The Temporal Aspects of Choice-of-Law Clauses

Abstract

When a choice-of-law clause selects the “laws” of a particular jurisdiction, it is not always clear whether it operates to select those laws (1) as they existed at the time the contract was signed, or (2) as they exist at the time of the litigation. When the choice-of-law clause is silent on this issue—as it almost always is—the court must craft an interpretive default rule that reflects majoritarian preferences relating to choice of law and time.

This Essay argues that courts should interpret the word “laws” to select the laws of the chosen jurisdiction at the time of litigation. It proceeds in four parts. Part I surveys general principles that should inform the project of interpreting choice-of-law clauses. Part II makes the affirmative case for applying the chosen laws at the time of litigation. Part III explains why applying the chosen laws at the time of signing is probably not what most parties intend. Part IV lists some limitations as to when this interpretative approach should be utilized.