Navigating The Boundaries - Public Policy In Private International Law
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Category: General Law
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NAVIGATING THE BOUNDARIES: PUBLIC POLICY IN
PRIVATE INTERNATIONAL LAW
Himanshu Mukim, O.P. Jindal Global University
ABSTRACT
The public policy doctrine within the realm of Private International Law has frequently been described as lacking clarity and exhibiting ambiguity. This response paper endeavors to analyze the common law interpretation of this doctrine from a theoretical standpoint with the following objectives: firstly, to assess the theoretical justifiability of the substantive factors that courts have invoked under the public policy doctrine, and secondly, to establish coherent limitations on the courts' utilization of this defense. By scrutinizing case law and drawing insights from the works of various legal scholars, notably Mills, Cheng, and Prof. Kosters, this article posits a set of principles that can serve as the theoretical foundation for public policy doctrine. Furthermore, it will explore how these principles can offer practical guidance to judges when applying the public policy doctrine.
Necessitating the requirement of limitations In private international law, state discretion prevails unless constrained by international treaties. It views private international law through the "local law" paradigm, extending it from domestic law, subject to the local legal system's discretion for domestic policy goals and political constraints. However, it's crucial to differentiate between international discretion and inherent discretion within laws. Some states may enact laws to provide predictability for private entities, limiting judicial authority to uphold specific domestic principles like justice and fairness. 1 Not confusing a public policy exception with a discretionary rule is vital. Overuse of public policy exceptions, seen in certain U. S. court rulings, can overshadow private international law principles, effectively transforming them into public policy doctrine.
This approach may conflict with the English constitutional rule of law, particularly when statutes establish criteria for choosing applicable law or recognizing judgments reflecting parliamentary ideology. 2 Therefore, exercising caution in applying public policy is essential to avoid undermining legislative intent. Even when choice-of-law or judgment recognition principles stem from common law and were shaped by English courts, their adherence remains a constitutional requirement. Excessive reliance on public policy exceptions could undermine the authority of past decisions that established these norms, potentially eroding the doctrine of precedent through broad exceptions.
This method indirectly acknowledges that choice-of-law and judgment recognition processes represent their public policies by basing the application of foreign law or the adoption and enforcement of foreign judgments on policy concerns. Any public policy established by discretionary exceptions, whether through legislative or judicial procedures, must be assessed against the intrinsic public policy of the norm and the constitutional validity behind its adoption. Uncontrolled execution of public policy jeopardizes other crucial public programs and fundamental societal values. 3 Are the boundaries all set? To establish guiding principles for applying public policy in private international law, it's
1 WW Cook, “The Logical and Legal Bases of the Conflict of Laws” (1924) 33 Yale Law Journal 457.
2 A Briggs, "Foreign Judgments and Human Rights" (2005) 121 Law Quarterly Review 185
3 AV Dicey, Introduction to the Study of the Law of the Constitution (London, Macmillan, 8th edn, 1915). crucial to understand its role within this framework. Treating public policy as a unique form of choice-of-law regulation has limitations. In private disputes, choice-of-law standards establish the appropriate law. English public policy often correlates with English legislation when it meets these conditions. Public policy, which prioritizes local norms over foreign ones, becomes vital when foreign legislation is selected. It serves as an exceptional rule that deviates from accepted choice-of-law standards. Public policy pertains to the recognition and enforcement of foreign judgments and examines the substance of the applicable legislation. It has enormous repercussions to see public policy as an exception to the rule of choice of law.
This strategy is consistent with justifications for limiting state action under private international law. 4 Determining which legal system has the most pronounced "interest" or "proximity" in a dispute, granting regulatory authority, is key to choice-of-law questions. Globally, "interest" has several meanings. Some regulations use an open-textured strategy that lets judges determine closeness on their own. For instance, many U. S. techniques require a comparable interest analysis without a party's choice of law in contract disputes while taking into account several criteria. On the other hand, some laws establish paramount interest by unchanging standards, as in the case of legislation relating to property. The parties' choice of applicable law in a contractual choice-oflaw clause must respect the independence of contract law. Some rules combine components with fixed and open textures.
The lex locus delicti rule in torts is combined with a broad exemption5. The proximity of the issue matters because invoking local law or public policy needs justification. There must be a discernible connection, supported by the belief that the forum state has a compelling reason to regulate. Public policy's use depends on connecting factors. Stronger interest supports broader application, while weaker interest requires stricter constraints. Importantly, a dispute governed by foreign law may concern parties beyond the forum. This offers a way to select the governing law after invoking public policy. Ideally, the court should set aside conflicting provisions and apply the remaining law. If not possible, English substantive law is applied.
