VILLARUZ, SHIELA MAE G.

CONFLICT OF LAWS
JD 3-3

1. EXPLAIN PRIMARY OF CONTRACTUAL RELATIONS. WHAT IS THE LEGAL BASIS

FOR THIS?
Article 1306 of the Civil Code allows the parties to a contract to establish such
stipulations, terms and condition as the deemed convenient provided that they are not contrary
to law, morals, good customs, public order and public policy. The parties are free to stipulate
the terms and conditions that will govern their contractual relationship. And in case of dispute,
these stipulations shall be applied since both parties are bound by the terms and conditions
of the contracts they entered into.

2. HOW IS THE PRINCIPLE OF AUTONOMY RELATED TO CHOICE OF LAW

STIPULATIONS?
Principle of Autonomy of contracts allows the parties to stipulate the law that shall
govern their contractual relation. The parties can now then select which choice of law will
govern their relationship and that is beneficial for them to achieve their objectives or goals, if
it is a foreign law or a local law. In case of dispute, with the determination of the choice of law,
it will be easier and clear as to who has jurisdiction over the case.

3. WHAT WILL HAPPEN IN SITUATIONS OF FORCE MAJEURE AND PANDEMICS?

The Supreme Court already held that force majeure may either be an act of God, or
natural occurrences such as floods or typhoons, or an act of man, such as riots, strikes or
wars, however not all situations falls into these categories. The COVID-19 pandemic has made
the force majeure clauses relevant to protect the interests and the rights of everyone. The
International Chamber of Commerce (ICC) made a guidelines that the parties in a contract
can follow. The ICC Force Majeure Clause contains provisions on definitions, non-
performance, presumed force majeure events, consequences of force majeure and contract
termination. It balances the business people’s legitimate expectations of performance with the
reality that circumstances change, making performance so hard that the contracts simply must
change.

4. WHAT IS WAIVER OF RENVOI? EXPLAIN.

Renvoi takes place when the conflicts rule of the forum makes a reference to a
foreign law, but the foreign law is found to contain a conflict rule that returns or refers the
matter back to the law of the forum. However, to avoid complications, parties may waive the
application of renvoi in case the same is provided by a foreign law. Since a foreign law is
chosen by the parties, the rules of private international law will find no application.

5. WHAT PRINCIPLE DOES THE PHILIPPINES FOLLOW IN SITUATION OF CONFLICT

OF LAWS RELATING TO CONTRACTS? EXPLAIN.
Under the doctrine of forum non conveniens, a Philippine court in a conflict-of-laws
case may assume jurisdiction if it chooses to do so, provided, that the following requisites
are met: (1) that the Philippine Court is one to which the parties may conveniently resort to;
(2) that the Philippine Court is in a position to make an intelligent decision as to the law and
the facts; and (3) that the Philippine Court has or is likely to have power to enforce its
decision.

6. WRITE A DIGEST FOR EVERY CASE CITED IN THE CHAPTER. EXPLAIN THE
DOCTRINE FOR EACH AND EVERY CASE.
VILLARUZ, SHIELA MAE G.
CONFLICT OF LAWS
JD 3-3

1. BAGONG FILIPINAS OVERSEAS CORPORATION v. NATIONAL LABOR RELATIONS

COMMISSION
G.R. No. L-66006, February 28, 1985
FACTS
The shipboard employment contract dated was executed in the Philippines between Pancho
and Bagong Filipinas Overseas Corporation, the local agent of Golden Star Shipping. It was
approved by the defunct National Seamen Board. Pancho was hired as an oiler in the M/V
Olivine for 12 months with a gross monthly wage of US $195.
Pancho had a cerebral stroke. He was rushed to the hospital while the vessel was docked at
Sweden. He was repatriated to the Philippines and confined at the San Juan de Dios Hospital.
He died on December 13, 1979.
The National Seamen Board awarded his widow, Proserfina, P20,000 as disability
compensation benefits pursuant to the above-mentioned employment contract plus P2,000 as
attorney's fees.
Proserfina appealed to the National Labor Relations Commission which awarded her $621
times 36 months or its equivalent in Philippine currency plus 10% of the benefits as attorney's
fees. Golden Star Shipping assailed that decision by certiorari.

ISSUE
Whether the shipboard employment contract or Hongkong law should govern the amount of
death compensation due to the wife of Guillermo Pancho who was employed by Golden Star
Shipping, Ltd., a Hongkong based firm.

