Conflicts Class Notes: 10 MAR 2014

  • Exam note: we will not do second rest. because the analysis is too long, involved, and/or convoluted
  • 2d Rest. Is merely a poor form of interest analysis
  • A little less than half of jurisdictions are 2d Rest. jurisdictions
  • Recap
  • Moderate/Restrained interpretation: using party expectations to narrow forum’s own interpretation of its interest to turn true conflict into a false one
  • Different from comparative impairment which is about resolving true conflicts
  • Second Restatement
  • Background
  • Basically modern approach, concerned with interest analysis, but vague
  • Uses presumptive rules, but then provides alternative provision for most significant relationship analysis
  • Presumptive rules are sometimes ignored, sometimes considered irrebuttable
  • Green: The court should be trying to figure out what state is most interested; if can’t figure it out, it should then fall back on the presumption
  • Principles of § 6
  • Follow statute, if applicable
  • In absence of statute, then look to listed (and other) factors
  • Issues:
  • Confusion because the 2d Rest.tries to throw in everything; some factors resolve true conflicts, some try to identify false conflicts, but the rules don’t distinguish which are doing what
  • If a true conflict exists, the 2d Rest. doesn’t prioritize which factor is most important
  • Specific rules
  • Identify in specific context what to consider to determine which is the most interested state
  • Issues:
  • Rules are generally vague
  • Some make predictions of which law will “usually” apply, but it is unclear what role these statements are making
  • ex: tortious conduct, intra-family immunity
  • Broader issue is that often three different provisions could be relevant:
  • Presumptive rules
  • § 6 factors
  • Specific rule provisions
  • Phillips v. General Motors Corp. (Mont. 2000)
  • Poorly written opinionbecause the court follows § 6 guidelines
  • Facts: Truck bought in NC by NC residents (at the time) who subsequently move to Mont.; driving to Mont. have accident in Kansas, suit against GM (Michigan) based on products liability theory, certification to Mont. supreme court to determine what law applies (NC, Mont. Kansas, or Mich.?)
  • Question one is whether Mont. follows the traditional rules or 2d Rest.for torts
  • (In the year 2000?! => proof Mont. has no law)
  • Note: ~ 3000 conflicts opinions every year (when conflicts issue actually adjudicated)
  • Mont. uses Rest. 2d for contracts, figure they might as well use it for torts also
  • Applying the 2d Rest.
  • Presumptive rule: law where the injury occurs - Kansas
  • Mont. ignores the presumptive rule and delves straight into most interested state analysis instead
  • Proper application?
  • Use presumptive rule unless clear and convincing other law applies, or determine what law applies and use presumptive if unclear (Prof. approach)
  • Starts with 6(2)(a)
  • the needs of the interstate and international systems,
  • On the facts of this case, this factor does not point toward the importance of applying any particular state's law. Rather, this factor supports the application of the Restatement approach, namely the law of the state with the most significant relationship to an issue. We believe the Restatement approach fosters harmonious relationship between states by respecting the substantive law of other states when those states have a greater interest in the determination of a particular issue litigated in a foreign jurisdiction. The Restatement approach is preferable, in our view, to the traditional lex loci rule which applies the law of the place of the accident which may be fortuitous in tort actions.
  • Circularity: 6(2)(a) ismeant to determine what the MIS is
  • Should be independent issue aside from general appeal to MIS
  • Pity the Mont. court, for they have launched into analysis without determining whether a true conflict actually exists
  • States’ laws analysis
  • Kansas has pro-defendant laws: cap on punitive damages, comparative fault, etc.
  • Kansas also has better available defenses for GM, providing for no liability if the product past usage date, if IAW regulations applying to manufacturer at the time
  • NC: little information on NC law, apparently does not have strict liability
  • Court points to the fact that as a 1st Rest. state NC would not apply its own law regardless
  • Mont.: tort law, strict liability, but no caps on damages
  • Mich.: no clue, no brief or evidence in record; yet the court still evaluates whether Mich. is interested?!
  • Why no evidence?
  • GM silent probably because Mich. law disadvantageous
  • Each state could Const. apply its own law, probably sufficient contacts
  • Probably not improper to choose between the available states’ laws, amounts to consent
  • Justified expectations => doesn’t matter in a tort case
  • Is that true?
  • GM might have expectations, but the court concludes that such expectations would not be justified considering the nature of the product (i.e. cars move around)
  • But other considerations might justify certain expectations
  • Hypo: if VA had no tort law => this would weigh heavily in your determination to go to VA or not
  • People don’t choose to have accidents, but can choose to subject themselves to risks in certain states
  • Basic policies of the law
  • It is more reasonable to apply law that upholds basic policies of the particular field of law
  • Recall: better to uphold the standard rule rather than a deviant/quirky rule
  • Applying the “normal” law probably won’t frustrate the outlier state’s interests much, whereas applying the deviant law will vindicate the outlier’s interests at the expense of the normal state’s law, or the more commonly applicable law
  • Better serves predictability, uniformity
  • Note: also applies to choice of law between substance and procedure
  • Court concludes this principle irrelevant
  • Prof. finds it relevant to choice between normal Mont. law and deviant KS law
  • Point: none of these issues perform work aside from relevant policies of the forum => the court is merely doing interest analysis
  • States’ interest:
  • Kansas?
