Jurisdiction

As stated above, the first question in an international

case potentially involving conflict-of-laws problems is
which court has jurisdiction to adjudicate the matter.
Although the plaintiff decides where to sue, the courts
in that location may not have jurisdiction, or they may
have jurisdiction but be unwilling to exercise it, for
reasons of forum non conveniens (Latin:
“inconvenient forum”), as may happen in some
common-law countries.
Rationale behind choice of
jurisdiction
There are several factors that affect the plaintiff’s
decision of where to file a case. One is convenience.
For example, a plaintiff is likely to want to sue in a
jurisdiction that is reasonably close to his home,
particularly because witnesses and evidence may be
more readily available there. Legal questions also are
important. A plaintiff may be more likely to file suit in a
jurisdiction that will afford him procedural and other
advantages and where the defendant has assets with
which to satisfy an ultimate judgment. Examples of
likely procedural or substantive law advantages
include the possibility of a jury determination of
damages in a tort case, the availability of punitive
damages, the ease of obtaining pretrial discovery of
evidence (commonly used in the United States), the
possibility of suing on only a part of one’s claim to
determine the likelihood of success before committing
resources to a suit on the entire claim (a common
practice in Germany), and advantageous exploitation
of variations in liability standards.
However, the place of suit is not entirely up to the
plaintiff. The chosen court must have the power to
entertain the case (jurisdiction to adjudicate). The
jurisdictional grant will usually be defined by statute.
In addition, the exercise of jurisdiction may also be
limited (as a check on the statutory grant or on the
judicial exercise of it) by constitutional provisions
or pervasive principles of law. In the United
States this is the function of the due process clause of
the Fourteenth Amendment of the Constitution, which
limits the exercise of the jurisdiction of state courts to
protect defendants against unreasonable burdens.
The Fifth Amendment similarly limits federal courts in
asserting jurisdiction in cases not based on state law.
In addition, in common-law countries, provisions of
law or court decision-making practice may limit the
exercise of jurisdiction to adjudicate for any number of
reasons, including the need to prevent local courts
from becoming clogged with litigation with which they
have no concern (e.g., litigation between foreigners
concerning a claim that arose abroad), especially
when it seems likely that the courts of the forum state
were chosen only as a means of gaining procedural-
or substantive-law advantages not available to the
plaintiff in his home country’s courts (so-called “forum
shopping”). Especially in the United States, courts
may consider themselves to be a forum non
conveniens in these circumstances and dismiss the
action. This occurred in Piper Aircraft v. Reyno, a suit
filed in the United States on behalf of Scottish parties
whose relatives were killed in an airplane crash. The
flight originated in Scotland and was scheduled to end
there; the aircraft was owned by a British entity; the
pilot was Scottish; and all of the relatives were
Scottish. Only the defendants—the airplane
manufacturer (Piper) and the propeller
manufacturer—had a connection to the United States.
Because the plaintiffs sought remedies that were not
available—at least not to the extent desired—
under Scottish law, they decided to bring suit in the
United States, making this a clear case of forum
shopping.
American courts may dismiss for forum non
conveniens when the exercise of jurisdiction would be
unduly burdensome for the defendant. In many cases,
dismissal protects the foreign defendant as much as it
protects the local court from unfair burdens of foreign
litigation. Courts likewise will not entertain actions
concerning title to real property located in another
country; while their judgment would bind the parties
before them, the power to deal with the property itself
(with effect as against all potential claimants) belongs
solely to the country of location (situs).
Civil-law countries generally do not dismiss actions for
reasons of forum non conveniens. The European
Court of Justice has held expressly that the allocation
of jurisdiction by EU law (namely, the Brussels I
Regulation) is binding on national courts. As an
exception, the Brussels II Regulation permits
dismissal or transfer for forum non
conveniens reasons in child-custody cases. (See
below Recognition and enforcement of judgments.)
Each country determines the jurisdiction of its courts
to entertain a civil lawsuit. In federal countries or
unitary systems with strong traditions of regional or
provincial jurisdiction (e.g., the United States, the
United Kingdom, Canada, and Switzerland), it
becomes necessary to have rules to determine in
which jurisdiction a civil suit may be brought. In some
countries (e.g., Germany and Austria) the central
(national) law governs, while in others
the constituent states may determine the jurisdiction
of their courts themselves (e.g., the United States).
Although state-court jurisdiction is a matter of state
law in the United States, federal constitutional law,
particularly the Fourteenth Amendment’s due
process, equal-protection, and privileges-and-
immunities clauses, limits the assertion of state-court
jurisdiction.
Most countries allow the parties to agree to the
jurisdiction of a court. Consent may take the form of
an express agreement in the initial
business contract or at the time the dispute arises.
Alternatively, consent may be the result of conduct.
The plaintiff’s consent appears from the filing of the
action. The defendant’s consent may be presumed
when, rather than objecting to the court’s jurisdiction,
the defendant confesses judgment or appears and
begins to litigate the controversy. Even when both
parties consent to a court’s jurisdiction, the court in a
common-law country may still decline to hear the
case—for example, when neither of the parties nor
the controversy has a connection to the country in
which the court is located. In most cases, however, a
court’s jurisdiction is not an issue unless and until the
defendant objects to it.
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Differences between civil-law and
common-law countries in the
absence of a choice by the parties
Traditionally, civil-law and common-law countries
have followed different approaches in determining
