The following entry is excerpted from the Reporters’ Memorandum Introduction to Tentative Draft No.2, which comprises a projected Table of Contents and parts of three Chapters (Chapter 1 (Introduction), Chapter 2 (Domicile), and Chapter 5, Topic 2 (Foreign Law)). If you are interested in obtaining a copy of this draft, please contact us.
This draft will be presented to membership at the 2021 Annual Meeting for approval. Until approved, this is not the position of The American Law Institute and should not be represented as such.
Introduction to Draft
Conflict of laws is the field of law concerned with the resolution of legal questions having connections with more than one state. Typically, it comprises the subfields of personal jurisdiction, recognition of judgments, and choice of law. As the projected Table of Contents shows, we expect this Restatement to address all those topics. We have started with choice of law.
The early American understanding of choice of law, and the position taken by the American Law Institute’s first Restatement, was territorial. A single act or event was used to localize legal transactions such as torts or contracts, and the state within whose borders that act or even occurred was selected as the state whose law would govern. This approach was thought to follow from the nature of law.
The territorial principle came under sustained attack, beginning around the publication of the first Restatement in 1935. Judges and scholars argued that consideration of the policies behind states’ laws showed that the answers provided by the territorial system were often arbitrary, frustrating the policies of states whose law was not selected while not advancing the policies of those whose law was selected.
Analysis in terms of state policies suggested that using a single territorial factor to select the governing law was a mistake. Instead, the choice-of-law revolution suggested that multiple connecting factors might be relevant. These included not just territorial connecting factors—like the place of conduct or injury, or of the formation of a contract—but also personal connecting factors, like the domicile of the parties. Importantly, these contacts would not have the same weight for every issue or every legal rule a state might enact: instead, they would have greater or lesser weight depending on the issue under consideration or the policies behind a state’s law. Sometimes territorial factors would be more significant than personal ones, and sometimes the reverse.
The Restatement Second of the Conflict of Laws, begun in 1953 but not completed until 1971, started out as a relatively modest attempt to modify the rigid rules of the first Restatement to incorporate the more recent insights. By the time the project ended, though, its Reporter had decided that more sweeping change was needed and that choice of law in many areas was not ripe for restatement in the form of rules. “[T[he difficulties and complexities involved,” the second Restatement noted, “have as yet prevented the courts from formulating a precise rule, or series of rules, which provide a satisfactory accommodation of the underlying factors in all of the situations which may arise.” Restatement of the Law, Second, Conflict of Laws § 6, Comment c (Am. Law Inst. 1971). Instead, the second Restatement ended up with an open-ended multifactor balancing approach that offered a nonexhaustive list of six principles to take into account in deciding any choice of law question. The Reporter’s hope was that judicial practice in applying this approach would converge in particular categories of cases, producing decisions that could be restated in the form of rules.
Almost 50 years later, we have a large sample of cases applying the second Restatement and other modern approaches. We are happy to report that in most circumstances, the convergence the drafters of the second Restatement hoped for has occurred. There are recognizable patterns of judicial decisions that can be captured in the form of rules.
Writing such rules is the primary goal of this Restatement. We have two ancillary goals. First, we hope to produce a more user-friendly document than the second Restatement. We seek to be more explicit and transparent about the theoretical framework within which the third Restatement operates, about how its rules were derived, and about how to use them. To that end, we include an introductory section on choice of law (Chapter Five Part 1, not included in this draft) which restates the methodology of modern choice of law, before proceeding to the specific rules. We will also include explicit instruction on how to use the Restatement, and on when exceptional and unforeseen circumstances may justify departure from its rules.
Second, we hope to make choice of law intelligible in terms of ordinary legal concepts. Choice of law is often seen as a forbiddingly esoteric subject, with its own specialized concepts and vocabulary. Beginning in the 1950s, some scholars urged that this exceptionalism was unnecessary, and that modern choice of law could largely be described as ordinary legal analysis. Our survey of modern methodology suggests that this is correct: modern choice of law can be described in ordinary legal vocabulary as a two-step process. The first step is to determine whether the facts of the case fall within the scope of the relevant states’ laws: to determine whether those laws grant the parties rights or impose obligations. This is ordinary legal analysis: as the second Restatement put it, a law’s “range of application … can sometimes be ascertained by a process of interpretation and construction.” Restatement of the Law, Second, of Conflict of Laws § 6, Comment b (Am. Law Inst. 1971). The second step is to resolve any conflicts between rights under different states’ laws.
While the second Restatement committed that question to an open-ended balancing test, this Restatement will contain specific choice-of-law rules organized by subject matter: torts, contracts, property, and so on. A number of those rules have been written and presented to the Council and/or the Advisers. Members may get a sense of those rules from the Projected Table of Contents or from drafts of other Chapters on the Project webpage; however, the material presented at this Meeting contains very few of the rules. Instead, it addresses threshold matters.