What Is the Restatement Second of Conflict of Laws?

The Restatement Second of Conflict of Laws is the American Law Institute’s 1971 framework for deciding which state’s law applies when a legal dispute touches more than one state.¹ Instead of a rigid rule tied to one geographic event, it tells courts to identify the state with the “most significant relationship” to the dispute and apply that state’s law, judged against seven policy factors in Section 6. It covers torts, contracts, property, family law, and procedural questions, and a clear majority of U.S. states use it in at least some areas.

What It Replaced

The original Restatement of Conflict of Laws, published in 1934, used a “vested rights” approach: whichever state hosted the last event necessary to create the legal right controlled the outcome.¹ For torts, that was the place of injury. For contracts, the place where the contract was made. The appeal was predictability; the problem was arbitrariness, since the controlling state often had no real connection to the parties or their relationship.

By mid-century, courts and scholars had developed alternatives, and the Restatement Second — a seventeen-year drafting project completed in 1971 — pulled the best of those ideas into one framework. It gives judges discretion to look past the single-event rule and weigh where the parties actually live, where their relationship is centered, and which state’s policies are most at stake on the specific issue in front of them.

The Section 6 Factors

Section 6 is the engine of the entire framework. Every choice-of-law question under the Restatement Second runs through these considerations, whether the dispute is about a car crash, a broken contract, or a disputed inheritance. When no statute dictates the answer, Section 6(2) lists seven factors a court weighs:²

The needs of the interstate and international systems.
The relevant policies of the forum state (where the suit was filed).
The relevant policies of other interested states, and their interest in having their law applied to this issue.
The protection of justified expectations — important when parties planned around a particular state’s law.
The basic policies underlying the field of law (compensation in tort, freedom of contract in commercial law, and so on).
Certainty, predictability, and uniformity of result, which discourage forum shopping.²
Ease in determining and applying the law a court chooses.

No single factor controls. Their relative weight shifts with the type of case. Justified expectations matter most in contract disputes, where parties planned around legal rules. The interests of the competing states tend to dominate in tort disputes, where no one planned to get hurt in the first place.

How It Works in Tort Cases

Section 145 governs tort disputes — personal injury, property damage, fraud, defamation, and similar claims. The court applies the law of the state with the most significant relationship to the occurrence and the parties, judged under the Section 6 factors. Section 145(2) gives the court four concrete contacts to evaluate:³

The place where the injury occurred.
The place where the conduct causing the injury occurred.
The domicile, residence, nationality, place of incorporation, and place of business of the parties.
The place where the relationship between the parties, if any, is centered.

These contacts are weighed, not counted. If both parties live in the same state, that state almost always has the dominant interest in how losses between them are allocated, even if the injury happened somewhere else. If an employer and employee are both based in State A but the injury happens on a business trip in State B, State A remains the center of the relationship.

The weight of each contact also shifts with the specific legal issue. A question about whether to impose strict liability may point to the state where the dangerous activity took place. A question about a damages cap may point instead to the victim’s home state, because the cap exists to regulate how much compensation flows to residents. This issue-specific flexibility is one of the Restatement Second’s most distinctive features, and it opens the door to what lawyers call dépeçage: applying different states’ laws to different issues within the same case.⁴ A product liability court might apply the manufacturing state’s law on negligence but the victim’s home state’s law on damages. The tradeoff is complexity: each genuinely disputed issue needs its own choice-of-law analysis.

How It Works in Contract Cases

Contract disputes follow a parallel structure, with one important difference. Parties can often choose the governing law themselves before any dispute arises. The analysis splits based on whether the contract contains a choice-of-law clause.

When There Is a Choice-of-Law Clause

Section 187 gives strong effect to the parties’ choice. If the issue is one the parties could have resolved by writing a specific term into the contract — a deadline, a liability cap, an allocation of risk — their chosen state’s law applies with almost no scrutiny.⁵

If the issue is one the parties could not have resolved by agreement — for example, whether a non-compete clause is enforceable at all — the chosen law still governs unless one of two exceptions applies. Either the chosen state has no substantial relationship to the parties or the transaction and no other reasonable basis supports the choice, or applying the chosen law would violate a fundamental policy of a state with a materially greater interest that would otherwise govern.⁵ A mere difference between the two states’ laws will not trigger the exception; the policy at stake has to be fundamental.

When There Is No Choice-of-Law Clause

If the parties never selected a governing law, Section 188 directs the court to a contacts analysis. The relevant contacts are:⁴

The place of contracting (where the final act making the agreement binding occurred).
The place of negotiation.
The place of performance, which often carries the most weight in service contracts.
The location of the subject matter, especially where the contract involves specific property.
The domicile, residence, place of incorporation, and place of business of the parties.

