The traditional conflict rule of lex loci delicti applies in many tort actions[i]. However, many jurisdictions are now following the most significant relationship rule[ii]. Some other jurisdictions follow a governmental interests approach[iii] or comparative impairment analysis[iv].
Traditionally courts have followed the traditional rule of lex loci delictus in determining which state’s substantive law is applicable to actions sounding in tort[v]. Lex loci delictus holds that the substantive law of the place where the tort occurs applies.
Under the principle of lex loci delicti, a court determines the substantive rights of an injured party according to the law of the state where the injury occurs[vi]. It is a recognized principle of the law of the conflict of laws that the law of the state where an alleged tort is completed controls the liability[vii]. Where a tort is committed in one state and sued on in another, the lex loci delicti principle controls[viii].
Lex loci delicti is applied with respect to the substantive phases of torts or the actions thereof, and determines the question of whether or not an act or omission gives rise to a right of action or civil liability for tort[ix]. For instance, where an act of omission or commission occurs at one place and resulting death, personal injury, or damage takes place at another, the situs of the actionable wrong is the place at which the death, personal injury or property damage takes place[x].
Although the substantive rights of the parties are determined by the law of the place of the injury under the traditional rule of lex loci delicti, for procedural matters, the law of the forum, or lex fori, applies. Also, law of the forum will be applied whenever the law of the place of the wrong is contrary to an extraordinarily strong public policy of the forum state.
Similarly, cases of tort arising upon the high seas between parties of different nationalities, in the admiralty courts of the United States, will be governed by the law of the forum[xi]. Additionally, in a diversity case, the court is obligated to apply the law of the forum state, including the forum’s choice of law rules[xii].
In Richards v. United States, 369 U.S. 1 (U.S. 1962), the court observed that the general conflict of laws rule, followed by a vast majority of the states, is to apply the law of the place of the injury to the substantive rights of the parties, but the recent tendency of some states has been to depart from this rule in order to take into account the interests of the state having significant contact with the parties to the litigation.
In Casey v. Manson Constr. & Engineering Co., 247 Ore. 274 (Or. 1967), the court held that in an action for a personal injury, the local law of the state where the injury occurred determines the rights and liabilities of the parties, unless some other state has a more significant relationship with the occurrence and the parties as to the particular issue involved, in which event the local law of the latter state will govern.
Under the most significant relationship rule, the most significant factors are the parties’ domicile and the location of the tort[xiii]. A parties’ forum selection clause in any applicable agreement is also a factor a court will consider. The rights and liabilities of the parties with respect to an issue in tort are determined by the local law of the state which has the most significant relationship to the occurrence and the parties[xiv].
The general principles, which the forum should consider in determining which state has the most significant relationship with the cause of action, are[xv]: the rights and liabilities of the parties with respect to an issue in tort; and contacts to be taken into account in applying the principles of a particular section to determine the law applicable to an issue.
The rights and liabilities of the parties with respect to an issue in tort are determined under the principles[xvi]: the needs of the interstate and international systems, the relevant policies of the forum, the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue, the protection of justified expectations, the basic policies underlying the particular field of law, certainty, predictability and uniformity of result, and ease in the determination and application of the law to be applied.
The specific contacts to be taken into account when assessing which state has the most significant relationship to a tort claim include[xvii]: the place where the injury occurred, the place where the conduct causing the injury occurred, the domicile, residence, nationality, place of incorporation and place of business of the parties, and the place where the relationship, if any, between the parties is centered.
Adoption of the most significant relationship test does not require a court to disregard a foreign jurisdiction’s law in all torts cases[xviii]. The flexibility of most significant relationship doctrine requires that each case be decided on its own facts.
Another significant rule is governmental interest approach. It requires application of the law of the state with the greatest interest in resolving the particular issue that is raised in the underlying litigation[xix].
Under the governmental interests approach, the courts evaluates the governmental policies underlying the applicable laws and determine which jurisdiction’s policy would be more advanced by the application of its law to the facts of the case under review[xx].
