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What should the governing law be?

Governing law is a contractual provision (also known as a choice of law provision) that determines which law shall apply in the event of a dispute. Such a clause is generally honored by the courts which do not interfere with the agreement of the parties regarding the applicable law.

How do you select the governing law of an agreement?

Parties to a contract are free to choose their governing law: it need not have any connection with the location of the contracting parties or the subject matter of the contract. In practice the parties choice of law may often be straightforward, based on market practice or the law that they are familiar with.

Can governing law and venue be different?

First, it is important to note that the governing law and venue are distinct. The courts of one jurisdiction can and regularly do apply the law of another jurisdiction. State courts can apply federal law or the law of any other state, and federal courts can apply the law of any state in addition to federal law.

Can a contract have 2 governing laws?

A contract could be governed by two different types of state law, depending on the subject of the contract: Common Law: The bulk of most contracts are controlled by common law in most states. This is a traditional set of laws that are that are made by judges based on different court decisions throughout history.

How is governing law determined?

Governing Law is determined by jurisdiction, which is any larger area that has its own specific local law set. For clarification, there are 51 jurisdictions within the United States. This is different from a sovereign state, which is generally what we would think of as a country.

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