Hong Kong Conflict of Laws - Term Paper Example

This principle was also applied by Bingham J in the case of The Iran Vojdan, where a clause for dispute settlement provided for (a) Iranian law in Iran (b) German law in Hamburg and (c) English law in London. But applying the principle of the closest and most real connection, Lord Bingham held that the proper law to apply would be German law with the proper jurisdiction being the English Courts. Various factors are taken into consideration by the Courts in arriving at a determination of the proper law on the basis of the closest and most real connection, including the place of contracting, the place where the contractual obligations were performed and the principal places of business of the parties4.

The application of the closest and most real principle is found under Hong Kong’s choice of law rules with respect to contractual obligations and has also been recommended as a guiding principle when courts experience characterization problems. This principle has also been applied in non-contractual issues, for instance in matters involving capacity, matrimonial issues, including divorce and division of matrimonial assets, trusts and property cases5. One example, is the case of Hayim v Citibank6 which was an appeal from Hong Kong involving issues of trust with Plaintiff’s will having been made in Hong Kong.

But the matter was decided under English law, which was held to satisfy the closest and most real principle because no evidence was led as to Hong Kong or American law. There is provision for application of this principle in the law of mainland China as well, under Article 126 of contract law provisions, which states; “Where parties to the foreign related contract failed to select the applicable law, the contract shall be governed by the law of the country with the closest connection thereto”7. When no