The governmental interests analysis consists of three steps[xxi]: 1) the court examines the substantive law of each jurisdiction to determine whether the laws differ as applied to the relevant transaction; 2) if the laws do differ, the court determines whether a true conflict exists in that each of the relevant jurisdictions has an interest in having its law applied. If only one jurisdiction has a legitimate interest in the application of its rule of decision, there is a false conflict and the law of the interested jurisdiction is applied. On the other hand, if more than one jurisdiction has a legitimate interest, the courts move to the third stage of the analysis; 3) the third stage focuses on the comparative impairment of the interested jurisdictions. At this stage, the courts seek to identify and apply the law of the state whose interest would be the more impaired if its law were not applied.
The governmental interests approach has been held applicable not only to situations involving different states of the U.S., but also to those involving a state of the U.S. and a political entity of a foreign nation.
When under the governmental interest approach, a preliminary analysis reveals an apparent conflict of interest upon the forum’s assertion of its own rule of decision, the forum reexamines its policy to determine if a more restrained interpretation of it is more appropriate. This process of reexamination requires identification of a real interest, as opposed to a hypothetical interest, on the part of the forum and can be approached under principles of comparative impairment[xxii].
When faced with the problem of choosing between the laws of two states as to which governs a tort action, the courts make an analysis of the respective interests of the states involved, the objective of which is to determine the law that most appropriately applies to the issue involved[xxiii].
A Court first determines whether the interest or policy underlying the law will be significantly furthered by its application to the case at hand. If both forum state and the foreign state have a strong interest in applying their own law, a true conflict exists. The court then engages in a comparative impairment analysis, and applies the law of the state whose interest would be the more impaired if its law were not applied[xxiv].
Once a preliminary analysis has identified a true conflict of the governmental interests involved as applied to the parties under the particular circumstances of a case, the comparative impairment approach to the resolution of such conflict seeks to determine which state’s interest would be more impaired if its policy were subordinated to the policy of the other state. Comparative impairment analysis proceeds on the principle that true conflicts should be resolved by applying the law of the state whose interest would be the more impaired if its law were not applied[xxv].
In the context of the choice of law analysis, the consideration of the maintenance of reasonable orderliness and good relationship among the states in the federal system requires that a court apply the law of state which has substantial connection with the total facts and with the particular issue being litigated[xxvi].
Choice-influencing considerations are[xxvii]:
- predictability of results;
- maintenance of reasonable orderliness and good relationship among the states in the federal system;
- simplification of the judicial task;
- advancement by the court of its own state’s governmental interests rather than those of other states; and
- the court’s preference for what it regards as the sounder rule of law.
When one of two states related to a case has a legitimate interest in the application of its law and policy and the other has none, the courts apply the law of the interested state[xxviii]. A false conflict of laws occurs when it is found that only a single state has an interest in the application of its law, and that the other state involved has no interest in the application of its law in the case[xxix].
Under the traditional choice-of-law rule of lex loci delicti, the forum court will apply the law of the place of the tort to determine the plaintiff’s right to recover in an action for fraud or deceit, abuse of process, malicious prosecution, or false imprisonment. Further under the rule of the restatement which pertains to actions for interference with the marriage relationship, the local law of the state where the conduct principally occurred determines the liability of one who interferes with a marriage relationship.
When the jurisdictions’ conflicting rules relate to allocating losses that result from admittedly tortious conduct, rules such as those limiting damages in wrongful death actions, vicarious liability rules, or immunities from suit, considerations of the State’s admonitory interest and party reliance are less important[xxx]. Under those circumstances, the locus jurisdiction has at best a minimal interest in determining the right of recovery or the extent of the remedy in an action by a foreign domiciliary for injuries resulting from the conduct of a codomiciliary that was tortious under the laws of both jurisdictions. Analysis then favors the jurisdiction of common domicile because of its interest in enforcing the decisions of both parties to accept both the benefits and the burdens of identifying with that jurisdiction and to submit themselves to its authority.
