The closest connection principle as escape clause for contractual legal relations of international character

Abstract

The article contains analysis of escape clause stipulated by Art. 1211-9 of the Civil Code of the Russian Federation and allowing the court, when choosing applicable law for contract, in ex ceptional cases to reject the conflict of laws rule prescribed by law in favor of the law which is obviously more connected to contract. The author conducts a case by case analysis of Russian judicial practice, including judicial acts in which application of escape clause is extensively substantiated and those in which such application is based on the sole counter-directed link of contract or is barely substantiated. Moreover, the examples of disaffirmation of judicial acts which have been based on unjustified application of Art. 1211-9 of the Civil Code of the Rus sian Federation as well as cases of illustrative utilization of the indicated provision are under analysis. The author pays special attention to the standard (criteria) of the closest connection principle applied under the auspices of escape clause for contractual legal relations of interna tional character. The author stands for thesis that the court recourse to escape clause of Art. 1211-9 of the Civil Code of the Russian Federation as an exceptional case requires ‘compara tive weighing’ of differently directed links of the exact contract culminating in clear conclu sion on sum of significant links to the law of other country in contrast to insignificant link to the law of country indicated by conflict of laws rule. At the same time, indicators (criteria) of the closest connection, stemming from unity of its contents even for different functions within conflict of laws framework, should embrace not only territorial contacts of the exact contrac tual legal relation but also important substantive law considerations (including lex validatis acknowledged by the Supreme Court of the Russian Federation).