  • Laws not applicable to products not sold in Kansas, not sold to Kansas residents
  • Seemingly interested only in the particular Kansas laws that are pro DEF, applicable only to Kansas transactions because these are felt in Kansas (costs, liability)
  • Distinguish Comp fault? Why would they want to apply this to accidents in Kansas?
  • Concerns conduct in Kansas
  • Kansas would want to impose view of distribution of liability for accidents/wrongdoing that occurs within Kansas
  • NC?
  • Don’t know much about NC law, but know that NC wouldn’t apply NC law because they are a 1st Rest. state
  • Not renvoi (NC court would apply KS law, they aren’t applying KS law), but desistment
  • Wont apply NC law because NC wouldn’t apply NC law
  • Able to make determination w/o any idea what the law is other than its a 1st Rest. state
  • 2d Rest. does not say you can/cannot do this
  • Always make an argument if you can, not sure what will stick
  • Distinction between the forum not interested in applying its law vs. forum interested but applying another, more interested state’s law
  • Mich.?
  • No evidence of Mich. law, but conclude products liability law regulates sale of finished products within the state of the transaction, not the design/manufacturer state’s law
  • Territorial scope argument
  • Mich. law not meant to apply outside of Mich., Mich. courts do not apply Mich. law to these types of case thus Mich. not interested
  • Should 1st Rest. and interest analysis jurisdictions be treated differently?
  • If Mich. indicated it was not interested, pretty good evidence that Mich. is not interested (as opposed to 1st Rest. state’s mechanical application, which does not indicate its particular interest in the case)
  • Desistment-type trick
  • Race to the bottom argument
  • One state could capture business by lowering liability
  • Court seeks to discourage such behavior by not appealing to law of state of manufacture
  • Mont.
  • Interested in compensation to residents even if dead, even if orphaned and have moved back to NC
  • Not surprised at the outcome, but not clear that the second restatement was helpful in getting there
  • Public policy exception
  • Only relevant if some other states law applies
  • Court concludes not relevant when 2d Rest. adopted, subsumed in most significant relationship approach
  • court is correct that bastardized public policy exception, which is a veil for interest analysis used by 1st Rest jurisdictions, is not needed in 2nd Rest jurisdictions
  • BUT there is still a reason for a 2nd Rest jurisdiction to use the pure public policy exception: dismissal for lack of jurisdiction when law offensive
  • Wood Bros. Homes v. Walker Adjustment Bureau
  • Facts: Gagnon and Wood Bros. enter into K for building in NM; NM has law against contractors building w/o license, and Gagnon is barred from completing construction; Woods cancels K, pays employees but not Gagnon for work performed; Gagnon assigns interest to another party who then seeks recovery for breach of K or quantum meruit
  • 1st Rest. analysis: place of performance most likely for damages resulting from failure to perform
  • Why not take domicile into account?
  • Parties could create state interests by assigning interest to the domiciliary of a particular state
  • Big mistake: no CoL provision
  • Presumptive Rule
  • § 188 factors
  • Place of performance, place of K, place of negotiation, location of subject matter, domicile, residence, nationality of parties
  • Not much to say: appellate court looks to CO law, relying on rule of validation to uphold party expectations, but CO supreme court relies on the strength of NM interests instead to justify using NM law
  • NM interested in not having unregistered contractors, regardless of quantum merit, etc.
  • CO doesn’t have same rule, seeks to uphold expectations
  • Point: 2d Rest. doesn’t suggest how much weight to give the various factors
  • Leflar: Choice Influencing Considerations
  • Realist argument: this is what courts do, be straightforward about how/why they are doing it
  • Milkovich v. Saari
  • ONT (guest §) residents, accident in MN (no guest §)
  • Remember Kell v. Henderson: NY applied NY law rather than ONT guest §, which was justified because NY interested in law applying to deter negligent driving in NY
  • Note: NY would now apply ONT law because it is a loss allocating rule and P and D have same domicile
  • Leflar considerations:
  • Predictability: not interested in torts cases (not necessarily true, as mentioned above)
  • Maintenance of interstate order: basically a false conflict analysis, don’t apply law of state not interested
  • Simplification of judicial task: only relevant in procedural cases
  • Forum interest: Court appeals to MN’s interest as a “justice-seeking state,” although a deterrence argument probably makes more sense
  • If MN has parties who have had an accident, MN has interest in distributing justice
  • Broad understanding of a state’s compensatory interest
  • Choosing better law: MN law applies because the court is convinced the common law approach is better than ONT’s silly guest §, rationales for the guest § do not justify its application
  • Incorporating into comparative impairment approach:
  • Considerthe way a law is drafted;if applying the law would not vindicate the purpose of the law then failing to apply law cannot frustrate those purposes
  • If law doing terrible job at achieving purpose, failure to apply it is justified
  • Can use similar argument in comparative impairment states and 2d Rest. states to achieve state objectives
  • Court concludes purpose of the law is unreasonable
  • Courts are perfectly capable of identifying collusive suits
  • Also note that a long time has passed since guest § enacted
  • Concern with preference for forum law (Currie-approach)
  • No empirical evidence that these jurisdictions prefer forum law
  • Side note: it gets better, but not until we finish best law approach, NY approach…