A better approach involves evaluating which state has the 4 P Lagarde, "Public Policy," ch 11, in K Lipstein (ed), International Encyclopedia of Comparative Law, Vol III: Private International Law (Dordrecht, Martinus Nijhoff, 1994), 59ff.
5 American Law Institute, Restatement (Second) of the Conflict of Laws (1969) s 6
next substantial stake in regulating the dispute, justifying its substantive law as a "subsidiary" choice-of-law rule6. "Absolute" rules apply both locally and within the foreign legal system, diminishing their relevance. Bilateral sharing of public policy occurs when two states share the same policy, justifying its application when one state's law contravenes it. Regional sharing pertains to fundamental norms embraced by all member states, as exemplified by the European Convention on Human Rights. Public policy can occasionally be categorized as absolute, primarily stemming from vital national interests. In practice, norms frequently exhibit degrees of relativity influenced by factors like ongoing disputes, interpretative latitude, and the concept of the "margin of appreciation". Highly relative public policy necessitates strong dispute-forum proximity.
Shared or absolute public policy doesn't mandate stringent restrictions, as it prioritizes one norm over another. 7 Limitations may still exist within universal or unalterable rules, particularly when alternative compliance methods are available. Contentious topics revolve around assessing compliance, mutual trust, and alternative enforcement mechanisms for foreign judgments contravening internationally recognized human rights principles. These considerations influence public policy application, contingent on dispute proximity, norm applicability, trust between parties, and institutional deference. Striking the right Chord In the domain of international jurisprudence, the intricate balance between fundamental human rights, societal norms, and the necessity of adhering to the public policy doctrine when recognizing judgments and legislation presents a complex challenge.
A deeper comprehension of how the public policy theory maintains this intricate equilibrium can be gained by scrutinizing the regulatory framework governing foreign judgments and laws. It becomes evident that the universal principles of international law, often invoked to justify recognizing foreign judgments and laws, can offer valuable ethical guidelines for shaping the contours of the public policy theory. Therefore, it is reasonable to assert that the criteria for non-recognition 6 O Kahn-Freund, “Reflections on Public Policy in the English Conflict of Laws” (1954) 39 Transactions of the Grotius Society 39, 58. 7 DC Burger, "Transnational Public Policy as a Factor in Choice of Law Analysis" (1984) 5 New York Law School Journal of International and Comparative Law 370, 374ff.
and non-enforcement of foreign judgments and laws based on public policy should align with these standards due to their foundational significance. In theory, proposing a set of priori principles that provide a structured framework for the judicious use of the public policy doctrine by courts is plausible. This discussion reiterates two universally applicable normative principles, drawing insights from legal scholar Kenny Chng. Firstly, any judgment or legislation violating fundamental and universally recognized moral standards mustn't be acknowledged in any nation within the international community. This is in line with the core tenets of the philosophy of public policy, which upholds a universal norm of fairness.
It follows logically that this standard must be consistent with other universal justice norms if one accepts the premise that the basis for accepting foreign judgments and laws is built in a norm supporting international conflict settlement for the sake of justice. These worldwide legal norms widely accepted national traditions, and self-evident natural justice principles identified via logical analysis all make clear these universal justice standards. The reality of this idea is supported in practice by historical examples of judicial applications of public policy based on fundamental moral principles. 8 Such criteria have repeatedly been used by judges as justification for using the public policy theory to overturn foreign rulings and laws.
This first principle may also be seen as a practical embodiment in the public policy doctrine's use of John Stuart Mill's relativity idea, which is more likely to be used when the applicable norm demonstrates basic and generally acknowledged applicability. This notion, while generally uncontroversial, becomes more intricate in the practical application of the public policy concept. Courts often extend beyond basic moral standards and delve into social moral standards, whether codified in legal statutes or not. This raises legitimate questions regarding the doctrine's justification. A second normative premise resonates in the context of public policy theory. Even within the more general framework of the international system, this idea recognizes national sovereignty.
This rule states that a foreign ruling or law may not be recognized if it endangers the fundamental institutions or community interests of the forum state. This idea is implicitly acknowledged in a sizable body of literature on public policy theory written by academics and jurists. For instance, the European Court of Justice argued in R v. Bouchereau that, within the framework of the European Union regime, the notion of public policy presupposes, in all cases, the existence of
8 J Finnis, Natural Law and Natural Rights (Oxford University Press, 2nd edn, 2011).
a real and sufficiently serious threat to the requirements of public policy, impacting one of society's fundamental interests, in addition to the disruption of social order inherent in any violation of the law. According to Sir Hersch Lauterpacht, the public policy theory acts as a vital "safety valve", enabling a state to avoid imposing foreign law when it clashes with the basic moral, legal, and political ideas that form the basis of the forum state's structure. Since its conception, this idea has been a fundamental part of private international law. Additionally, it is consistent with Mills' notion of proximity, which contends that judges are more likely to apply the public policy doctrine when the issue at hand is more directly related to the forum. 9 In the realm of private international law, this second principle is far from groundbreaking.