RULING
The Supreme Court hold that the shipboard employment contract is controlling in this case.
The contract provides that the beneficiaries of the seaman are entitled to P20,000 "over and
above the benefits" for which the Philippine Government is liable under Philippine law.

Hongkong law on workmen's compensation is not the applicable law. The case of Norse
Management Co. vs. National Seamen Board, G. R. No. 54204, September 30, 1982, 117
SCRA 486 cannot be a precedent because it was expressly stipulated in the employment
contract in that case that the workmen's compensation payable to the employee should be in
accordance with Philippine Law or the Workmen's Insurance Law of the country where the
vessel is registered "whichever is greater".

DOCTRINE: The parties are free to stipulate the terms and conditions that is convenient
provided that they are not contrary to law, morals, good customs, public order and public
policy. These stipulations shall govern the contractual relationship between parties.

2. ATIENZA VS. PHILIMARE SHIPPING

176 SCRA 325, 1989
FACTS
VILLARUZ, SHIELA MAE G.
CONFLICT OF LAWS
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Joseph B. Atienza was engaged by Philimare Shipping and Equipment Supply, as agent for
Trans Ocean Liner Pte. Ltd. of Germany, based on Singapore, to work as Third Mate on board
the MV Tibati for the stipulated compensation of US$850.00 a month from January 20, 1981
to January 20, 1982. The, Crew Agreement signed by the parties, provided for insurance
benefits "as per NSB Standard Format" and was validated and approved by the National
Seamen Board.
Atienza died as a result of an accident which befell him while working on the vessel in Bombay,
India. In due time, his father, the herein petitioner, filed a claim for death benefits computed at
the rate of 36 months times the seaman's monthly salary plus ten per cent thereof in
accordance with the Workmen's Compensation Law of Singapore. The, private respondents,
while admitting liability, contended that this was limited to only P40,000.00 under Section D(1)
of the NSB Standard Format.
The Philippine Overseas Employment Administration sustained the private respondent and
held that the applicable law was Philippine law. On appeal, the decision was affirmed by the
National Labor Relations Commission except that it increased the award to P75,000.00
pursuant to NSB Memorandum Circular No. 71, Series of 1981.

ISSUE
Whether or not Singaporean law should apply.

RULING
No, it is clearly stated in the Crew Agreement that the insurance benefits shall be "as per NSB
Standard Format," in the event "of death of the seaman during the term of his contract, over
and above the benefits for which the Philippine Government is liable under Philippine law.
The petitioner argues that the Standard Format prescribed only the minimum benefits and
does not preclude the parties from stipulating for higher compensation. That may be true
enough. But the point is that the parties in this case did not provide for such higher benefits
as the parties did in the Norse case. There was no stipulation in the Crew Agreement of
January 3, 1981, that the employee would be entitled to whichever greater insurance benefits
were offered by either Philippine law or the foreign law; on the contrary, it was plainly provided
that insurance benefits would be determined according to the NSB Standard Format then in
force. The consequence is that the petitioner cannot now claim a higher award than the
compensation prescribed in the said format.

DOCTRINE: Parties are free to stipulate the terms and conditions in the agreement and are
expected to follow these terms and condition. These stipulations shall constitute the law
between the parties and will be applied in case of dispute.

