False Conflicts and Faulty Analyses: Judicial Misuse of Governmental Interests in the Second Restatement of Conflict of Laws

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I. INTRODUCTION

The Second Restatement of Conflict of Laws2 has the irony of dominating the field while bewildering its users.3 The result is a set of choice-of-law decisions so lacking in uniformity that the Second Restatement's balancing test has become chimeric, taking on vastly different forms in different courts.4 Erratic applications may be partly due to its code-like function, which can require the application of two or more black letter sections, each with multiple analytical steps.5 Critics also point to the political and academic compromises that pervaded the American Law Institute's drafting process for this project, leading to ambiguity in some sections.6 But a far larger problem in state and federal courts throughout the United States is significant deviation from the Second Restatement's multifactored test to single-factor tests, directly caused by the persistence of two radically different methodologies-the First Restatement's territorially fixed lex locus test and Brainerd Currie's governmental-interest analysis. Scholars surveying this phenomenon have reported, on the one hand, cases limited to contact counting that mimic the First Restatement, and, on the other, cases relying too heavily or even entirely on perceived governmental interests.7 But no long-term study has yet measured this error in the controlled setting of a single state.

Second Restatement adoptions necessarily assume different forms in different states, even without aberrational applications. To avoid inappropriate comparisons, a study is best focused on a single state large enough to produce a sample. This Article quantifies the deviations by examining Texas practice in the twenty-four years from Texas's 1979 adoption of the Second Restatement's most-significant-relationship test for tort cases. As the most populous state using the Second Restatement for both tort and contract cases, Texas may be the ideal laboratory.8 Because the contact-counting deviation is simply detected and clearly inappropriate under the Second Restatement, those cases in which contact counting is employed are merely listed.9 The study accordingly focuses on the more complicated task of isolating the Currie-inspired misapplications.

In spite of drafting compromises and some aberrational applications, the Second Restatement's balancing approach works when properly applied, as the majority of Texas courts have done.10 This study of misapplications is meant to improve choice-of-law analyses, and, in the longer term, underscore the need for fine tuning the choice-of-law test in the courts, the legislature, or the American Law Institute.

II. THE TEXAS STUDY

Texas state and federal courts apply the wrong choice-of-law test one out of five times. This is not to say that they apply the test wrong-they sometimes do-but that they apply the wrong test. In 21.01% of the civil cases invoking the most-significant-relationship test, Texas courts are applying the Currie governmental-interest analysis or some aspect of it. Some may perceive these tests as eclectic and believe that mixing them to fit the occasion is appropriate. But in chemistry, cooking, and conflicts law, some formulas do not mix.11 Although the Second Restatement is itself eclectic, it is incompatible with the governmental-interest analysis developed by Brainerd Currie and others. The biggest difference is that in Currie's approach, speculative governmental interests drive the analysis, while under the Second Restatement, governmental interests are merely a factor-albeit an important one-to be balanced against several others. In its pure form, Currie's obtuse method is used in only three states, and there only for tort issues.12

The best example of their incompatible differences is the false conflict. Under Currie's approach, a false conflict occurs when the court determines that only one state has a true interest in the dispute.13 That determination ends the analysis; and the interested state's law is applied. …