The concept of "forumnecessary norms" is a well-established doctrine that embodies this principle. The rationale for necessitating regulations by the forum to protect its local institutions holds when applied to foreign decisions. In essence, the presence of forum-required norms underscores the fundamental tenet within private international law of safeguarding domestic institutions. This principle can be extended to foreign judgments, creating symmetry between foreign judgments and choice-of-law scenarios. It is worth noting that the Rome I Regulation's definition of forum mandatory rules in Article 9(1) closely mirrors this second principle, characterizing them as "provisions whose respect is regarded by a country as crucial for safeguarding its public interests, such as its political, social, or economic organization".
Emphasizing that the two principles articulated by Chng serve as a priori defenses for the court's utilization of the public policy theory is pivotal at this juncture. It is contended that these principles find their normative foundation in the philosophical concept of subsidiarity. At its core, subsidiarity delineates a method for allocating authority within a hierarchical power structure. It advocates for a bottom-up system of social order, wherein entities at the lower rungs of the hierarchy should have the autonomy to pursue their objectives and flourish, with entities higher up the hierarchy refraining from stifling decisions made at the lower levels unless such interference is necessary to safeguard the overall interests of the hierarchical structure.
This system is rooted in the belief that individuals and lower-level entities possess the greatest insight into what is necessary for their well-being, thereby 9 A Boldizar and O Korhonen, “Ethics, Morals and International Law” (1999) 10 European Journal of International Law 279, 307–308. preserving human autonomy and conserving state resources10. Subsidiarity is a legal theory that contends that general rules of international law shouldn't interfere with sovereign states' right to self-government, save in the most extraordinary cases intended to uphold world order. The European Union's legal system provides a concrete illustration of how the subsidiarity principle functions on a global scale. Within the context of international governance, subsidiarity furnishes a normative basis for nations to retain a "margin of appreciation" to safeguard their institutions and communal interests.
Concurrently, it dictates that, in certain situations, prevailing principles of international law should supersede national policies to protect fundamental or universally recognized values, especially when fundamental human rights are in jeopardy. Consequently, the two a priori principles find their philosophical underpinnings and normative guidance in the concept of subsidiarity. Subsidiarity also offers insight into the interplay between these two principles. When applying the public policy doctrine, individual states should possess the latitude to determine the measures needed to safeguard the effective functioning of their local institutions. The judgments of individual states on this matter should only be deemed inconclusive in exceptional circumstances when there is doubt concerning fundamental and universal norms.
We may support the courts' practice of prioritizing the crucial variables described earlier in this exposition if we accept the idea that these principles serve as the theoretical underpinning for the public policy theory. As stated in the first principle, which is perfectly aligned with the judicial invocation of the public policy notion, a judgment or piece of law that goes against core moral standards shouldn't be accepted by the world community. Judges may refer to community norms, whether codified in law or other forms of expression, by using the second principle, which accords sovereign states the right to defend their community interests and institutions via the public policy theory. We can investigate the proposed relationship between the two principles, under the guidance of the subsidiarity principle, to evaluate the normative basis for the judges' choices in this instance.
For instance, the decision in Poh Soon Kiat by the Singapore Court of Appeal, where statutory public policy was given great weight, is principally supported because it offers better initial support for the significance of preserving the community norm11. 10 A Mills, “Federalism in the European Union and the United States: Subsidiarity, Private Law, and The Conflict of Laws” (2010) 32 University of Pennsylvania Journal of International Law 369, 406–408.
11 Yong Vui Kong v PP [2015] SGCA 11 (Singapore Court of Appeal decision).
Practicality of the Doctrine Identifying the theoretical basis of the public policy doctrine also guides shaping judicial practice and explaining the categories of norms invoked under this doctrine. The two Chng principles can offer more specific guidance to judges when employing the public policy theory, particularly when considering Mills' thesis alongside these principles. Mills argued that the applicability of public policy depends on the relativity, proximity, and gravity of the breach. Relativity, in the context of public policy, relates to the global acceptance of a particular norm. The likelihood of a court finding the public policy theory relevant for a certain norm depends on its level of international acknowledgment.
Proximity, as Mills posited, suggests that courts are more likely to apply the public policy theory when there is a strong connection between the issue at hand and the forum. This means that even if a norm lacks international consensus, courts may still rely on it under the public policy doctrine if it closely relates to the forum. Regarding the gravity of the breach, Mills emphasized that a judge's discretion in applying the public policy doctrine also considers the extent to which a specific norm has been violated12. Chng's study supports Mills' thesis by providing a theoretical explanation for how courts factor in relativity and proximity, aligning with Mills' research. However, Chng enhances Mills' argument in two keyways. Firstly, Chng underscores that a norm's strength is not solely determined by international consensus.
