act, which provided that the Massachusetts Act was the
exclusive remedy available to Massachusetts employees.
ii) Issue. Whether the full faith and credit which the Constitution requires
to be given to a Massachusetts workmens compensation statute precludes
California from applying its own workmens compensation act in a case
where injury suffered by a Massachusetts employee of a Massachusetts
employer while in California in the course of his employment.
iii) Rule. Full faith and credit does not here enable one state to legislate for
another or to project its laws across state lines so as to preclude the other
from prescribing for itself the legal consequences of acts within it. AKA
Full faith and credit doesnt prevent it from applying its own laws.
 iv) Holding. On review, the Court held that California was not required to
give full faith and credit to the Massachusetts Act because the application
of the Massachusetts Act would have been obnoxious to California's policy
of applying its own provisions for compensation to the exclusion of all
others.
d) Watson v. Employers Liability Assurance Corp., 348 U.S. 66 (1954)
i) Facts. Plaintiffs brought a direct action against defendant liability
insurance company after plaintiff wife was injured by a hair product.
Plaintiffs were allowed to bring the action based on Louisiana statutes
that allowed injured persons to bring a direct action prior to final
determination. Another statute allowed injured persons to bring the direct
action even though, as here, the insurance contract was made in another
state and contained a clause forbidding direct actions. A final statute
made foreign insurance companies consent to direct suits in order to do
business in Louisiana.
ii) Issue. Whether the Federal Constitution forbids LA to apply its own law
and compels it to apply the law of MA or IL.
(1) **Louisiana has an interest in protecting citizens
iii) Rule. The Full Faith and Credit Clause does not automatically compel a
state to subordinate its own contract laws to the laws of another state in
which a contract happens to have been formally executed. Where a
contract affects the people of several states, each may have interests that
leave it free to enforce its own policies. {legitimate interest rule}
iv) Holding. The court reversed. Louisiana was allowed to use its own law in
plaintiffs' suit, and the statutes were constitutional. Louisiana had a
legitimate interest in safeguarding the rights of persons injured in
Louisiana. The direct action provisions therefore did not violate due
process. The Full Faith and Credit Clause did not compel Louisiana to
abandon use of its own law because Louisiana's legitimate interest in
protecting people injured there justified use of its law.
e) Direct Actions (Only Exist in 3 States)
i) Rule. If a jury is aware of insurance, they are prejudiced. It is reversible
error.
ii) Contracts specifically provided a no action clause (no direct action). Thats
the common law.
iii) In direct action, the person injured by a tortfeasor can sue the insurance
company directly.
(1) Whether or not, (outside of Louisiana) will they recognize direct claims.
(on grounds of public policy, on prodedural grounds,
(2) Whats Louisiana gonnna do? Its not unconstitutional.
f) Clay v. Sun Insurance Office, Ltd., 377 U.S. 179 (1964)
 i) Facts. Petitioner purchased insurance policy from respondent in Illinois
while he was a citizen and resident of that state. Respondent was licensed
to do business in Illinois, Florida, and several other states. Petitioner
moved to Florida and became a citizen and resident of that state, and it
was there that a loss occurred two years later. Petitioner sought review of
a judgment from appeals court holding it was not compatible with due
process for Florida to apply its statutes nullifying a 12-month-suit clause
in petitioner's insurance policy because it required suit to be filed in less
than five years.
ii) Issue. Whether the 12-month-suit clause in the policy govern (in which
event the claim is barred), or whether Floridas statutes nullifying such
clauses if they require suit to be filed in less than five years are applicable
and valid (in which event the suit is timely).
iii) Rule. There is no difficulty whatever under either the Full Faith and
Credit Clause or the Due Process Clause when dealing with an
ambulatory contract on which suit might be brought in any one of several
states. A state having jurisdiction over a claim deriving from an out-of-
state employment contract need not substitute the conflicting statute of
the other state or its own statute--where the employee was injured in the
course of his employment while temporarily in the latter state.