Again, these are weighed under the Section 6 factors rather than tallied. A contract negotiated and performed entirely in one state will almost always be governed by that state’s law, even if one party is incorporated elsewhere. Specialized rules on capacity (Section 198) and usury (Section 203) tilt toward sustaining the contract where possible, consistent with the framework’s general policy of protecting justified expectations in commercial dealings.⁴

How It Works in Property Cases

Property disputes split into two tracks. Real property follows one of the few bright-line rules the Restatement Second preserved: the law of the situs, meaning the state where the land sits, governs nearly all questions. Under Section 223, whether a deed transfers an interest in land, and what kind of interest it transfers, is decided by the law of the state where the land is located.⁴ The same holds for transfers by operation of law under Section 226. Land cannot move, and the state where it sits has the strongest interest in controlling who owns it.

Personal property is handled more flexibly. Under Section 244, the validity and effect of a transfer of movables is governed by the law of the state with the most significant relationship under Section 6, with greater weight usually given to where the property was located at the time of the transaction. For inheritance of personal property, the rules shift toward domicile: Section 260 looks to the law of the state where the deceased person was domiciled at death to determine who inherits when there is no will, and Section 263 applies the same rule to the validity of a will disposing of personal property.⁴

Procedure vs. Substance

A court always applies its own procedural rules, no matter which state’s substantive law governs the merits. If you file in State A under State B’s tort law, State A’s rules on evidence, discovery, and pleadings still control how the case is tried. The Restatement Second only selects the substantive rules — the ones that define rights, duties, and liability.

The hard part is classifying issues that sit on the border. Statutes of limitations are the classic example. Historically, most courts treated them as procedural, so the forum’s deadline always controlled. Under Section 142, the analysis is more nuanced. If the forum state’s statute of limitations would bar the claim, the forum applies its own deadline. If the forum’s deadline would let the claim through, a court can still bar it when maintaining the suit serves no substantial interest of the forum and the claim would be time-barred in the state with a more significant relationship.⁴ This closes off a common forum-shopping move: filing in a distant state solely to escape a limitations bar in the state that actually cares about the dispute.

The Public Policy Escape Valve

Even after a full Section 6 analysis points to another state’s law, Section 90 lets a court refuse to apply that law if doing so would offend a strong public policy of the forum. The threshold is deliberately high. A mere difference between the two states’ laws is not enough; courts have described the standard as requiring the foreign law to shock the conscience or violate some fundamental principle of justice.

Section 90 is all-or-nothing. If invoked, the court dismisses the claim rather than substituting its own law for the parts it dislikes. It works only as a shield for the forum’s own policy and cannot be used to strike down a defense that would be valid under the otherwise applicable foreign law. Successful invocations are rare precisely because the bar is high, but the exception sits in the framework as a structural limit on how far deference to foreign law can be pushed.

Renvoi Is Rejected

When the Restatement Second tells a court to apply the “law” of another state, it means that state’s internal substantive rules. It does not mean the other state’s choice-of-law rules. This rejection of renvoi prevents an endless cross-reference loop, in which one state’s conflicts framework points to another state, whose conflicts framework points back or elsewhere. Once a court identifies the state with the most significant relationship, it applies that state’s internal law directly.

Whether a Given State Actually Uses It

Adoption is not universal. A clear majority of states follow the Restatement Second for tort cases, contract cases, or both, but the exact count depends on how you classify states that blend it with other approaches. Some states instead use “governmental interest analysis,” which focuses more directly on which state’s policy would be advanced or frustrated by applying its law. A handful still apply the old territorial rules from the First Restatement in certain areas, especially tort. Others follow hybrid approaches that borrow Restatement Second contacts but layer on their own tests.

A state might also use the Restatement Second for one type of claim and a different framework for another. Before running a Section 145 or Section 188 analysis, check which methodology the forum state actually follows for the type of claim at issue. Corporate governance disputes are a separate pocket entirely: under the internal affairs doctrine, the relationship between a corporation and its officers, directors, and shareholders is governed by the law of the state of incorporation, which is a large part of why so many companies incorporate in Delaware.⁶ Applying the wrong framework to the right facts still produces the wrong answer, so the methodology question comes first.

1
The American Law Institute. Restatement of the Law Second, Conflict of Laws
2
Columbia University. Restatement (Second) of Conflict of Laws – Section 6 Choice-Of-Law Principles
3
H2O. Excerpts from Restatement (First) and (Second) of Conflict of Laws
4
William & Mary Law School. Selections from the Second Restatement
5
Columbia University. Restatement Second of Conflict of Laws – Section 187
6
OpenCasebook. Corporations – Choice of Law: The Internal Affairs Doctrine