Erie v Dombroski: Choice of Law Standards Discussed

Judge Opel in a recent opinion discusses choice of law issues for bankruptcy cases involving an issue where there is a conflict between state laws.

The Court must undertake a choice-of-law analysis to decide which law will determine whether the alleged choice-of-law provision is enforceable.  To answer a choice-of-law issue, federal courts are required to apply the choice-of-law rules of the “state in which it sits. Pennsylvania’s standard for choice-of-law questions is a hybrid of two tests: the “most significant relationship” approach of the Restatement (Second) of Conflicts of Law and the governmental interest approach.  The Pennsylvania approach is a two-step analysis. First, the court must determine whether there is a true conflict of laws or merely the existence of a “false conflict.”  If a true conflict exists, the reviewing court then determines which state has the greatest interest in the application of its law through use of then “most significant relationship” test of the Restatement (Second) of Conflict of Law.  To resolve whether a true conflict exists, courts compare the competing state laws and the governmental interests they represent.

 

12-AP-156 Erie v Dombroski Summary Judgment Opinion