03 March 2012 Written by  Araya Kebede and Sultan Kassim

Development of Conflicts Theories: General

For the past has yielded an astonishingly rich accumulation of ideas, which still guide the present theory and practice, glimpse to that is very important. There was an early working out of necessary principles of international coexistence and intercourse, primarily on the commercial place. In effect, lending a time to its discussion is, the writers think, worthy.

When was the technique of conflicts invented? Next, a chronology of relevant conflicts development follows.

Since centuries one can learn from conflicts literature that devising theories and approaches of conflicts trying to address problems that inevitably arise because of the laws' differences have been evolving. The focus was mainly on choice of law problem-solving and little attention was given to problems of jurisdiction and recognition and enforcement of foreign judgments.


  • The Origin

 

Generally, in the ancient world, the treatment of foreigners was different from those of citizens. Outstanding instances of this type mentioned by Prof. Yntema, in addition to arbitration of international disputes, are: special courts for cases involving foreigners in the Greece cities of the Hellenistic period and the praetor peregrinus (judge for foreigners) in the Roman Republic after the archaic recuperates __ a board consisting three or five members, originally only for processes between Romans and peregrine (foreigners), but subsequently for cases in general which required a speedy decision, esp. in suits concerning property and de statu. Instead of the jus civile, the "general principles of law common to all nations” was applied. In a related history, contracts between Greeks and Egyptians, if concluded in Greek form, was to be tried before the Greek courts; if in Egyptian form, before the native courts in accordance with the law of the country.However, these situations can hardly enable us to conclude that there was a choice of law process at that time. Rather the focus seemed on jurisdiction though the jurisdiction's local law was thereby immediately applied.

Showing the influence of this history in later stages, it was said in a summarized manner that the Roman conception of a universal corpus juris pushed the problem into the background though it came to the fore again with the resurgence of commerce in the autonomous Italian city states of the Middle Age, and it took a vigorous new turn in the 17th century the Netherlands "envisioned by the jealous separatism of seven individualistic provinces.”


  • · The Statutory Intent

In Northern Italy and Southern France, the then scholars in the 11th- 13thC preferred to tackle the problem of choice of law in a conceptualist rather than a teleological fashion, in the sense that instead of looking for substantive solutions, they theorize about the spatial reach of local laws.

It is generally agreed that the conflicts of laws as we know today is claimed to have begun emerging in the early part of the 13th century in Italy when the local rules statuta, which differ from city to city and when the need arose to make choices in their application as a transaction or relationship bore a connection to more than one locality.Scholars began to discuss whether local statuta could be applied extra-territorially to citizens abroad, and whether foreign citizens within the forum's territory were bound by its laws. In other words, the statutists attempting to determine which law governs transactions involving residents of other city-states classified the laws in a more formalistic way as "real" and "personal". Real statutes in the main concerned (real) property and were territorial in application; personal statutes concerned such questions as capacity, followed the person and thus had extraterritorial effect.

Despite its immeasurable achievement in progress in that it gained wide acceptance, the theory has suffered a great problem in its application. The results of scholars’ attempts to find a basis for distinguishing between personal and territorial (or "real") statutes were disappointing. Its simplicity was belied by the difficulties experienced through out its history in allocating any particular legal transaction to its proper statute.

How can one differentiate whether one statute is real or personal? The great Bartolus took the position that the wording of the "statute" may determine its reach. He employed a very superficial test. To explain more, he tried to make a distinction on the basis of the grammatical construction of the statute and based on that he classified the same as real if the thing is mentioned first and as personal if persons occupy the first place. The famous example is: if a law provides that "the possession of deceased person shall pass to the first born," the lex rei sitae would apply. But, if it were to read "the first born shall succeed," there might be difference in their consequence for the statute would then be personal rather than real.

The spatial reach of a statute cannot be told by its wording. After all, the wording of a law statute does not necessarily reflect the policy of same.

Although the criteria propounded by his successors, the statutists, were no better; the latter writers mocked Bartolus' reliance on the mere "shell of words". Similarly, d'Argentrè severely criticized his verbal distinction via his sarcastic statement that "children would blush if they were to think or say such things".

In this connection, the French statutists distinguished statutes mainly between "substance" and "procedure" and focused on the power to create rights and obligations, i.e. legislative jurisdiction, which was said not to exist locally in the case of a foreign citizen.

