Academy of American and International Law. Related Doctrines

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1 Academy of American and International Law International ti lcivil il Litigation in U.S. US Courts ChoiceofLaw of Law, Enforcement ofjudgments Judgments, and Related Doctrines Original PowerPoint by Carlos Soltero, Esq. McGinnis, Lochridge & Kilgore Austin, Texas Revised by Prof. Stephen Zamora

2 Preview Choice of Law Issues Summary of discussion (3 parts) 1. American choice of law concepts (Texas) (focus on contracts & torts civil obligations) 2. Proof of Foreign Law 3. Enforcement of Foreign Judgments 2

3 Choice of Law Why do you care? 1. Causes of action a. Common law background for torts 2. Elements of legal doctrines 3. Defenses 4. Measure of damages a. Liberal jury awards (pain & suffering, etc.) b. Punitive damages c. Limitations on awards 3

4 Key characteristics of American Choice of Law 1. Judge made law versus legislative enactment 2. Vigorous nature of federalism and importance of state legislation make choice of law rules important and complex 3. Importance of academic writings and theories 4. Role of the American Law Institute (ALI) 4

5 Old Rules Lex loci delicti, lex loci contractus Virtues Simplicity Predictability Stare decisis/tradition Problems unfairness, fi rigidity iidit Ignored interests of forum Ignored interests of parties Even under old system, exceptions created Geographical dispute over where an event occurred (products liability) 5

6 Lex loci abolished case law Gutierrez v. Collins (Tex. 1979) Texas international case; based on domestic law like other states (Babcock) Car accident in Chihuahua, Mexico between 2 El Paso residents; suit in Texas Abolished lex loci delicti in TX» Place where wrong occurred no longer occupies such a position of esteem» Statutory t t language» Trend among states (clear trend now almost all) Alternatives:» A. Governmental interests» B. Functional approach» C. Principles of Preference» D. Choice influencing considerations» E. Better law» F. Restatement most significant relationship Abolished dissimilarity doctrine» Translations» Public policy Duncan v. Cessna (Tex. 1984) confirmed in contracts 6

7 Torts Choice of law Restatement 2nd 6 s 6. CHOICE OF LAW PRINCIPLES TEXT (1) A court, subject to constitutional restrictions, will follow a statutory directive of its own state on choice of law. (2) When there is no such directive, the factors relevant to the choice of the applicable rule of law include (a) the needs of the interstate and international systems, (b) the relevant policies of the forum, (c) the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue, (d) the protection of justified expectations, (e) the basic policies underlying the particular field of law, (f) certainty, predictability and uniformity of result, and (g) ease in the determination and application of the law to be applied. 7

8 Choice of Law Restatement 2 nd TORTS (CONT.) Section 146. 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, with respect to the particular issue, some other state has a more significant relationship under the principles stated in Sec. 6 to the occurrence and the parties, in which h event the local llaw of the other state tt will be applied. Section 145. THE GENERAL PRINCIPLE (1) The rights and liabilities of the parties with respect to an issue in tort are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties under the principles stated in s 6. (2) Contacts to be taken into account in applying the principles of s 6 to determine the law applicable to an issue include: (a) the place where the injury occurred, (b) the place where the conduct causing the injury occurred, (c) the domicil, residence, nationality, place of incorporation and place of business of the parties, and (d) the place where the relationship, if any, between the parties is centered. These contacts are to be evaluated according to their relative importance with respect to the particular issue. 8

9 Choice of law Restatement 2nd Contracts Section 187. LAW OF THE STATE CHOSEN BY THE PARTIES (1) The law of the state chosen by the parties to govern their contractual rights and duties will be applied if the particular issue is one which the parties could have resolved by an explicit provision in their agreement directed to that issue. (2) The law of the state chosen by the parties to govern their contractual rights and duties will be applied, even if the particular issue is one which the parties could not have resolved by an explicit provision in their agreement directed to that issue, unless either (a) the chosen state has no substantial relationship to the parties or the transaction and there is no other reasonable basis for the parties' choice, or (b) application of the law of the chosen state would be contrary to a fundamental policy of a state which has a materially greater interest than the chosen state in the determination of the particular issue and which, under the rule of s 188, would be the state of the applicable law in the absence of an effective choice of law by the parties. (3) In the absence of a contrary indication of intention, the reference is to the local law of the state of the chosen law. 9

10 Choice of law Restatement 2nd Contracts (cont.) Section 188. LAW GOVERNING IN ABSENCE OF EFFECTIVE CHOICE BY THE PARTIES (1) The rights and duties of the parties with respect to an issue in contract are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the transaction and the parties under the principles stated in s 6. (2) In the absence of an effective choice of law by the parties (see s 187), the contacts to be taken into account in applying the principles p of s 6 to determine the law applicable to an issue include: (a) the place of contracting, (b) the place of negotiation of the contract, (c) the place of performance, (d) the location of the subject matter of the contract, and (e) the domicil, residence, nationality, place of incorporation and place of business of the parties. These contacts are to be evaluated according to their relative importance with respect to the particular issue. (3) If the place of negotiating the contract and the place of performance are in the same state, the local law of this state will usually be applied, except as otherwise provided in ss and

