Governmental Interest Analysis Choice of Law In California
What is the "Governmental Interest Analysis" Test ?
In California, general choice of law questions are determined under the "governmental interest analysis," which provides the court "'must search to find the proper law to apply based upon the interests of the litigants and the involved states.'" (Offshore Rental Co. v. Continental Oil Co. (1978) 22 Cal.3d 157, 161.)
First, we determine whether the applicable rules of law are materially different. If the rules differ materially, we examine the interests of each state in having its law applied.
"If each jurisdiction has an interest in applying its own law to the issue, there is a 'true conflict' and the court must proceed to the third step.
In the third step, known as the comparative impairment analysis, the court determines which jurisdiction has a greater interest in the application of its own law to the issue or, conversely, which jurisdiction's interest would be more significantly impaired if its law were not applied.
The court must apply the law of the jurisdiction whose interest would be more significantly impaired if its law were not applied." (Frontier Oil Corp. v. RLI Ins. Co. (2007) 153 Cal.App.4th 1436, 1454-1455 citing Kearney v. Salomon Smith Barney, Inc. (2006) 39 Cal.4th 95, 107-108.)