3. PAKISTAN INTERNATIONAL AIRLINES VS. BLAS OPLE

G.R. No. 61594, September 1990
FACTS
Pakistan International Airlines Corporation ("PIA"), a foreign corporation licensed to do
business in the Philippines, executed in Manila two (2) separate contracts of employment, one
with private respondent Ethelynne B. Farrales and the other with private respondent Ma. M.C.
Mamasig. Respondents then commenced training in Pakistan. After their training period, they
began discharging their job functions as flight attendants, with base station in Manila and flying
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assignments to different parts of the Middle East and Europe. Roughly one year and four
months prior to the expiration of the contracts of employment, PIA sent separate letters both
to private respondents Farrales and Mamasig advising both that their services as flight
stewardesses would be terminated "effective 1 September 1980, conformably to clause 6 (b)
of the employment agreement they had executed with PIA.
Private respondents Farrales and Mamasig jointly instituted a complaint for illegal dismissal
and non-payment of company benefits and bonuses, against PIA with the then Ministry of
Labor and Employment (MOLE)
Regional Director Estrella ordered the reinstatement of private respondents with full
backwages or, in the alternative, the payment to them of the amounts equivalent to their
salaries for the remainder of the fixed three-year period of their employment contracts. The
Order stated that private respondents had attained the status of regular employees after they
had rendered more than a year of continued service; that the stipulation limiting the period of
the employment contract to three (3) years was null and void as violative of the provisions of
the Labor Code and its implementing rules and regulations on regular and casual employment;
and that the dismissal, having been carried out without the requisite clearance from the MOLE,
was illegal and entitled private respondents to reinstatement with full backwages.
On appeal, Hon. Leogardo, Jr., Deputy Minister, MOLE, adopted the findings of fact and
conclusions of the Regional Director and affirmed the latter's award save for the portion thereof
giving PIA the option, in lieu of reinstatement to pay each of the complainants their salaries
corresponding to the unexpired portion of the contract of employment.

ISSUE
Whether the Pakistani Law is the applicable law.

RULING
No, a contract freely entered into should, of course, be respected, as PIA argues, since a
contract is the law between the parties. The principle of party autonomy in contracts is not,
however, an absolute principle. The rule in Article 1306, of our Civil Code is that the contracting
parties may establish such stipulations as they may deem convenient, "provided they are not
contrary to law, morals, good customs, public order or public policy." Thus, counter-balancing
the principle of autonomy of contracting parties is the equally general rule that provisions of
applicable law, especially provisions relating to matters affected with public policy, are deemed
written into the contract.The law relating to labor and employment is clearly such an area and
parties are not at liberty to insulate themselves and their relationships from the impact of labor
laws and regulations by simply contracting with each other.
Petitioner PIA cannot take refuge in paragraph 10 of its employment agreement which
specifies, firstly, the law of Pakistan as the applicable law of the agreement and, secondly,
lays the venue for settlement of any dispute arising out of or in connection with the agreement
"only [in] courts of Karachi Pakistan". The first clause of paragraph 10 cannot be invoked to
prevent the application of Philippine labor laws and regulations to the subject matter of this
case, i.e., the employer-employee relationship between petitioner PIA and private
respondents. The Court already pointed out that the relationship is much affected with public
interest and that the otherwise applicable Philippine laws and regulations cannot be rendered
illusory by the parties agreeing upon some other law to govern their relationship. Neither may
petitioner invoke the second clause of paragraph 10, specifying the Karachi courts as the sole
venue for the settlement of dispute; between the contracting parties. Even a cursory scrutiny
of the relevant circumstances of this case will show the multiple and substantive contacts
between Philippine law and Philippine courts, on the one hand, and the relationship between
the parties, upon the other: the contract was not only executed in the Philippines, it was also
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performed here, at least partially; private respondents are Philippine citizens and respondents,
while petitioner, although a foreign corporation, is licensed to do business (and actually doing
business) and hence resident in the Philippines; lastly, private respondents were based in the
Philippines in between their assigned flights to the Middle East and Europe. All the above
contacts point to the Philippine courts and administrative agencies as a proper forum for the
resolution of contractual disputes between the parties. Under these circumstances, paragraph
10 of the employment agreement cannot be given effect so as to oust Philippine agencies and
courts of the jurisdiction vested upon them by Philippine law.

DOCTRINE: The principle of party autonomy in contracts is not an absolute principle. Though
parties are free to stipulate the terms and conditions in a contract, those terms and condition
should not be contrary to law, morals, good customs, public order or public policy.