Before proceeding to other discussions, let us wind up with the Italians work. As Frederick Juenger has put it rightly, the flourishing trade and commerce of upper Italy also promoted the development of a law of merchant - lex mercatoria. The lex mercatoria, which Mait-land called the "private international law of the middle ages," offered supranational solutions to what have since become choice of law problems.

  • · The Party Autonomy

During the 16th century, the most important development in the statutory doctrine was introduced by the great French jurist Du Moulin just in a modified manner. Without rejecting the Italian division into statutes as real and personal, he rendered a distinct contribution to the discipline by strongly emphasizing on party autonomy.

By distinguishing three principal categories in the subject matter to which statutes may apply; the mere procedure and form of acts, questions affecting the merit that are dependent upon the will of the parties, and substantive questions not dependent on the will of the parties; he declared the intent of the contracting parties, express or tacit, to be a source of law that in its sphere of application transcends the mere authority of a statute as such, limited to its territory.

In other words, Juenger noting that Du Moulin did not invent the idea that those who enter into an agreement may stipulate the law that governs their bargain; emphasized his (Du Moulin’s) adding a new imprudent to the discipline by stretching the principle of party autonomy to encompass situations in which the parties had failed to designate the applicable law. By the way, unlike d'Argentrè, Du Moulin favoured the extension of the personal statute to a wider range of legal relations. This is further explained below.

In the same century, for the simple but broad scheme of classification of Italian statautists as real and personal failed to satisfy the intricacies or realities of life, law, and scholarship; the French Judge and Scholar d'Argentrè identified a third class of statutes - "mixed statutes". He identified such to solve "mixed" questions, which require rules, when relationships had contact with different communities even from the beginning (for instance, when a contract was concluded between citizens of different city-states).    

Preference was being given to the "real" element in the application of "conflicting" mixed statutes. D'Argentrè’s emphasis of the predominance of real statues, reflecting his strong Breton feudal tradition in resisting personal statute extension, favored territorialism. This shows us that statutist theory, envisaging "international" and "universalistic" system, accepted implicitly the premise that one unit, among the territorial governmental units, has the power to legislate with extraterritorial effect subject only to another's ability to block that effect through adoption of an overriding real statute. The major shortcoming of the universalistic system was its failure to explain why one should import the other's law.

Professor David Cavers observed the statute theory's trouble that neither judges nor scholars could agree upon which statute was personal, which was real, and what should be done with those were mixed. Especially, the introduction of the last – mixed statutes- is interesting. Let alone filling any gap it made things worse by complicating matters further. Moreover, when the laws of two states are relevant in the same case, one of them may classify a given issue as personal while the other as real.

  • · The Location of Legal Relation

The death-blow to the surviving schools of statutists appears to have been dealt by Wächter, a German jurist writing in the 1840's. In a lengthy essay, he criticized the uncertainty inherent in the classification of statuta and, more importantly, denied that a state's legislative jurisdiction within its own territory could raise an obligation in another state to recognize such legislation extraterritorially.

The criticisms of Wächter were followed by his contemporary in mid-century by the work of the great German Romanist, Karl von Savigny, who achieved the important shift of focus from classification of rules to ‘consideration of legal relationships’. As Caversput it, Savigny did not seek for solutions to choice-of-law problems in the classification of local statutes rather he sought to find a proper seat for each legal relationship in its connection with a given state whose law would thereby be rendered applicable, whatever its terms.

Savigny devised such a mechanism hoping that wide spread international agreement might be achieved as to the localization of these relationships.The idea of universal principles of conflicts law, a reflection of the universal idea of reason reached its highest point in his time. However, for Savigny's daring premise __ existence of universally accepted conflicts rules and categories of legal systems __ is unattainable due to various reasons. The view is at present subject to modifications.

  • · The Vested-rights

The vested-rights theory was propounded by A.V Dicey in England and by J.H Beale, the reporter of the American Law Institute's First Restatement of the Conflict of Laws, in the U.S. Their formulation was essentially similar. While the former formulated that any right which has been duly acquired under the law of any civilized country is recognized and, in general, enforced by the forum courts, and no right which has not been duly acquired is enforced or, in general, recognized by the forum courts; Beale's formulation runs like this": a right having been created by the appropriate law, the recognition of its existence should follow everywhere, and thus it logically follows that an act valid where done cannot be called in question anywhere. This is not, however, without flaw.

