Journal article
The Use and Abuse of Governing-Law Clauses in Trusts: What Should the New Restatement Say?
Iowa law review, Vol.103(4), pp.1711-1727
05/01/2018
Abstract
This Essay offers a novel solution to a thorny problem at the intersection of trust law and the conflict of laws: When should the settlor be able to choose a governing law other than the law of the jurisdiction with the most significant relationship to the trust? The law of the conflict of laws gives effect to a governing-law clause in a trust instrument except when contrary to the "strong public policy" of the jurisdiction with the most significant relationship to the matter at issue. But what is "strong public policy"? The answer should not depend on the size of the Chancellor's foot. This Essay proposes, instead, that the answer should incorporate the well-established distinction between the default rules of trust law, which aim to effectuate the intention of the typical settlor but yield to a particular settlor's contrary intention, and the mandatory rules of trust law, which apply without regard to intention for reasons of overriding public policy. This Essay proposes that a governing-law clause in a trust instrument should be effective unless contrary to the mandatory law of the jurisdiction with the most significant relationship to the matter at issue. The Essay urges the adoption of this approach by the Restatement (Third) of the Conflict of Laws, which is currently in the process of being drafted.
Details
- Title: Subtitle
- The Use and Abuse of Governing-Law Clauses in Trusts: What Should the New Restatement Say?
- Creators
- Thomas P. Gallanis - University of Iowa
- Resource Type
- Journal article
- Publication Details
- Iowa law review, Vol.103(4), pp.1711-1727
- Publisher
- Univ Iowa, Coll Law
- ISSN
- 0021-0552
- Number of pages
- 17
- Grant note
- Singapore Academy of Law Singapore Management University University of York
- Language
- English
- Date published
- 05/01/2018
- Academic Unit
- Law Faculty
- Record Identifier
- 9984418971002771
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