Select Page

Conflict of Laws
Wayne State University Law School
Sedler, Robert A.

Conflict of Laws Sedler Winter 2017

Options for K cases: Law of the place of K (Milliken v. Pratt), Law of the place of performance (Pritchard v. Norton), Law intended by the parties (Pritchard v. Norton), Law giving validity to the K (Pritchard v. Norton), Law of the place having the most substantial connection (Restatement 2d §145).

Traditional approach to choice of law

Traditional Theories on Jurisdiction Selection

Traditional choice-of-law thinking placed a high value on uniformity of result, predictability, and the discouragement of forum-shopping:

Place of the Wrong

“Each state has legislative jurisdiction to determine the legal effect of acts done or events caused within its territory.”

This principle provides that the existence of a cause of action for tort depended upon the law of the place of wrong.

But if liability under the law of the place of wrong depends on the application of a standard of care, that standard should be taken from the law of the place of the actor’s conduct; and if a person is required, forbidden, or privileged to act under the law of the place of acting should not be held liable for consequences in another state.

§ 377 “The place of wrong is in the state where the last event necessary to make an actor liable for an alleged tort takes place”

Alabama Great Southern R. R. Co. v. Carroll (1892, 7)

P worked as a railroad brakeman and was injured in Mississippi due to the failure of other employees to inspect the brakes in Alabama. P sued in Alabama under a state statute that would have permitted recovery. MS had no law permitting recovery.
Issue: May recovery be obtained for a tortious act in the state where the breach of duty occurred, but not the injury?
Held: No. The general rule is that recovery cannot be made in one state for the injuries to the person sustained in a different state unless the infliction of the injuries is actionable under the law of the state where the injuries were received. In this case, up to the time the train passed from Alabama, no injury had resulted. The AL statute has no efficiency beyond state lines. Only Mississippi could apply proper jurisdiction over the claim. There may have been a different result if Carroll had been injured in Alabama but suffered in Mississippi. As for an argument that the railroad (D) was under a contractual duty to P, which arose in Alabama, the Alabama law will govern only occurrences of the employment relationship and not with any specific contractual obligations.
RULE: Where a negligent act is committed in one state, but causes injury in a different state, an action seeking damages for injuries resulting from the act may be brought only in the state where the result occurred, and not where the act was committed.

Whether a cause of action can stand must be determined by the law of the place where events giving rise to the complaint took place
Law of another place cannot be allowed to operate upon facts occurring in state where injury occurred so as to create rights and liabilities that don’t exist under the law of the state where injury occurred,

Place of Contracting

Under the Restatement of the Conflict of Laws §332, the law of the place of contracting determines the validity and effect of a promise with respect to:

capacity to make the contract,
the necessary form in which the promise must be made
the mutual assent or consideration required to make a promise binding
any other requirements for making a promise binding
fraud, illegality, or other circumstances that make a promise void or voidable
except as stated in §358, the nature and extent of the duty for the performance of which a party becomes bound
the time when and place where the promise is to be performed
the absolute or condition character of the promise

Under §358, the duty for the performance of which a party to a contract is bound will be discharged by compliance with the law of the place of performance of the promise with respect to:

the manner of performance
the time and locality of performance
the person or persons by whom or to whom performance shall be rendered
the sufficiency of performance
excuse for non-performance

Comments to §311: the place of contracting is the place in which under the general law of contracts the principal event necessary to make a contract occurs. Then, the forum can refer to the law of the state to ascertain if there is a contract under the law.

§ 312: when a formal contract becomes effective on delivery, the place of contracting is where the delivery is made
§ 323: for informal unilateral contract, place of contracting is where the event takes place that makes the promise binding
§ 325: for informal bilateral contract, place of contracting is where the second promise is made in consideration of the first promise
§ 326: when an offer for a bilateral contract is made in one state and an acceptance is sent from another state to the first state the place of contracting is (a) the state where acceptance is delivered if the acceptance is sent by an agent of the acceptor or (b) the state where acceptance is sent if acceptance is sent by any other means

Comment to §326: Where acceptance is authorized by:

Mail: place of K is where the acceptance is mailed
Telegraph: place of K is the place the message of acceptance is received by the telegraph company for transmission.
Telephone: place of K is where acceptor speaks his acceptance
Spoken word by people standing on opposite sides of state boundary line: place of K is where acceptor speaks acceptance

Milliken v. Pratt (1878, 20)

Mrs. Pratt (D) was a resident of Massachusetts and signed a guaranty for the benefit of Miliken (P) , her husband’s creditor and a Maine supplier. At the time of the signing, she was incapable of entering into such a contract, due to Massachusetts law, although no such disability existed in Maine. When her husband defaulted, D refused demand on the guaranty and P brought suit against her in Massachusetts.
ISSUE: May a contract that is valid by the law of one state be enforceable against the citizens of another state in the courts of the second state where such contracts are statutorily invalid?
HELD: Yes. A contract’s validity is to be determined by the law of the state where the contract was made. If a contract was valid in one state, then it is valid and enforceable in every state. If enforcement is sought in the courts of a state where such contracts are held invalid, it is still enforceable unless the contract is immoral in nature. The acceptance of this contract occurred in Maine when Milliken (P) acted on the guaranty. The sales occurred in Maine since delivery was made by common carrier paid by D.