W.W. Cook along with his "Local Law theory" __ which denies that the forum accords extraterritorial effect to a foreign created right but grants a local remedy which approximates the result which would have obtained under the foreign law __ reacted against Beale, at least in its underlying premises and orientation. The shortcoming of the doctrine is that it does not put a proviso to the effect that certain values of the forum might not be sacrificed while recognizing a foreign acquired right.

  • The Transition: “Modern" Developments of Choice of Law Theories

Lex fori approach and governmental-interest or simply ‘interest analysis’ theory, which both reflect attitudes similar to those of the European statutists of the 14th-16th, resulting from the dissatisfaction with the fixed and thus mechanical (but predictable and certain) rules are recorded in American conflicts law as marking a "revolution". The former, the lex fori, theory is of A.A Ehrenzweig’s and that of the latter is B. Currie's.  Both regarded as neo-statutists for returning to an essentially locally-oriented approach which the European development since Savigny had largely overcome. Besides these, von Mehren and Trautman, in part, proceed from a classification and evaluation of forum and foreign law qua law. Both theories resemble in practical results. Let us see them one by one.

  • · Lex fori and Governmental-interest Approaches

The Lex fori (law of the forum or local law) theory contends that the basic law is the law of the forum and that foreign law should be used only to fill "gaps" in that law. This theory does not deny the application of foreign law in "appropriate" cases. In other words, to soften the strict application of the lex fori, some specific conflict rules have been developed as an exception. Foreign law is to be employed only where the defendant would be dealt with unfairly by the application of the lex fori or where the superior governmental interest of another state requires the displacement of the lex fori. In both cases, however, forum's public policy is to be maintained at any rate.

A central theme in Ehrenzweig's approach is the oft-stated contention that traditional conflicts theory erroneously presupposes the existence of a "super law" which predetermines, through direction or restraint, applicable choice of law rules. His problem lied in insisting on government policy analysis, so far as determining whether the substantive rules of the forum are to be "displaced" in addition to formulating new choice of law rules __ if non-existent.

On the view that every state has a governmental interest in effecting the policies underlying its own law having some connection with the transaction, Currie's extreme position (accepting the lex fori principle) was: "we would be better off without choice of law rules. Normally, even in cases involving foreign elements, the court should be expected as a matter of course to apply the rules of decision found in the law of the forum".Upon consideration of policy and fairness in determination of the matter, despite the position that the forum must enforce its own interest and apply its law where there is a conflict between the government interest of the forum and that of another state; the law of the forum could be displaced if where another state is shown to have a government interest superior to that of the forum which in this case the law of that state will be used as a model for the rule of decision in the particular case.

It is during the inquiry of the policies expressed in the respective laws that one encounters concepts of "true" and "false" conflicts. Maintaining that there is no conflict upon an examination of government interests (for it is only one state that will have any interest in having its law applied) Currie has come up with the mentioned analytical concepts and another "disinterested" position principle.

While a "false conflict" exists when the potentially applicable laws do not differ or when, upon examination, one law __ by its own terms or underlying policies __ is not intended to apply to a situation such as the one in issue; a "true conflict" appears when the relevant laws not only differ, but the underlying policies of each call for its application. In the latter case, the court considers whether a more moderate or restrained interpretation of the policy or interest of one state may avoid the conflict and it is in the case of an unavoidable conflict that the forum's law that is believed to advance governmental-interest is to be applied.

Scoles and Hay noted that for the actual resolution of cases, the distinction between "false" and "true" conflicts is irrelevant for Currie's analysis will always regardless of whether the case involves "false" or "true" conflict, lead to application of forum law except in those cases in which the policy of the forum does not call for the application of its law, that is where it is "disinterested" in which case (a very rare occurrence) the conflict could be avoided either through the doctrine of dismissal of the local suit __ or, still, by application of local law at least if the latter corresponded with the law of one of the interested states.  Hence, "All Roads Lead Homeward".