It is essential to focus on the basic and universal nature of the norm in question, not just international consensus. This aligns with the first principle's premise that moral standards like basic human rights are universal and do not require consensus to be binding. Fundamental human rights are universally applicable moral standards, and consensus arises from their universality. Chng emphasizes the importance of the norm's basic and universal quality to refine Mills' concept of relativity. Secondly, Mills' definition of proximity centers on whether it is appropriate to withhold recognition of a foreign decision or law to protect significant community interests and institutions. The second principle guides the factors relevant to courts when applying the public policy theory.
13 It is important to note that this investigation may benefit from considering how the UK Supreme Court approached the contractual basis of illegality in Patel v. Mirza. In Patel v. 12 A Mills, "The Dimensions of Public Policy in Private International Law" (2008) 4 Journal of Private International Law 201, 207-208. 13 Chng, Kenny. "A theoretical perspective of the public policy doctrine in the conflict of laws" (2018) Journal of Private International Law 14(1), 130-159. Research Collection Yong Pung How School of Law.
Mirza, Lord Toulson argued that the purpose of the public policy violated by the contract, other pertinent public policies, and whether such denial would be proportionate to the wrongdoing's nature and severity should all be considered when deciding whether to grant or deny a claim based on a contract tainted by illegality. The second principle discussed can also be very well led to the recognition of foreign judgments and legislation. The type of community moral norm at issue, whether sustaining it is a top priority for local institutions, and whether withholding recognition is a fair reaction to the transgression of this norm should all be considered by the courts. According to Mills, the employment of a proportionality approach in this area of law is consistent with the idea that courts should evaluate the seriousness of the violation.
There is a higher presumption of the essential character of these standards when they have been codified in common law or statute, but this examination applies to community norms articulated in both common law and legislation. 14 Conclusion In conclusion, the intricate tapestry of international jurisprudence, with its delicate interplay between fundamental human rights, societal norms, and the exigencies of the public policy doctrine in the recognition of foreign judgments and legislation, reveals a multifaceted challenge. This examination has delved into the underpinnings and practical implications of the public policy doctrine, drawing on both international legal precepts and the illuminating insights of legal scholars, most notably Mills and Chng.
The elucidation of two foundational normative principles emerges as a salient achievement in this discourse, providing a compass to navigate the judicious application of the public policy doctrine. Firstly, the principle dictating the non-recognition of judgments or legislation transgressing universally acknowledged moral standards seamlessly harmonizes with the essence of public policy—a beacon of universal justice. This principle finds empirical grounding in judicial practices where fundamental moral norms are cited as the basis for employing the public policy doctrine to eschew foreign legal impositions. Secondly, the principle accentuating the primacy of individual nation-states and the safeguarding of their fundamental institutions and communal interests through the public policy theory emerges as a pivotal tenet.
It underscores the legitimacy of withholding 14 A Mills, "The Dimensions of Public Policy in Private International Law" (2008) 4 Journal of Private International Law 201, 207-208. recognition when foreign adjudications or legal norms imperil the vital interests of the forum state- a concept reverberating with the notion of "forum-necessary norms. " This principle, resonant with established legal doctrines, seamlessly aligns with Mills' conceptual pillars of relativity, proximity, and gravity. Both these principles, ensconced within the philosophical embrace of subsidiarity, provide a normative scaffold upon which courts can deftly gauge the applicability of the public policy doctrine. They cast a spotlight on the foundational nature and universal applicability of norms, alongside the criticality of community interests and institutions in the decision-making calculus.
This analytical framework fosters a nuanced approach to evaluating public policy exceptions, wherein courts deliberate upon the relativity and proximity of the norm, focusing on its intrinsic universality while weighing the severity of the breach. A proportionality paradigm, reminiscent of Patel v. Mirza, guides courts in assessing whether the denial of recognition corresponds proportionately to the norm's transgression and the fortification of communal interests. In essence, this exploration has engendered a theoretical bedrock for the public policy doctrine and rendered cogent insights into its pragmatic application. It venerates universally acknowledged moral standards and the sovereignty of nations as cornerstones for shaping the contours of the public policy theory within the precincts of private international law.
By adhering to these normative touchstones, courts can ensure that the public policy doctrine is invoked judiciously, upholding the principles of justice, preserving state autonomy, and nurturing the integrity of international legal constructs. In this intricate dance of jurisprudence, the public policy doctrine emerges not as an impediment but as a sentinel guarding the hallowed realms of justice and sovereignty in the global arena.