"Arbitrary and Fortuitous"? The Revival of Territorialism in American Choice of Law

When the conflict of laws revolution swept away the First Restatement in the mid-twentieth century, it took with it many of the ideas associated with traditional choice of law theory. Territorialism was one such collateral casualty. The close association between territorialism and the disgraced First Restatement methodology made it an obvious target. However, the real problem was not territorialism but rather the First Restatement’s system of “vested rights,” its endorsement of a “general common law,” and its system of inflexible rules. A more successful challenge to territorialism was the claim that territorialism produces “arbitrary and fortuitous” results. This assertion has been repeated so often that we rarely stop to think about its meaning. This Essay takes a critical look at the argument that territorialism is “arbitrary and fortuitous” and finds it baseless This Article then considers how territorial thinking interacts with the prevailing modern theories. The current policy approaches have placed particular focus on domiciliary connecting factors, and sidelined territorialism in the process. However, a closer look reveals that—even where policy analysis advocates a rejection of territorialism—modern theories still allow territorialism in through the back door. Despite the claims of the conflicts revolution, territorial thinking continues to underpin modern choice of law in ways that policy theorists have failed to recognize. This is not to minimize the profound differences between policy analysis and territorialism. This Essay identifies three fundamental differences that speak to their core disagreements. By elaborating on these differences, this Essay shows that a strict policy approach to choice of law is not tenable: only by moderating its core commitment to substantive norms can policy analysis begin to adequately incorporate territorialism’s key insights.