choiceoflaw

Choice of law, also known as conflict of laws, is the set of rules used to determine which jurisdiction’s law should apply to a legal dispute that has connections with more than one jurisdiction. It governs questions about contract interpretation, non-contractual obligations such as torts, property matters, family issues, and other legal relationships that cross borders.

In practice, the applicable law is often identified through the parties’ agreement or by the forum court’s conflict-of-laws rules. In contracts, the parties frequently include a governing law clause selecting a specific legal system. If there is no clause, or if the agreement is silent, courts apply substantive conflict rules to decide the appropriate law, balancing factors such as the place of contracting, the place of performance, and the locations of the parties and the facts.

The main theories for determining the applicable law include party autonomy (allowing the contract to specify the governing law), the most significant relationship approach (assessing which jurisdiction has the closest connection to the matter), and traditional methods such as lex loci contractus (law of the place where the contract was formed) or lex loci delicti (law of the place where a tort occurred). Some jurisdictions follow harmonized rules, notably in Europe through instruments like the Rome I Regulation for contractual obligations and Rome II Regulation for non-contractual obligations.

Public policy and procedural considerations can limit or override chosen laws. The resulting law governs substantive rights and duties but does not usually dictate procedural issues, which may be governed by the forum’s rules. Choice of law thus shapes interpretation, remedies, and the overall outcome of cross-border disputes.