Points for assignment:

1. the proper law of a contract is the system of law by which the parties intended the
contract to be governed (societe generale de compensation v. moshie ackerman [1972]1
glr 413)
2. Per Anin J.S.C. “…the important doctrine of the proper law of a contract in the field of
conflict of laws or private international law. The basic facts for the ascertainment of the
proper law were on the whole not in issue in this case. The real bone of controversy
between the parties to this appeal was the application of the principles and rules of law
to the facts of the case.”
3. What, then, is the proper law of a contract and how is it judicially determined? Simply
defined, the proper law of a contract means the system of law which the contracting
parties either expressly intended or must be presumed to have intended to govern their
contractual obligations wherever performed. Three board propositions may here be
formulated on the concept of the proper law of a contract:
4. (1) The modern judicial test for determining the proper law is that propounded by Lord
Simonds when delivering the opinion of the Judicial Committee of the Privy Council in
Bonython v. Commonwealth of Australia [1951] A.C. 201 at pp. 219-221, P.C. where he
observed that:
"The proper law of the contract [is] the system of law by reference to which the contract
was made or that with which the transaction has its closest and most real connexion...
On the assumption that express reference is made to none, the question becomes a
matter of implication to be derived from all the circumstances."

The Simonds' test has been adopted in Volume 1 of the 1971 supplement to Halsbury's Law's of
England, at para. 137 of the supplement to Volume 7, and also in Dicey and Morris' Conflict of
Laws (8th ed.) where rule 127 states that:

"The system of law by which the parties intended the contract to be governed, or where their
intention is neither expressed nor to be inferred from the circumstances, the system of law with
which the transaction has its closest and most real connection."

5.