11 Choice of law & forum selection clauses Forum selection clauses are generally enforceable US Supreme Court decisions due process considerations Texas In re Int l Profit Associates, Inc. (Tx. Jan. 2009)» To avoid enforcement, must show special and unusual circumstances after contract formation that now make it so gravely difficult and inconvenient that person would for all practical purposes be deprived of its day in court Uniform Commercial Code Sec (California version ) (a) Except as otherwise provided in this section, when a transaction bears a reasonable relation to this state and also to another state or nation, the parties may agree that the law either of this state or of the other state or nation shall govern their rights and duties. (b) In the absence of an agreement effective under subdivision (a), and except asprovided in subdivision (c), thiscode appliesto transactions bearing an appropriate relation to this state. 11

12 Proof of Foreign law Federal v. state (Texas) procedural differences Texas law presumes that the laws of other jurisdictions arethe same No substantive? Klaxon Conflicts with federal laws (not diversity) COGSA, Carmack Differing i interpretations? i 12

13 Proof of Foreign law Traditional rules use of expert witnesses to establish foreign law as a factual matter to be proven by the party alleging foreign law Modern approach foreign law is a question of law, not fact Federal Rules of Civil Procedure Rule Determining Foreign Law A party who intends to raise an issue about a foreign country's law must give notice by a pleading or other writing. In determining foreign law, the court may consider any relevant material or source, including testimony, whether or not submitted by a party or admissible under the Federal Rules of Evidence. The court's determination must be treated as a ruling on a question of law. Practical considerations Court appointed experts 13

14 Enforcement of judgments General Enforcing sister state judgments Full Faith & Credit Issues in sister state enforcement Gambling Untraditional marriage Usury 14

15 Enforcement of judgments Aside Enforcement of Foreign Arbitral Awards New York Convention on Recognition and Enforcement of Foreign Arbitral Awards Enforcing foreign country judgments Constitutional considerations Lack of treaties to which the United States is a party Comity 15

16 Enforcement of Foreign Judgments Principal substantive grounds for non recognition of foreign judgments Penal judgment rule Lack of jurisdiction Lack of service of process UNIFORM FOREIGN MONEY JUDGMENTS RECOGNITION ACT SECTION 1. [Definitions.] As used in this Act: (1) foreign state means any governmental unit other than the United States, or any state, district, commonwealth, territory, insular possession thereof, or the Panama Canal Zone, the Trust Territory of the Pacific Islands, or the Ryukyu Islands; (2) foreign judgment means any judgment of a foreign state granting or denying recovery of a sum of money, other than a judgment for taxes, a fine or other penalty, or a judgment for support in matrimonial or family matters. SECTION 2. [Applicability.] This Act applies to any foreign judgment that is final and conclusive and enforceable where rendered even though an appeal therefrom is pending or it is subject to appeal. 16

17 SECTION 3. [Recognition and Enforcement.] Except as provided in section 4, a foreign judgment meeting the requirements of section 2 is conclusive between the parties to the extent that it grants or denies recovery of a sum of money. The foreign judgment is enforceable in the same manner as the judgment of a sister state which is entitled to full faith and credit. SECTION 4. [Grounds for Non Recognition.] (a) A foreign judgment is not conclusive if (1) the judgment was rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law; (2) the foreign court did not have personal jurisdiction over the defendant; or (3) the foreign court did not have jurisdiction over the subject matter. (b) A foreign judgment need not be recognized if (1) the defendant in the proceedings in the foreign court did not receive notice of the proceedings in sufficient time to enable him to defend; (2) the judgment was obtained by fraud; (3) the cause of action on which the judgment is based is repugnant to the public policy of this state; (4) the judgment conflicts with another final and conclusive judgment; (5) the proceeding in the foreign court was contrary to an agreement between the parties under which the dispute in question was to be settled otherwise than by proceedings in that court; or (6) in the case of jurisdiction based only on personal service, the foreign court was a seriously inconvenient forum for the trial of the action. 17

18 SECTION 5. [Personal Jurisdiction.] (a) The foreign judgment shall not be refused recognition for lack of personal jurisdiction if (1) the defendant was served personally in the foreign state; (2) the defendant voluntarily appeared in the proceedings, other than for the purpose of protecting property seized or threatened with seizure in the proceedings or of contesting the jurisdiction of the court over him; (3) the defendant prior to the commencement of the proceedings had agreed to submit to the jurisdiction of the foreign court with respect to the subject matter involved; (4) the defendant was domiciled in the foreign state when the proceedings were instituted, or, being a body corporate had its principal place of business, was incorporated, or had otherwise acquired corporate status, in the foreign state; (5) the defendant had a business office in the foreign state and the proceedings in the foreign court involved a cause of action arising out of business done by the defendant through that office in the foreign state; or (6) the defendant operated a motor vehicle or airplane in the foreign state and the proceedings involved a [cause of action] [claim for relief] arising out of such operation. (b) The courts of this state may recognize other bases of jurisdiction. SECTION 6. [Stay in Case of Appeal.] [court may stay proceedings if an appeal is pending in foreign court]. SECTION 7. [Saving Clause.] This Act does not prevent the recognition of a foreign judgment in situations not covered by this Act. [Sections 8 and 9 omitted] 18

7 GCA CIVIL PROCEDURE CHAPTER 52

7 GCA CIVIL PROCEDURE CHAPTER 52 CHAPTER 52 THE UNIFORM FOREIGN MONEY-JUDGMENTS SOURCE: P.L. 32-215:3 (Dec. 29, 2014) added 7 GCA Chapter 52. 52101. Title. 52102. Definitions. 52103. Applicability of Article. 52104. Standards for Recognition