The court does not follow the rule that a state holds power over its inhabitants in everything they do. The contract was made in Maine because she mailed it there and that is where it was final.

RULE: A contract that is valid by the law of the state where it was made is enforceable everywhere including states where such contracts are invalid by statute.

General rule is that validity of a contract is to be determined by the law of the state in which it is made
It is more just, as well as more convenient, to have regard to the law of the place of the contract as a uniform rule operating on all contracts of the same kind

Place of Property

The territorial theory places great emphasis on the law of the place where property is situated. Cases involving interests in immovable property are traditionally governed by the law of the situs.

-The validity of a will is governed as to movable property by the law of the domicile at death and as to immovable property by the law of each situs. If the will complied with testamentary formalities in the state where the decedent was domiciled when it was executed, but does not satisfy the corresponding requirements of the state of domicile at the time of death or of the situs of immovable, the will is invalid and the testator’s intentions are frustrated.

Three reasons for such a rule:

Land and things attached to land are within the exclusive control of the state in which they’re situated
Such property are of great concern to the state in which they’re situated
This rule is convenient and provides certainty

In re Barrie’s Estate (1949, 28)

Barrie, a resident of Illinois who had real property in Iowa and personal property in Illinois, executed a will leaving her property to a church and three named beneficiaries. However, when the will was found it had “Void” written across it. The Illinois court held that the will had been revoked and distributed Barrie’s personal property located in Illinois to relatives who were her heirs under Illinois law of intestate succession. Barrie’s heirs filed objections to the will being offered for probate in Iowa based upon the ruling by the Illinois court saying that the will had been revoked. But, Iowa held the will valid under its laws stating that the Illinois judgment is not conclusive or binding upon Iowa courts in so far as the disposition of Iowa real estate is concerned.
Rule: “The law of the place where the (real) property is located is to govern as to capacity or incapacity of the testator of a will, the forms and solemnities to give the will or testament its due attestation and effect”
Rule: “The revocation of a will is also governed by the law of the state (where the real property is located)”
It is generally held that the Full Faith and Credit Clause does not render foreign decrees of probate conclusive as to the validity of a will, as respects real prop

ants. They lived in Maryland for a long time but state of Maryland would not give son resident tuition saying his Visa was not enough to establish Maryland residence.
EXAM – if we get a question about Domicile it will be stated. “A is a resident of …B is a resident of”

Theoretical Underpinnings to Traditional Choice of Law – Territoriality

Escape Device from Territoriality: Characterization

Escape Device = A way around the old rule of territoriality.

Levy v. Daniels’ U-Drive Auto Renting Co. (1928, 43)

P Levy was injured while riding as a passenger in an automobile rented by Sack (D) from Daniels Auto Renting Co. (D). Sack rented the car in Connecticut then negligently stopped the car in the middle of the highway in Massachusetts where it was hit by Maginn (D). As a result of the accident, P was seriously injured.
The P sued in Connecticut which has a statute that says “anyone who rents a motor vehicle to another shall be liable for any damage to any person or property caused by operation of the vehicle during the rental period.” Massachusetts has no statute defining the liability of motor vehicles. The D Rental Co. demurred, arguing that the law of the place of the tort (Mass.) should apply. P alleges that he is suing upon a contract. Lower court sustained the demurrer but this court overrules that decision.
RULE: The liability that arises from a contract depends upon the law of the place of contract, unless the contract is to be performed or to have its beneficial operation and effect elsewhere, or the contract is made with reference to the law of another place.

P was a beneficiary of the contract which was made for him and every other member of the public.

Some statutes may create liability such that the liability is made part of every contract created in that state, and the liability will follow regardless of place of injury
Levy raises the question of, when can background laws become part of the contract such that courts can characterize tort disputes as contract cases?
Why would CT have this law? A way of raising standards of conduct. Be careful in choosing your lessee because you will be responsible for his conduct.

Sounds like Tort law. Place of the wrong would be the place for tort law.

Haumschild v. Continental Cas. Co. (1959, 45)

Mrs. Haumschold (P) and her husband (D) were residents of Wisconsin travelling in California. While in CA, P was injured in an automobile accident as a result of her husband’s negligence. CA law prohibited a husband or wife from bringing suit against a spouse for negligence, however, the law of Wisconsin did not. Mrs. Haumschild (P) sued her (now ex) husband (D) in Wisconsin.
ISSUE: Where the place of the wrong prohibits husbands and wives from suing each other for negligence, may the court of the spouses’ domicile apply its own law which would allow such suits?
HELD: The law of the domicile is the one that ought to be applied in determining any issue of incapacity to sue based upon family relationship.

2 reasons for this:

The state has the primary responsibility for establishing and regulating the incidents of the family relationship and it is the only state in which the parties can, by participation in the legislation process, effect a change in those incidents.
It is undesirable that the rights, duties, and immunities conferred or imposed by the family relationship should constantly change as members of the family cross state boundaries during temporary absences from their home.

RULE: Interspousal immunity for tort actions is a rule of family law and not tort law and the law of the spouses’ domicile governs, not the law of the place where the wrong occurred.
Haumschild raises the question of, when is domicile of such importance that it is able to override territorial interests?