The question whether conduct which caused damage was negligent, so as to make the one guilty of it liable for a wrong, is determined by the law of the place where the act or omission claimed to be the cause of the damage took place[xxxi]. Further, whether contributory negligence of the plaintiff is a defence, in whole or in part, to an action for a negligent injury also depends upon the law of the place of the injury.
[i] Norris v. Taylor, 460 So. 2d 151 (Ala. 1984)
[ii] Enron Wind Energy Sys., LLC v. Marathon Elec. Mfg. Corp. (In Enron Corp.)., 367 B.R. 384 (Bankr. S.D.N.Y. 2007)
[iii] District of Columbia v. Coleman, 667 A.2d 811 (D.C. 1995)
[iv] Bernhard v. Harrah’s Club, 16 Cal. 3d 313 (Cal. 1976)
[v] Myers v. Hayes International Corp., 701 F. Supp. 618 (M.D. Tenn. 1988)
[vi] Fitts v. Minnesota Mining & Mfg. Co., 581 So. 2d 819 (Ala. 1991)
[vii] Strogoff v. Motor Sales Co., 302 Mass. 345 (Mass. 1939)
[viii] Western Union Tel. Co. v. Hill, 163 Ala. 18 (Ala. 1909)
[ix] Ball v. Ball, 73 Wyo. 29 (Wyo. 1954)
[x] Ling v. Jan’s Liquors, 237 Kan. 629 (Kan. 1985)
[xi] Rundell v. La Compagnie Generale Transatlantique, 100 F. 655 (7th Cir. Ill. 1900)
[xii] Myers v. Hayes International Corp., 701 F. Supp. 618 (M.D. Tenn. 1988)
[xiii] Enron Wind Energy Sys., LLC v. Marathon Elec. Mfg. Corp. (In Enron Corp.)., 367 B.R. 384 (Bankr. S.D.N.Y. 2007)
[xiv] Pust v. Union Supply Co., 38 Colo. App. 435 (Colo. Ct. App. 1976)
[xv] Melton v. Borg-Warner Corp., 467 F. Supp. 983 (W.D. Tex. 1979)
[xvi] Martinez v. Smithway Motor Xpress, Inc., 2000 U.S. Dist. LEXIS 17145 (N.D. Ill. Nov. 22, 2000)
[xvii] Bates v. Superior Court, 156 Ariz. 46 (Ariz. 1988)
[xviii] Travelers Indem. Co. v. Lake, 594 A.2d 38 (Del. 1991)
[xix] Gantes v. Kason Corp., 145 N.J. 478 (N.J. 1996)
[xx] District of Columbia v. Coleman, 667 A.2d 811 (D.C. 1995)
[xxi] CRS Recovery, Inc. v. Laxton, 2010 U.S. App. LEXIS 7050 (9th Cir. Cal. Apr. 6, 2010)
[xxii] Cable v. Sahara Tahoe Corp., 93 Cal. App. 3d 384 (Cal. App. 2d Dist. 1979)
[xxiii] Bernhard v. Harrah’s Club, 16 Cal. 3d 313 (Cal. 1976)
[xxiv] Am. Bank of Commerce v. Corondoni, 169 Cal. App. 3d 368 (Cal. App. 2d Dist. 1985)
[xxv] Cable v. Sahara Tahoe Corp., 93 Cal. App. 3d 384 (Cal. App. 2d Dist. 1979)
[xxvi] Ferren v. General Motors Corp. Delco Battery Div., 137 N.H. 423 (N.H. 1993)
[xxviii] Hernandez v. Burger, 102 Cal. App. 3d 795 (Cal. App. 4th Dist. 1980)
[xxix] Jagers v. Royal Indem. Co., 276 So. 2d 309 (La. 1973)
[xxx] Schultz v. Boy Scouts of Am., 65 N.Y.2d 189 (N.Y. 1985)
[xxxi] Issendorf v. Olson, 194 N.W.2d 750 (N.D. 1972)