which court has jurisdiction in a civil action when the
parties have not agreed on or submitted to the forum.
Civil-law countries start from the premise that there is
one principal place where a suit can be filed:
the domicile of an individual or the seat of legal
persons such as a corporation (“general jurisdiction”).
In addition to these general bases of jurisdiction, a
suit ordinarily may be brought in the courts of the
place to which the suit has a special connection—
e.g., where a tort was committed or where its effects
were felt, where the alleged breach of a contract
occurred, or, if title to real property is involved, where
the property is located (“specific jurisdiction”).
Increasingly, countries have limited the exercise of
jurisdiction (and have prohibited parties from varying
these limitations by agreement) for the protection of
weaker parties, such as employees and consumers.
Such a pattern has emerged, for example, in
the procedural law of the EU.
Courts in common-law countries, particularly the
United States, also assert jurisdiction on these bases
but additionally will exercise jurisdiction simply on the
basis of physical power over the person of the
defendant. Thus, a court in the United States has
jurisdiction over a defendant if he has been served
with the documents commencing the suit in the
territory of the state in which the court is located, even
if he was there only temporarily or while in transit
(“transient jurisdiction”). The United Kingdom and
Ireland also exercise jurisdiction on this basis. U.S.
law also provides for jurisdiction over a company
when it has been connected in some ongoing way
with the state, even if the particular dispute does not
arise out of that connection. Thus, a court is
authorized to assert jurisdiction when the defendant is
“doing systematic and continuous business” within its
state, even if the dispute arose elsewhere.
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Most countries provide some bases of jurisdiction for
the benefit of local plaintiffs. French law, for example,
grants jurisdiction if the plaintiff possesses
French nationality, and German statutory law permits
a local plaintiff to sue an absent defendant on the
basis of any property the defendant may have in
Germany, regardless of whether the litigation is
related to the property or even to Germany in any
other way (though modern German court decisions
have given provision a more limited reach). Rules
such as these, which favour plaintiffs (“transient
jurisdiction” also falls into this category), are known as
“exorbitant” rules of jurisdiction. Within the EU they
have been abrogated in cases in which the defendant
is habitually resident within the EU. However, EU
member-states may retain exorbitant jurisdictional
bases of national law in cases involving non-EU
defendants. Internationally—i.e., beyond the EU—
these rules, as well as the American “doing business”
jurisdictional rule, are a source of considerable
tension. The Hague Conference on Private
International Law sought to formulate an international
convention on jurisdiction and judgment recognition.
The effort was abandoned when the differences
proved too large to bridge. Instead, a much more
limited convention on choice of court agreements was
adopted in 2005 and proposed for adoption by
member states and others.
Both civil-law and common-law countries have special
rules governing suits for judgments in rem (Latin:
“with respect to the thing”), which
concern proprietary legal rights. Unlike actions for
judgments in personam(Latin: “with respect to the
person”), which concern personal legal rights and
may seek money damages or injunctions to do or not
to do an act, an in rem action seeks a judgment that
produces effects of its own on a legal relationship.
Examples include actions to quiet title to land, to
foreclose a mortgage on land (by selling it), and to
remove a party’s interest that encumbers title to land.
In common-law countries, family-status actions
(e.g., divorce or the creation of an adoptive family-
child relationship) have been likened to in rem
actions; for example, in divorce proceedings,
particularly in the United States, the domicile of each
spouse localizes the status and permits the court at
the domicile to assert divorce jurisdiction. At the same
time, residence of varying length (from several weeks
to several months) may take the place of—or may
presumptively equal—domicile for divorce-jurisdiction
purposes. In contrast, civil-law countries have not
likened divorce jurisdiction to in rem proceedings.
They provide for divorce, including the possibility of ex
parte divorce (i.e., only the petitioner is before the
court), on the basis of a close relationship to the
forum state—e.g., residence of a specified length of
time. Central to the continued divergence of these
jurisdictional approaches is the applicable law: a court
following an in rem approach to status matters will
always apply its own law. In contrast, courts in civil-
law countries treat the action as in personam and
make a choice-of-law determination that focuses on
personal connecting factors such as the nationality or
marital residence of the parties. Because civil-law
courts make choice-of-law decisions with reference to
the particular parties and their case, jurisdictional
standards can be more liberal in those countries than
in common-law countries, where less-restrictive
standards would lead to forum shopping.
Notification of parties
Fundamental fairness requires that the defendant
receive notice sufficient to afford him an opportunity to
defend. In common-law countries this notice is
effected by “service of process” on the defendant;
similar procedures exist in civil-law countries. Service
on the defendant in person is considered ideal;
alternatively, “substituted service” (e.g., even by
publication) is a last resort when the whereabouts of
the defendant are unknown. International cases pose
special problems. Countries often cooperate
bilaterally, either on the basis of express agreements
or as a matter of practice, in aiding each other’s
courts to effect service on the defendant. A very
effective multilateral mechanism is the Hague
Convention on the Service Abroad of Judicial and
Extrajudicial Documents in Civil or Commercial
Matters, to which some 50 countries, including the
United States, China, Russia, and all the EU states,
are party. It provides for a “Central Authority” in each
member state that receives service requests from
other convention states and executes them according
to its own national procedures.

