Bar Exam Conflict of Laws Review

Conflict of laws, also known as choice of law, is a pivotal subject on the Multistate Essay Examination (MEE) because it tests your ability to think like a lawyer in a national practice. You must navigate disputes that cross state lines, determining which court can hear the case, which state’s law applies, and whether a judgment from one state must be honored in another. Mastering this area requires a clear framework for analyzing jurisdiction selection, choice of law approaches, full faith and credit, and the Erie doctrine.

Jurisdiction and Forum Selection: The Gateway Questions

Before a court can decide which law applies, it must first determine if it has the power to hear the case. You must always start a conflict of laws analysis by addressing two distinct concepts: jurisdiction and forum.

Personal jurisdiction concerns a court’s power over the parties. For an out-of-state defendant, you apply the familiar minimum contacts analysis from International Shoe. A key MEE tactic is to spot and discuss specific jurisdiction (the claim arises from the defendant’s forum-state activities) versus general jurisdiction (the defendant is “at home” in the forum state).

Subject matter jurisdiction, often federal diversity jurisdiction under 28 U.S.C. § 1332, is a separate threshold. Once you establish a court has both personal and subject matter jurisdiction, you then analyze forum selection. This involves the doctrine of forum non conveniens, where a court with proper jurisdiction may dismiss a case because another forum (state or country) is vastly more convenient and appropriate. On the exam, argue both sides: the plaintiff’s choice of forum is given weight, but it can be overcome by strong private interest (e.g., witness location) and public interest (e.g., court congestion) factors.

Choosing the Governing Law: Three Competing Methodologies

When a case with connections to multiple states lands in a court, that court must decide which state’s substantive law governs the dispute. The MEE frequently tests your ability to distinguish between the three primary approaches.

The First Restatement (Vested Rights) Approach applies rigid, territorial rules. For torts, the law of the place of the wrong (lex loci delicti) governs. For contracts, the law of the place of contracting (lex loci contractus) applies. This approach is highly predictable but can lead to arbitrary results, especially when the “place of the wrong” is fortuitous. Some states still adhere to this method, so you must recognize it.

The Second Restatement (Most Significant Relationship) Approach is the most commonly tested and adopted method. It is a flexible, factor-based analysis. You examine § 6 principles, which include the needs of the interstate system, the relevant policies of interested states, and the protection of justified expectations. Then, you apply specific presumptive rules found in later sections. For torts, § 145 points to the law of the state with the most significant relationship to the occurrence and the parties. For contracts, § 188 does the same, but § 187 provides a critical exception: if the parties included a choice-of-law clause in their contract, that choice will be honored so long as the chosen state has a substantial relationship to the parties or transaction and its application is not contrary to a fundamental policy of a state with a materially greater interest.

Governmental Interest Analysis focuses on the policies behind the competing states’ laws. You first determine if there is a “true conflict” (both states have an interest in applying their law), a “false conflict” (only one state has an interest), or an “unprovided-for case” (neither state has an interest). In a true conflict, some courts apply forum law, while others may attempt a “comparative impairment” analysis to see which state’s interest would be more impaired if its law were not applied. This approach is highly policy-oriented and less predictable.

On an MEE question, your job is to spot the clues indicating which approach the forum court uses (often given in the fact pattern) and then walk through the appropriate analysis step-by-step, arguing how factors apply to the facts.

Full Faith and Credit: Respecting Sister-State Judgments

Article IV, § 1 of the U.S. Constitution requires each state to give full faith and credit to the public acts, records, and judicial proceedings of every other state. This doctrine has two critical applications for the bar exam.

First, and most powerfully, it applies to judgments. A final judgment from one state that is valid and on the merits must be recognized and enforced in another state. The enforcing state cannot re-examine the underlying merits of the case. There are very few exceptions, primarily lack of jurisdiction or fraud in procurement. This means a plaintiff with a money judgment from State A can domesticate it in State B to seize assets located there.

Second, full faith and credit applies to statutes or “public acts” in a much more limited way. The Constitution does not compel State B to apply State A’s statute in State B’s courts. Choice-of-law rules (discussed above) make that determination. However, the Supreme Court has held that a state must have a “significant contact or aggregation of contacts” to the parties and occurrence to apply its own law, preventing the application of law with no connection to the case.

The Erie Doctrine: Navigating State Law in Federal Court

When a case is in federal court under diversity jurisdiction, a unique conflict arises: should the court apply federal law or state law? The Erie doctrine, derived from Erie R.R. v. Tompkins, holds that a federal court sitting in diversity must apply state substantive law and federal procedural law. The goal is to discourage forum shopping and avoid the inequitable administration of the laws.

To apply Erie, use a three-step analysis:

1. Is there a directly controlling federal statute or Federal Rule? (The Hanna Analysis). If a Federal Rule of Civil Procedure, Evidence, or Appellate Procedure directly covers the issue, it applies if it is constitutional and within the Rules Enabling Act’s scope. This is often outcome-determinative in itself.
2. If not, use the “Outcome-Determinative” Test (The Byrd Balancing Test). Ask: would applying federal practice over state law substantially affect the outcome of the litigation? If yes, the state law likely governs. You must also balance the state’s interest in its rule against the federal court’s interest in procedural integrity.
3. Avoid the “Twin Aims” of Erie: Would applying federal practice encourage forum shopping or lead to inequitable administration of the laws between citizens and non-citizens? If yes, apply state law.

For example, a state’s statute of limitations is substantive under Erie, so a federal diversity court must apply it. However, the federal standard for summary judgment is procedural, so the Federal Rule controls even if state law is more stringent.

Common Pitfalls

Conflating Choice of Law with Jurisdiction. This is the most frequent analytical error. Remember: jurisdiction is about the court’s power; choice of law is about which rules to apply after power is established. Always address jurisdiction first.

Misapplying the Erie Doctrine to Pure State Law Claims in State Court. The Erie doctrine only applies in federal courts sitting in diversity. If a case is in state court, even if the parties are from different states, Erie is irrelevant. The state court uses its own conflict of laws rules.

Treating All Choice-of-Law Approaches as the Same. An essay that generically discusses “the most significant relationship” without first identifying which Restatement or approach the forum state uses will lose points. Explicitly state the controlling methodology (e.g., “Under the Second Restatement approach adopted by this state…”).

Forgetting the Hierarchy of Contractual Choice-of-Law Clauses. Under the Second Restatement (§ 187), a contractual choice-of-law clause is given deference, subject to the fundamental policy exception. Always check for a contract clause before launching into the general § 188 analysis for contracts; the clause may resolve the issue.

Summary

• Start with the court: Always analyze personal and subject matter jurisdiction before tackling which law applies.
• Identify the choice-of-law methodology: Determine whether the forum state follows the First Restatement (territorial rules), Second Restatement (most significant relationship), or a governmental interest analysis, and apply that framework meticulously.
• Honor judgments across state lines: Under Full Faith and Credit, a valid, final judgment from one state must be recognized and enforced in another, with very narrow exceptions.
• Apply Erie in federal diversity cases: Federal courts apply state substantive law and federal procedural law. Use the Hanna test for direct conflicts with Federal Rules, and the outcome-determinative test for judge-made procedural rules.
• Distinguish the issues sharply: Jurisdiction, choice of law, judgment enforcement, and the Erie doctrine are related but distinct legal concepts. A clear, stepwise analysis for each is the hallmark of a high-scoring MEE answer.