  • · Functional Analysis (Policy Weighing Approach)

By broadening Currie's analysis and approach, many American writers, such as von Mehren and Trautman, share his forum concern to solve true conflicts problems. What is different here is that unlike Currie, they employ a principled weighing of conflicting policies to resolve a problem in case self conflicts analysis or determination of concerned jurisdiction fails. The following are some:

- The choice of the state's law whose polices are most strongly held;

- The choice of the law reflecting an "emerging" policy over one embodying a   "regressive" policy;

- The choice of a law expressing the more specific rather than general policy;

- Selection of the rule best designed to effectuate an underlying policy; and

-Avoidance of a choice which would frustrate an underlying policy.

But, what if the method of policy weighing fails to solve the problem? The formation of multi-jurisdictional rules as a solution was urged. Here, the analysis seems to take on a slight local-law orientation, in the sense that the formulation of universally-applicable choice of rules, not based on interest analysis, is seen as exceptional, and when the exception does not obtain, the court is said to be justified, which logic indeed requires, in giving up and applying its own law.

Despite coming with additional of more articulated criteria for choice and being concrete in identifying the relevant criteria, Weintraub's weighing approach may not lead, in practice, to results that differ from the above mentioned four scholars' approaches.

The Value-Oriented Approaches

The quest for a better alternative to the ‘rigid’ traditional choice of law rules has continued. As will be seen below, some scholars are known for their essentially common character approaches in trying to identify “goals and objectives"that help courts in devising new rules. Such methods, however, are criticized as "result-selective" which are contrary to the intended objectives of traditional conflicts law (decisional harmony or uniformity of result, predictability, and certainty).

Prof. David Cavers suggested the consideration of the following "principles of preference" in case of resolution of conflicts problem with the object that "the choice ... would not be the result of the automatic operation of a rule or principles of selection but of a search for a just decision in the principal case. The principles are:

- Close analysis of the facts of the case;

- Comparison of the "preferred rules of law" with "the rule of the forum (or other competing jurisdiction's) with respect to the results they would entail; and

- Appraisal of the result "from the stand point of justice between the 'litigants' or ... broader considerations of social policy."  

In similar fashion to Caver's "look-before-you-leap " type approach, R.A. Leflar offered a list of general "five-choice-influencing considerations", viz. 1) predictability of results; 2) maintenance of inter-state and international order; 3) simplification of the judicial task; 4) advancement of the forum’s governmental interest; and, 5) the application of the better rule of law.

Although he failed to put the criteria in hierarchy or order of priority, Leflar advised courts to replace the "mechanical rules" (traditional method) and "circuitously devised approach" which have appeared as cover-ups for the real reason that underlay the decisions with "statements of real reason".One can observe that some of the criteria lie opposite to each other. For example, while simplification of the judicial task promotes societal interests, the "better law" suggestion, which has become the focal point of the criticisms of his approach, in contrast tilted towards results keyed of the given case.

In summation of this approach, it is commented that while Leflar's is largely undifferentiated and open-ended, Cavers' is mindful both of the need for certainty provided by rules and the need for an adjustment mechanism.

The Second Restatement of Conflict of law (American's) reported by Prof. W. Reese, containing three main elements __ general policy consideration, the concept of the "most significant relationship", and lists of particularized connecting factors __ attempting to provide as much of the "right line between excess of rigidity (the Bealian dogma) ... and excess of flexibility", which most approaches and analyses since the First Restatement were trying to attain besides seeking a formula for the application of foreign law in appropriate cases is worth mentioning here.

In choosing the applicable law, the general policy consideration section of the Restatement Second provides set of factors which lack, like Leflar's list of choice influencing-considerations, "order of priority" and with a possibility of rules pointing to different directions in a given case __ that the court considers in the absence of a statutory directive of the forum, which the court is required, first and foremost, to follow to the extent that it is constitutional.

It is to be appreciated of the conflicts scholars' intellects that have contributed to the prolific literature devoted to solve the problems of the discipline; what is the ultimate solution found at present? Unfortunately enough, today there exists extreme disagreement among both judges and commentators not simply over the details of choice of law policy but even over the most fundamental principles of the subject. These, esp. the latter, allegations are opposed by others who assert that the subject now enjoys the status of a "normal science" in which scholarly consensus on the fundamentals prevails.

Last modified on Wednesday, 02 May 2012 13:05