iv) Holding. On appeal, the United States Supreme Court reversed. It saw no
difficulty whatever under either the Full Faith and Credit Clause or the
Due Process Clause. The Court found they were dealing with an
ambulatory contract in which suit could have been brought in any one of
several states. Here, Florida had ample contacts with the present
transaction and parties to satisfy any conceivable requirement of full faith
and credit or due process.
g) Allstate Insurance Co. v. Hague, 449 U.S. 302 (1981)
i) Facts. The lower court's decision to use Minnesota substantive law was
affirmed. The decedent, a Wisconsin resident, died from injuries suffered
in an automobile accident in Wisconsin involving another Wisconsin
resident. Respondent, the decedent's wife, sought to collect uninsured
motorist coverage on all three of decedent's vehicles. Minnesota law
allowed stacking of the three uninsured motorist coverages, while
Wisconsin law did not. Respondent sued petitioner in Minnesota, which
chose to use its own substantive law.
ii) Issue. Whether the Due Process Clause or Full Faith and Credit Clause
bars the Minnesota Supreme Courts choice of substantive law to govern.
iii) Rule. For a states substantive law to be selected in a constitutionally
permissible manner, that State must have a significant contact or
 significant aggregation of contacts, creating state interests, such that
choice of law is neither arbitrary nor fundamentally unfair.
(1) For CHOICE-OF-LAW, you must have minimum substantive contacts.
[Merger of the doctrines of due process and full faith and credit clause]
Nominal domicile, as in Dick, is not enough.
iv) Holding. The court found that Minnesota's choice of its own substantive
law did not violate the Due Process Clause, U.S. Const. amend. XIV, or
the Full Faith and Credit Clause, U.S. Const. art. IV, 1. Minnesota's
contacts with the parties and occurrence were significant enough to
warrant Minnesota choosing to apply its own substantive. The decedent
was a member of Minnesota's work force for 15 years. Petitioner was at all
times doing business in Minnesota and familiar with Minnesota law.
Respondent became a Minnesota resident and there was no evidence she
moved there in anticipation of litigation.
h) Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985)
i) Facts. Petitioner purchased and produced gas from leased land located in
11 states, and sold most of the gas in interstate commerce. Respondents,
royalty owners possessing rights to the gas leases, filed a class action suit
against petitioner seeking to recover interest on royalty payments that
were delayed by petitioner. Respondents resided in all 50 states, the
District of Columbia and several foreign countries. Respondents recovered
over petitioners' objections that Kansas was prohibited from adjudicating
the claims of all respondents and from applying Kansas law to all the
transactions. The state appeals court affirmed the ruling.
ii) Issue.
iii) Rule. For a State's substantive law to be selected in a constitutionally
permissible manner, that State must have a significant contact or
significant aggregation of contacts, creating state interests, such that
choice of its law is neither arbitrary nor fundamentally unfair.
(1) A plaintiff's desire for forum law is rarely, if ever, controlling of a
court's decision to apply that state's law.
(2) A State may not take a transaction with little or no relationship to the
forum and apply the law of the forum in order to satisfy the procedural
requirement that there be a "common question of law."
(3) Kansas must have a significant contact or significant aggregation of
contacts to the claims asserted by each member of the plaintiff class,
contacts creating state interests, in order to ensure that the choice of
Kansas law is not arbitrary or unfair.
(4) Rule. Bootstrap argument: Kansas may not use the assumption of
jurisdiction as added weight in the scale when considering the
permissible constitutional limits on choice of substantive law.
 (5) NOTE: When considering fairness in this context, an important
element is the expectation of the parties.
iv) Holding. The U.S. Supreme Court affirmed the court's jurisdiction over
the claims because the parties were given the opportunity to opt out, but
reversed its application of Kansas law to all the transactions because
Kansas did not have significant contact with each of the class members.
(1) We conclude that application of Kansas law to every claim in this case
is sufficiently arbitrary and unfair as to exceed constitutional limits.