4. ERIE INSURANCE EXCHANGE V. EDMUND D. HEFFERNAN II

(925 A.2d 636 [Md. 2007])
FACTS
Mallory Heffernan, a minor, was fatally injured in an automobile accident; she subsequently
died. The decedent and other teenager passengers, all Maryland residents, had driven from
Maryland to Pennsylvania after school to attend a concert in Allentown, Pennsylvania that
night. After the concert, they began to make their way back to Maryland. On their way back,
driving through Delaware, the accident occurred. At the time of the accident, the Decedent's
parents, Edmund and Diane Heffernan, carried a Pioneer Family Auto Policy with. These are
Maryland policies, designed to comply with Maryland mandatory insurance requirements,
which included underinsured motorists coverage in the amount of $300,000 per person/
$300,000 per accident; the catastrophe policy provided $1,000,000 in underinsured motorists
coverage. It is agreed that the vehicle driven by Mr. McMahon was an underinsured motor
vehicle with respect to the Erie policy.
The Heffernans and Erie were unable to come to an agreement on issues of liability and the
amount of benefits to be paid, and the Heffernans filed suit against Erie in the Circuit Court for
Baltimore City, Maryland, seeking damages pursuant to the underinsured motorists coverage.
The underinsured motorists coverage in the Erie policies provided, in part that Erie would pay
damages (up to the applicable limits) “that the law entitles you” to recover from the owner or
operator of an underinsured motor vehicle. The Heffernans have asserted that Maryland's
non-economic damages cap does not limit the damages available to them. In addition, the
Heffernans assert that Delaware's tort law including the comparative negligence doctrine
should be applied to determine whether, and to what extent, they are entitled to recover from
the uninsured motorist. Erie contends that Maryland law, including the doctrines of contributory
negligence and assumption of risk, should be applied.

ISSUE
Whether the Maryland law or Delaware Law governs the claims of the Heffermans.

RULING
Delaware law is the applicable law in this case. Generally, in a conflict-of-laws situation, a
court must determine at the outset the nature of the problem presented to it for solution,
specifically, if it relates to torts, contracts, property, or some other field, or to a matter of
substance or procedure. Accordingly, the Court addressed the nature of an action by an
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insured against his own insurer for uninsured motorist benefits. The action by the insured
against the insurer is a contract action. Recovery is based upon the element of tortious
conduct, in this case, the negligence of a third party.
Both the Heffernans and Erie concede that the automobile insurance policy issued to the
Heffernans by Erie was issued, delivered and executed in Maryland and is, therefore, a
Maryland contract. To that end, for choice of law purposes, the Court generally would apply
Maryland law to decide questions of the interpretation and validity of the policies issued by
Erie to the Heffernans. Because the nature of the problem relates to tort, rather than contract
principles, the Court based it on the tort choice of law principles, namely, the law of the place
of the accident to answer the question. In that regard, Delaware is the place of the tort and the
place of injury.
Maryland law is clear that in a conflict of law situation, such as the one presented in the case
sub judice, “where the events giving rise to a tort action occur in more than one State, we
apply the law of the State where the injury-the last event required to constitute the tort
occurred.” This principle is lex loci delicti. Consistent with the principle of lex loci delicti,
because the automobile collision occurred in Delaware, under Maryland law, a Maryland Court
would apply the substantive tort law of Delaware to determine what the claimants are “entitled
to recover” in an action for uninsured motorist benefits.

DOCTRINE: In Lex loci contractus or the law of the place where the contract is executed, if
the parties did not specified which choice of law shall govern the contract, it is understood that
the parties wanted the local law to govern their contractual relationship

5. GOVERNMENT VS. FRANK

G.R. No. 2935, March 23, 1990
FACTS
In 1903, in the city of Chicago, Illinois, Frank entered into a contract for a period of 2 years
with the Plaintiff, by which Frank was to receive a salary as a stenographer in the service of
the said Plaintiff, and in addition thereto was to be paid in advance the expenses incurred in
traveling from the said city of Chicago to Manila, and one-half salary during said period of
travel. Said contract contained a provision that in case of a violation of its terms on the part of
Frank, he should become liable to the Plaintiff for the amount expended by the Government
by way of expenses incurred in traveling from Chicago to Manila and the one-half salary paid
during such period.
Frank entered upon the performance of his contract and was paid half-salary from the date
until the date of his arrival in the Philippine Islands. Thereafter, Frank left the service of the
Plaintiff and refused to make a further compliance with the terms of the contract.
The Plaintiff commenced an action in the CFI-Manila to recover from Frank the sum of money,
which amount the Plaintiff claimed had been paid to Frank as expenses incurred in traveling
from Chicago to Manila, and as half-salary for the period consumed in travel. It was expressly
agreed between the parties to said contract that Laws No. 80 and No. 224 should constitute a
part of said contract. To the complaint of the plaintiff the defendant filed a general denial and
a special defense, alleging in his special defense that the Government of the Philippine Islands
had amended Laws No. 80 and No. 224 and had thereby materially altered the said contract,
and also that he was a minor at the time the contract was entered into and was therefore not
responsible under the law.

