Applicable law—common law (contract)
Applicable law—common law (contract)

The following Dispute Resolution practice note provides comprehensive and up to date legal information covering:

  • Applicable law—common law (contract)
  • Requirement for a proper law of a contract
  • What is the common law
  • When is the common law applied?
  • Common law rules—three stage enquiry
  • Express choice of law
  • Implied choice of law
  • System of law with the closest and most real connection
  • Chosen law must be the law of a country

Requirement for a proper law of a contract

The rationale for the need for there to be a proper law of a contract was explained in the dictum of Lord Diplock in when he said this:

‘My Lords, contracts are incapable of existing in a legal vacuum. They are mere pieces of paper devoid of all legal effect unless they were made by reference to some system of private law which defines the obligations assumed by the parties to the contract by their use of particular forms of words and prescribes the remedies enforceable in a court of justice for failure to perform any of those obligations …’

What is the common law

When is the common law applied?

When determining the applicable law for contract claims there are a number of different regimes in place and it is important to understand which one the English court will apply in determining the applicable law for the dispute. This will depend on the date of the contracts as well as other factors. The relevant regimes are:

  1. Rome I—this is applied by the courts of EU Member States when considering contracts concluded on or after 17 December 2009, see: Applicable law (EU regime)—overview

  2. Rome Convention—this is applied by the courts of the contracting states of the Convention for contracts entered into after 1 April 1991 where Rome I does not apply,

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