Daniel B. Listwa (Wachtell, Lipton, Rosen & Katz) and Lea Brilmayer (Yale Law School) have posted Jurisdictional Problems, Comity Solutions: Lessons for the Restatement (Third) on SSRN:
American choice of law is today portrayed as a story of how a more modern and functionalist methodology came to overthrow the long dominant territorial system. Against this background, the situs rule—the territorial rule requiring that all property-related issues be governed by the law of the jurisdiction in which the property is located—is seen as an unusual straggler of a now-debunked theory. Central to this narrative is the idea that the vested rights theory, which was embraced by the Restatement (First) of Conflict of Laws and assumed away the possibility for overlapping jurisdictions, represented “traditional” choice of law, going back to Justice Joseph Story, the father of American conflicts law. This is the perspective adopted by the now-in-the-works Restatement (Third), which aims to usher in a new era for American conflict of laws by cutting out all vestiges of the “traditional” model—the situs rule included.
But this narrative, while broadly held, is wrong. It is a mistake to associate choice of law during the early Republic with an early twentieth-century model of territorialism. In this Essay, we explain that the early American choice-of-law model, as described by Justice Story, was not territorial, but rather intensely functional, with its prime focus being resolving the uncertainty created by the constitutional law governing the limits of personal jurisdiction and the recognition of sister-state judgments. In this context, the persistence of the situs rule appears to be not an anachronism but rather an indication that “modern” choice-of-law theories misunderstand the forces shaping conflict–of–laws doctrine today. Using the situs rule as a window into the foundations of choice of law, this Essay thus calls into question the standard narrative underlying contemporary choice-of-law literature and challenges the approach of the proposed Restatement (Third).
The article is forthcoming in the Texas Law Review.
A very interesting development, indeed. I would very much like to read the forthcoming article, as the debate concerning the application of the lex situs conflict of of laws rule, or another choice of laws rule, is still alive in regard to international commercial transactions as well. More specifically, as to date there is no consensus concerning one, or more, appropriate conflict rule(s) covering the validity and enforcement of international aviation financing (security interests, mortgages, pledges, charges and other consensual proprietary rights.) and leasing agreements (ownership, mandatory title shift of very expensive aircraft engines being attached to airframes, is an aircraft real property like a house or not, etc.). For example, should the lex situs, lex libri siti, lex registrationis or another conflict of laws rule be applied. Possibly, this article may also play an important role to solve existing issues and facilitate these international transactions.