In, out, shake it all about - where are we on choice of law in Rome 1?

13.01.09 Share

 
  • Don't forget to include a choice of law clause in your agreement. It may sound simple but people do! A choice of law clause will assist in preventing the choice of law from being taken out of the hands of the parties and given to the courts – the last thing any contracting party wants. An express choice of law is the easiest way of providing certainty in a contractual relationship. A contract without such a clause can create a lack of uncertainty about interpretation, performance and enforcement of the contract. In the event of a dispute, it can add to expense, delay and frustration.
  • Carefully consider the law you want applied before agreeing the choice of law clause. This should be done before beginning to draft an agreement since, if it is not to be English law, a lawyer qualified in the relevant jurisdiction will need to advise upon or draft the agreement.
  • Consider whether there are any mandatory rules of another country that might apply to the dispute and if so, whether these will impact on your choice of law.
  • Any choice of law clause should be considered in conjunction with the choice of jurisdiction selected. It is possible for the courts of England & Wales to have jurisdiction to hear a dispute but apply the laws of France if that is the law selected by the parties. Such instances are likely to add both to the costs of any legal proceedings as well as uncertainty as to the eventual outcome. Aligning the choice of law and jurisdiction clause is usually preferable.

Key Contact

Tom Price, director, +44 (0)121 685 3888, tom_price@wragge.com

This action may contain information of general interest about current legal issues, but does not give legal advice.