VRP Law Group, P.C.

A Boutique Business, Employment and Intellectual Property Law Firm

Use of Template Forms in Domestic and International Transactions-What about choice of law and jurisdiction?

We have all been involved in having to represent a client that has come to us after downloading a form or using a template provided by the other party, from searching the web or some friend, and found him, her or itself in a dispute with the other party. Now, in the increasingly global market it is even more problematic for individuals to deal with each other in a pragmatic manner without using good choice of law and jurisdictional provisions. It is very hard for individuals that use competing forms, poorly drafted forms and templates, or a Hodge podge of clauses or provision thrown together without any understanding of the business, litigation and transactional risks involved.

Unfortunately, this arises from a situation where individuals are in a rush to close the deal, but fail to grasp that there may be more loss from closing the deal than delaying or negotiating the deal further. In order to ensure that the parties have a clear grasp of their rights and their obligations it is crucial to ensure that you know which law will govern over the parties transaction and any dispute arising from it. It is common place for most states long arm statutes to provide for personal jurisdiction over any transaction that arose out of a contract or the performance of a contract within that state or from a personal injury arising from a product or service offered within that state.

However, it is much more difficult to sue a person in a state where the dispute arises from a contract that was not performed in the state, made in the same state, or services rendered were unrelated to the contract when the party is an international company. This makes it harder to pursue claims against an international party that may have operations in the United States, but not any shareholders or members that are citizens of the United States. Thus, often times, a business deal may be negotiated without a full grasp of the implications for purposes of enforcing the Agreement that is negotiated.

Many times, the company may not be a citizen of the state or the United States. Thus, it requires domestic clients to be cognizant of the need to acquire consent to jurisdiction in hers, his or its local state of operations, a convenient venue within the United States, or a domestic or international arbitration panel. Moreover, it is equally as crucial to be able to include a choice of law provision or incorporate by reference a treaty that the international party or the foreign country is a signatory and has executed.

Moreover, incorporating the Hague Convention on the Taking of Evidence into your Agreements and Choice of Law provisions is a very simple way to ensure that you are able to establish the consent required for exercising personal, subject matter jurisdiction and decide the substantive law that will be used to resolve any disputes to these transactions involving international parties. For more see the following: Battle of Forms and Choice of Law Analysis

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