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The Public Policy Doctrine in Choice of Law: a Reconsideration of Older Themes

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The Public Policy Doctrine in Choice of Law: a Reconsideration of Older Themes Washington University Law Review Volume 1974 Issue 3 January 1974 The Public Policy Doctrine in Choice of Law: A Reconsideration of Older Themes Gary J. Simson Connecticut Bar Association Follow this and additional works at: https://openscholarship.wustl.edu/law_lawreview Part of the Conflict of Laws Commons, and the Jurisdiction Commons Recommended Citation Gary J. Simson, The Public Policy Doctrine in Choice of Law: A Reconsideration of Older Themes, 1974 WASH. U. L. Q. 391 (1974). Available at: https://openscholarship.wustl.edu/law_lawreview/vol1974/iss3/1 This Article is brought to you for free and open access by the Law School at Washington University Open Scholarship. It has been accepted for inclusion in Washington University Law Review by an authorized administrator of Washington University Open Scholarship. For more information, please contact [email protected]. WASHINGTON UNIVERSITY LAW QUARTERLY VOLUME 1974 NUMBER 3 THE PUBLIC POLICY DOCTRINE IN CHOICE OF LAW: A RECONSIDERATION OF OLDER THEMES GARY J.SIMSON* When presented with a cause of action not confined in its elements to the forum state, courts have on occasion announced that although the application of another jurisdiction's law is indicated in the instant case, they must decline to apply it because the law violates local public policy. In a classic formulation of the public policy doctrine, then- Judge Cardozo stated the test to be whether the foreign law can be said to "violate some fundamental principle of justice, some prevalent conception of good morals, some deep-rooted tradition of the common weal."1 The impact on the party against whom this doctrine is invoked may vary. A plaintiff whose complaint is dismissed on public policy grounds' will find no hospitable court for his action in the forum state. * Member of the Connecticut Bar. B.A., 1971, J.D., 1974, Yale University. 1. Loucks v. Standard Oil Co., 224 N.Y. 99, 111, 120 N.E. 198, 202 (1918). 2. Cases involving a dismissal on grounds of local policy regarding the allocation of judicial resources are not within the scope of this Article. See generally Hughes v. Fetter, 341 U.S. 609 (1951); Comment, Full Faith and Credit to Statutes of Sister States, 37 CORNELL L.Q. 441 (1952). Rather, the focus of this Article is the rejection of the application of foreign law on substantive grounds-i.e. because of the content of the specific law. Also distinguishable from the public policy doctrine is rejection of a cause of action because it calls for enforcement of foreign penal laws. For the special considerations raised by the penal doctrine, see Leflar, Extrastate Enforcement of Penal and Governmental Claims, 46 H~Av. L. Rav. 193 (1932). Washington University Open Scholarship 392 WASHINGTON UNIVERSITY LAW QUARTERLY [Vol. 1974:391 If the dismissal is made without prejudice, he may seek enforcement of his claim in another state. The latter possibility, however, may often prove illusory because of difficulties in obtaining personal jurisdiction over the defendant outside the state of the initial action.3 The fate of a defendant denied the opportunity to raise a defense for public policy reasons lacks any such ambiguities. Assuming no other ade- quate defense, he has lost on the merits, and a sister state is obliged under the full faith and credit clause to enforce the judgment against him. 4 The dissent to this doctrine long took the form of moral indignation. For one state to declare another's laws too abhorrent to enforce was for Beach "an intolerable affectation of superior virtue."5 Goodrich, in a similar vein, counseled "mutual tolerance for each other's little idiosyncracies"' and sought to persuade the doctrine's defenders that by applying foreign law in accordance with the mandate of basic choice of law rules, it [a state] does not, by such reference, flaunt its local policy with an implied recognition of the other state's as better; it does not make an appraisal one way or the other, but simply applies the foreign 7 rule as the appropriate one to determine this transaction. Nussbaum vehemently led the counterattack. He urged that "practic- ing liberalism becomes preposterous where it is exercised towards a foreign law which is plainly directed against the interests of the forum," and argued the consistency of the public policy doctrine with an inform- ing principle of American federalism-namely, "territorially limited experimentation."" Goodrich and others' seemed to get the better of the argument, at 3. See B. CURRIE, SELECTED ESSAYS ON THE CONFLICT OF LAws 212 n.88 (1963) (and sources cited) [hereinafter cited as CuamE]; cf. Pearson v. Northeast Airlines, Inc., 309 F.2d 553, 562 & n.17 (2d Cir. 1962). 