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hey everybody what the heck time is it its time for another edition of what the heck does that contract clause mean so today were going to talk about the governing law clause this is the clause thats in the miscellaneous or general clauses at the end of almost every type of contract and if it isnt in there it really should be because what this clause does is it sets up the rules that will apply in case theres ever a dispute about the contract lets say you have one party whos entered the contract who lives in the state of california the other party lives in england because you can have international contracts what law applies is it united states law is it england law is it california law is it some other law by having a governing law clause what it does is it sets in writing what law is actually going to apply and it will override whatever might happen based on where somebody lives so this way the two parties can decide what law they want to apply to the contract they write it i