ISSUE
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Whether or not the defendant can put up the defense of minority.

RULING
No, the record discloses that, at the time the contract was entered into in the State of Illinois,
he was an adult under the laws of that State and had full authority to contract. It is not disputed
— upon the contrary the fact is admitted — that at the time and place of the making of the
contract in question the defendant had full capacity to make the same. No rule is better settled
in law than that matters bearing upon the execution, interpretation and validity of a contract
are determined by the law of the place where the contract is made. Matters connected with its
performance are regulated by the law prevailing at the place of performance. Matters
respecting a remedy, such as the bringing of suit, admissibility of evidence, and statutes of
limitations, depend upon the law of the place where the suit is brought.

DOCTRINE: Capacity to contract is generally governed by the national law of the parties.
Thus, if there is an issue as to whether or not a person is capable of entering a contract, there
is a need to look at the national law of a person in determining their capacity to contract.

6. IN RE KMH
169 P.3d 1025 [2007]
FACTS
S.H., an unmarried woman wanted to become pregnant through artificial insemination (AI). D.H.,
an unmarried male friend of S.H., agreed to be the sperm donor. There was no formal written
contract between the parties regarding the role D.H. would play, if any, with the child. As a result
of the artificial insemination process, which took place in Missouri, S.H. became pregnant and
gave birth to twin daughters. Thereafter, S.H. and D.H. had a falling out and D.H. claimed he had
an oral agreement with S.H. to act as the twins’ father. S.H. filed a consolidated child in need of
care (CINC) action. D.H. filed an action to determine that he was the genetic father of the twins
and had paternal rights. The district court granted S.H.’s motion to dismiss holding that the
Kansas’s artificial insemination statute was controlling and constitutional. The statute stated that
unless the donor and the woman agreed otherwise in writing, the donor of semen for use in
artificial insemination of a woman other than the donor’s wife does not have any parental rights
to the child thereby conceived. D.H. appealed.

ISSUE
Whether Kansas law or Missouri law governs in the CINC and paternity suits between SH and
DH.

RULING
Kansas law applies. The United States Supreme Court has held that in deciding
constitutional choice-of-law questions, whether under the Due Process Clause or the Full
Faith and Credit Clause, this Court has traditionally examined the contacts of the State,
whose law was applied, with the parties and with the occurrence or transaction giving rise
to the litigation. Various factors are relevant to a choice-of-law determination, including the
procedural or substantive nature of the question involved, the residence of the parties
involved, and the interest of the State in having its law applied.
The parties in this case are Kansas residents. Whatever agreement that existed between
the parties was arrived at in Kansas, where they exchanged promises supported by
consideration, and D.H. literally delivered on his promise by giving his sperm to S.H. The
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twins were born in Kansas and reside in Kansas. The only fact tying any of the participants
to Missouri is the location of the clinic where the insemination was performed.
Under these circumstances, the Court held that Kansas law applies and that significant
contacts and a significant aggregation of contacts with Kansas make application of the law
to the parties' claims not only appropriate but also constitutional. This choice is neither
arbitrary nor unfair; neither party would have been justified in expecting Missouri to have a
controlling interest as to any dispute between them.

DOCTRINE: In addressing the issue of applicable law in contractual disputes, one principle
is the state of the most significant relationship rule or law of the place with the most
connection to the dispute. The more factors connected to the case the easier it is to
determine the rights and obligations of the parties to the contract.