Choice Of Law
In its choice of the applicable law, the court that
exercises jurisdictiondetermines which law to apply to
a case that involves foreign parties, foreign
transactions, or a number of foreign elements. In a
simple world, the court would always apply its own
law, the law of the forum (known in Latin as the lex
fori). Indeed, some modern methodologies,
particularly in the United States, favour the lex
fori approach.
Historical development
Classic theories of conflicts law were territorially
oriented. The German jurist and legal
scholar Friedrich Karl von Savigny (1779–1861)
sought to identify the law where, “according to its
nature,” the legal problem or relationship had its
“seat.” Anglo-American law also sought the territorially
applicable law because, in the view of the American
legal scholar Joseph Beale (1861–1943), whose
thoughts shaped much of American conflict-of-laws
theory in the first half of the 20th century, that is
where the rights and obligations of the parties
“vested.” This vested-rights doctrine maintained that,
once a right was created in one locale, its existence
should be recognized everywhere. Classic theories of
conflicts law used a number of connecting factors to
determine the territorially applicable law. In matters
of family law, Anglo-American law used the
parties’ domicile (narrowly defined). In civil-law
countries, by contrast, a person’s nationality was until
recently the most important connecting factor.
Because of the influence of the Hague Conference on
Private International Law, however, the reference is
now more commonly to the law of a person’s “habitual
residence” (as it is in the law of jurisdiction).

For torts, American law traditionally looked to the law

of the place of injury, whereas European law referred
either to it or to the law of the place where the
wrongful conduct had occurred. Some European
systems referred to the law of either of these places;
this was, and continues to be, the plaintiff-favouring
choice-of-law rule in Germany. For contracts, most
legal systems looked to the place of performance
for breach but stipulated that the place of formation
was a more important connecting factor for questions
of validity. These examples illustrate that rather well-
defined connecting factors can identify the applicable
law in a predictable manner, subject to exceptions in
certain difficult cases.
Despite, or perhaps because of, their predictable results,
these rules at times failed to serve the interests of justice:
they were inflexible, and they did not prevent important
aspects of a particular case from being overlooked. Such
problems could have occurred in cases involving
the fortuitous commission abroad of a tort involving parties
with a common domicile in the forum or in another state
(where the long-term effects of the tort would be felt) or the
conclusion of a contract in an unrelated state (for example,
at a trade fair) between two or more parties, all of whom
conducted business in a common (but different) state. In
both examples, the common (“home”) law of the parties
might serve the parties’ interests—and those of society—
better than the mechanical application of traditional tort or
contract choice-of-law rules. Consequently, courts and
parties resorted to so-called “escape devices” that yielded
better, more appropriate results. Among these is the
recharacterization of a set of facts—e.g., the recasting of a
question of contract as a tort or a tort question as one of
family law. For example, what law governs the question of
whether spouses have the capacity to sue each other or
whether they have immunity? In a personal-injury case, is
this a question of tort law (i.e., the law of the place of
injury) or family law (law of the state of the marital
domicile)? If the two laws differ, the characterization of the
issue may produce different outcomes. The escape from
rigid rules by means of recharacterization resulted in a
period of considerable uncertainty, especially in the United
States.
Contemporary developments

New approaches to choice of law, starting with the

governmental-interest analysis developed by the American
legal scholar Brainerd Currie, began to emerge in the
1950s. Currie’s approach sought to determine whether a
“true” or “false” conflict exists between the law of the
forum state and that of the other involved state. A false
conflict exists if the laws of both states do not differ; if,
though ostensibly different, both laws are designed to
effectuate the same policy; or if one law is construed to be
inapplicable to cases such as the one before the court. If by
these guidelines the other state is determined not to have an
interest, a false conflict exists, thus making the local law of
the forum the applicable choice of law.
In cases of “true conflict”—i.e., in cases in which both the
forum’s law and another law claim applicability—Currie
called for the application of forum law. He rejected any
evaluation or weighing of the competing state interests,
considering this to be a legislative, not a judicial, function.
Contemporary applications of interest analysis do
undertake to weigh the relative interest; an example is
California’s “comparative impairment” approach. Overall,
governmental-interest analysis has had a significant
influence on modern American conflicts law.
Another approach, known as the better-law approach,
attempts to determine which of two potentially applicable
laws is better as a solution to the problem at hand. Not
surprisingly, both the governmental-interest and the better-
law approaches tend to apply the lex fori, either because the
other law is deemed to be inapplicable (i.e., the other state
is disinterested, or there is a so-called “false conflict”) in
view of the forum’s determination that it has the greater
interest in having its law applied or because forum law,
according to the better-law approach, is deemed to be
better. American case law employing these approaches has
tended to display a “homeward trend”—i.e., one that
favours the home forum.