4. See Fauntleroy v. Lum, 210 U.S. 230 (1908); Christmas v. Russell, 72 U.S. (5 Wall.) 290 (1866); Hampton v. M'Connel, 16 U.S. (3 Wheat.) 234 (1818); R. WEINTRAUB, COMMENTARY ON THE CONFLICT OF LAws 410-11 (1971). 5. Beach, Uniform Interstate Enforcement of Vested Rights, 27 YALE L.J. 656, 662 (1918). 6. Goodrich, Foreign Facts and Local Fancies,25 VA. L. REv.26, 35 (1938). 7. Id. at 33. But cf. CURIE 182. 8. Nussbaum, Public Policy and the Political Crisis in the Conflict of Laws, 49 YALE L.J. 1027, 1048-49, 1054 (1940). The impact on Nussbaum's position of the then-existing Fascist threat, it may be noted, is unmistakable. See also Kronstein, Crisis of "Conflict of Laws," 37 GEo. LI. 483 (1949). 9. See, e.g., Nutting, Suggested Limitations of the Public Policy Doctrine, 19 MINN. L. REv. 196 (1935). https://openscholarship.wustl.edu/law_lawreview/vol1974/iss3/1 Vol. 1974:391] PUBLIC POLICY DOCTRINE least in volume, with their indignant protests against parochialism. Some commentators, however, intimated that this umbrage might be fundamentally misguided. Courts invoke local public policy in choice of law, they argued, not so much out of dislike for the applicable foreign law but rather, in Cavers' terms, as a device to escape from the injustice or incongruity of applying the foreign law in a particular case.1" Because it provides an easy out from the result indicated by application of traditional rules, the public policy doctrine is objectionable as an escape from thoughtful articulation of better, more relevant conflict- of-law rules. With the development of Cavers' view in greater so- phistication and detail by Paulsen and Sovern," this conception of the doctrine appears to have relegated the more traditional criticisms of the public policy doctrine to the periphery, if not to total obscurity.12 Indeed, if the doctrine is only a guise-its invocation not really a state- ment on the content of the other jurisdiction's law at all-and its vice an invitation to unrigorous analysis, one would seem well advised to direct one's anger about parochialism elsewhere. The preemptive claim of the Paulsen-Sovem thesis, however, may not be as sound as is generally conceded. In this Article, I begin with the proposition that Professors Paulsen and Sovern have not wrested the field from the traditional critics. The parochialism argument against the public policy doctrine is one which can and should be made. It needs to be formulated, though, not in the metaphysical "right"- "wrong" terms in which Beach and his ideological brethren cast it, but instead contextually, in terms of the aggregate social consequences of the doctrine's employment. This Article attempts both to supplement and partly to supplant the Paulsen-Sovern contentions against the doc- trine by reinvigorating-or, perhaps more precisely, bringing to matur- ation-arguments directed at the doctrine's parochial tenor. I. THE LIMITATIONS OF THE PAULSEN-SOVERN PERSPECTIVE The contribution of the Paulsen-Sovern study to an understanding of 10. Cavers, A Critique of the Choice-of-Law Problem, 47 HARv. L. REv. 173, 180- 84 (1933). See also Note, The Public Policy Concept in the Conflict of Laws, 33 COLUM. L. REv. 508, 513 (1933). 11. Paulsen & Sovern, "Public Policy" in the Conflict of Laws, 56 CoLum. L. REv. 969 (1956) [hereinafter cited as Paulsen & Sovern]. 12. See E. CHnIAAM, E. GRiSWOLD, W. REESE & M. ROSENBERG, CONFLICT OF LAWS 403 (5th ed. 1964); R. CRAMToN & D. CURRIE, CONFLICT OF LAWS 146-47 (1968); CuiuuE 133 n.27, 181; Note, Illegality and Public Policy in the Conflict of Laws, 12 How. L.J. 331 (1966). Washington University Open Scholarship 394 WASMNGTON UNIVERSITY LAW QUARTERLY [Vol. 1974:391 the application of the public policy doctrine is of unquestionable sig- nificance. Writing in the best legal realist tradition,' 8 the authors pene- trated the courts' public explanations of their decision-making processes and set forth a view of the public policy doctrine attuned not to what courts say they are doing, but rather to what they are really doing: In short, "public policy" is one way to avoid the application of a choice of law rule which the forum wishes to avoid. The objection of the forum, thus, is not -to-the content of the law but to its own choice of law rule .... The overwhelming number of cases which have rejected foreign law on public policy grounds are cases with which the forum had some im- portant connection. It is apparent, then, that in most cases the choice of local rather than foreign law cannot be regarded simply as a matter of parochialism. 14 The attractiveness and basic plausibility of this thesis should not be allowed to obscure its limitations. For in two fundamental respects, one rooted in basic psychology and the other in the scope of the authors' focus on the social process, the, Paulsen-Sovern view fails to displace the "classical concept' 5 (as they disparagingly call it) of the public policy doctrine or to obviate the necessity for further development of the traditional criticisms.
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