7. TRIPLE EIGHT INTEGRATED SERVICES, INC. VS. NLRC

G.R. No. 129584, December 3, 1998
FACTS
Private respondent Osdana was recruited by petitioner for employment with the latters
principal, Gulf Catering Company (GCC), a firm based in the Kingdom of Saudi Arabia. Under
the original employment contract, Osdana was engaged to work as Food Server.
Petitioner asked Osdana to sign another Contractor-Employee Agreement which provided that
she would be employed as a waitress for twelve (12) months with a salary of two hundred
eighty US dollars ($280). It was this employment agreement which was approved by the
Philippine Overseas Employment Administration (POEA). Osdana left for Riyadh, Saudi
Arabia, and commenced working for GCC. Because of the long hours and the strenuous
nature of her work, Osdana suffered from numbness and pain in her arms. The pain was such
that she had to be confined at the Ladies Villa, a housing facility of GCC, during which period,
she was not paid her salaries.
After said confinement, Osdana was allowed to resume work. Again, she was not
compensated. Osdana was again confined at the Ladies Villa for no apparent reason. During
this period, she was still not paid her salary. She was re-assigned to the Oleysha University.
As with her previous assignment at the said University, Osdana worked long hours and under
harsh conditions. Because of this, she was diagnosed as having Bilateral Carpal Tunnel
Syndrome, a condition precipitated by activities requiring repeated flexion, pronation, and
supination of the wrist and characterized by excruciating pain and numbness in the arms.cr
As the pain became unbearable, Osdana had to be hospitalized. She underwent two surgical
operations. Between these operations, she was not given any work assignments even if she
was willing and able to do light work in accordance with her doctor’s advice. Again, Osdana
was not paid any compensation. After her second operation, Osdana was discharged from the
hospital. Four days later, however, she was dismissed from work, allegedly on the ground of
illness. She was not given any separation pay nor was she paid her salaries for the periods
when she was not allowed to work.
Upon her return to the Philippines, Osdana sought the help of petitioner, but to no avail. She
was thus constrained to file a complaint before the POEA against petitioner, praying for unpaid
and underpaid salaries, salaries for the unexpired portion of the employment contract, moral
and exemplary damages and attorney’s fees, as well as the revocation, cancellation,
suspension and/or imposition of administrative sanctions against petitioner. The case was
transferred to the arbitration branch of the NLRC and assigned to Labor Arbiter Canizares.
In a decision dated August 20, 1996, the labor arbiter ruled in favor of Osdana.
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ISSUE
Whether or not the Philippine law governs the private respondent’s dismissal from
employment.

RULING
Philippine law is applicable in this case. Petitioner consistently asserted that Osdana was
validly repatriated for medical reasons, but it failed to substantiate its claim that such
repatriation was justified and done in accordance with law. The manner by which Osdana was
terminated was clearly in violation of the Labor Code and its implementing rules and
regulations.

GCC argued that the requirement of medical certificate from public health authority was
physically impossible to comply with since Osdana was employed in Saudi Arabia and not in
the Philippines so there was no way for them to get the alluded medical certificate from a
Philippine public health authority. But SC held that the rule simply prescribes a “certification
by a competent public health authority” and not a “Philippine health authority.” Also, the
argument that Saudi Arabia laws should apply is not obtaining. Established is the rule that lex
loci contractus (the law of the place where the contract is made) governs in this jurisdiction.
There is no question that the contract of employment in this case was perfected here in the
Philippines. Therefore, the Labor Code, its implementing rules and regulations, and other laws
affecting labor apply in this case. Furthermore, settled is the rule that the courts of the forum
will not enforce any foreign claim obnoxious to the forum’s public policy

DOCTRINE: Lex loci contractus or the law of the place where the contract is made. The law
of the place of execution is the default law.

8. HASEGAWA v. KITAMURA
G.R. No. 149177, November 23, 2007
FACTS:

Nippon, a Japanese consultancy firm entered into a one-year ICA contract with Kitamura, a
Japanese national permanently residing in the Philippines. On February 2000, Kitamura was
informed that Nippon is no longer renewing his ICA and his services would only be utilized
until March 31, 2000. Aggrieved, Kitamura now filed an action for specific performance and
damages with the RTC of Lipa City. Nippon filed a motion to dismiss. The trial and appellate
court ruled in favor of Kitamura, hence this petition.

ISSUE:
Whether or not the RTC of Lipa City has jurisdiction for contracts executed by and between
two foreign nationals in foreign country wholly written in a foreign language?

RULING:
Yes. In the judicial resolution of conflict problems, 3 consecutive phases are involved:
jurisdiction, choice of law, and recognition and enforcement of judgments. Jurisdiction and
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choice of law are two different concepts. Jurisdiction considers whether it is fair to cause a
defendant to travel to this state; choice of law asks the further question whether the application
of a substantive law which will determine the merits of the case is fair to both parties. The
power to exercise jurisdiction does not automatically give a state a constitutional authority to
apply forum law.

DOCTRINE: Under the “state of the most significant relationship rule,” to ascertain what state
law to apply to a dispute, the court should determine which state has the most
substantial connection to the occurrence and the parties. In a case involving a contract, the
court should consider where the contract was made, was negotiated, was to be performed,
and the domicile, place of business, or place of incorporation of the parties.