Definition of lex loci solutionis
The lex loci solutionis is the Latin term for "law of the place where relevant performance occurs" in the conflict of laws. Conflict is the branch of public law regulating all lawsuits involving a "foreign" law element where a difference in result will occur depending on which laws are applied.
When a case comes before a court and all the main features of the case are local, the court will apply the lex fori, the prevailing municipal law, to decide the case. But if there are "foreign" elements to the case, the forum court may be obliged under the conflict of laws system to consider:
- whether the forum court has jurisdiction to hear the case;
- it must then characterise the issues, i.e. allocate the factual basis of the case to its relevant legal classes; and
- then apply the choice of law rules to decide which law is to be applied to each class.
The lex loci solutionis is one of the possible choice of law rules applied to cases testing the validity of a contract and in tort cases. For example, suppose that a person domiciled in Bolivia and a person habitually resident in Germany, make a contract by e-mail. They agree to meet in Arizona to research a book. The possibly relevant choice of law rules would be:
- the lex domicilii, lex patriae or the law of habitual residence to determine whether the parties had the capacity to enter into the contract;
- the lex loci contractus which could be difficult to establish since neither party left their own state (reliance on postal rules for offer and acceptance in the several putative lex causae might produce different results);
- the lex loci solutionis might be the most relevant since Arizona is the most closely connected to the substance of the obligations assumed;
- the proper law; and
- the lex fori which might have public policy issues if, say, one of the parties was an infant.
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