LEX LOCI
CONTRACTUS defined: contracts. The law of the place where an agreement is made.
2. Generally, the validity of a contract is to be decided by the law of the
place where, the contract is made; if valid, there it is, in general, valid
everywhere. Story, Confl. of Laws, Sec. 242, and the cases there cited. And
vice versa if void or illegal there, it is generally void everywhere. Id Sec.
243; 2 Kent Com. 457; 4 M. R. 584; 7 M. R. 213; 11 M. R. 730; 12 M. R. 475; 1
N. S. 202; 5 N. S. 585; 6 N. S. 76; 6 L. R. 676; 6 N. S. 631; 4 Blackf. R. 89.
3. There is an exception to the rule as to the universal validity of contracts.
The comity of nations, by virtue of which such contracts derive their force in
foreign countries, cannot prevail in cases where it violates the law of our own
country, the law of nature, or the law of God. 2 Barn. & Cresw. 448, 471.
And a further exception may be mentioned, namely, that no nation will regard or
enforce the revenue laws of another country. Cas. Temp. 85, 89, 194. 4. When the
contract is entered into in one place, to be executed in another, there are two
loci contractus; the locus celebrate contractus, and the locus solutionis; the
former governs in everything which relates to the mode of construing the
contract, the meaning to be attached to the expressions, and the nature and
validity of the engagement; but the latter governs the performance of the
agreement. 8 N. S. 34. Vide 15 Serg. & Rawle 84; 2 Mass. R. 88; 1 Nott
& M'Cord, 173; 2 Harr. & Johns. 193, 221; 2 N. H. Rep. 42; 5 Id. 401; 2
John. Cas. 355; 5 Pardes. n. 1482; Bac. Abr. Bail in Civil Causes, B 5; Com.
Dig. 545, n.; 1 Supp. to Ves. jr. 270; 8 Ves. 198; 5 Ves. 750.
The LAW OF
FLAG is a basic principle of maritime and international law. It states
that any ship or other vessel is governed by the laws of the nation whose flag
is flown by the vessel. This means that anyone who works on or boards the
vessel is subject to these laws.
Ships in
international waters are the primary places in which the law of the flag
applies. As no country's laws apply in these waters, each ship operates under
the legal system of the flag it sails under. When a vessel is docked in another
country, those aboard the vessel may be subject to local laws, although different
countries have their own rules about foreign vessels in their waters.
The existence of
the law of the flag is important, as many crews are made up of citizens of
different countries. A vessel generally flies the flag of the country in which
it is registered. Anyone who boards the vessel agrees to abide by the laws of
the vessel's country, regardless of their own nationality or the nationality of
the others on board. Theoretically, any breaches of a country's laws on board a
vessel that flies that country's flag may ultimately be prosecuted in the
courts of that country.
Owners of a
vessel may, in some cases, shop around to determine which country's flag to
fly. Many political and financial considerations can be involved in choosing
the country with which a vessel is to be registered. In these cases, a vessel's
owner may take the laws of a country into consideration when choosing which
flag to fly.
In some cases, a
person may temporarily lease a vessel from its owner. Often, this person will
be able to sail under a different flag than that of the country where the
vessel is registered. In these circumstances, the vessel flies the flag of the
lessee's country.
The law of the
flag may also apply to embassies, consulates, or other foreign government
offices. A place such as this is a bound area, generally contained within a
building or fenced area. It is considered part of the home country, and anyone
who enters it is subject to the laws of the country whose flag flies there.
The flag Is used,
in the prosecution of commerce upon the high seas, as a symbol of nationality.
Tha nationality of a ship is determined by the flag which it carries. A ship,
navigating under the flag and pass of a foreign country, is to be considered as
bearing the national character of the country under whose flag she sails. Under
what is called, in international law, “the law of the flag,” a shipowner who
sends his vessel into a foreign port gives notice by his flag to all who enter
into contracts with the ship-master, that he intends the law. of that flag to
regulate those contracts, and that they must either submit to its operation or
not contract with him or his agent at all. 185 111. 144.
Law of the Flag -
An expression applied to the municipal law of the country to which a ship
belongs of which the flag, is the symbol, when that law is resorted to in
preference to the lex loci contractus for the construction and effect of a
contract or the determination of a liability affecting the ship or her cargo.
The law of the flag
is "to regulate the liabilities and regulations which arise among the
parties to the agreement be it of affreightment or by hypothecation, upon this principle, that
the ship-owner who sends his vessel into a foreign port gives a notice by his
flag to all who enter into contracts with the shipmaster, that he intends the
law of that flag to regulate those contracts, and that they must either submit
to its operation or not contract with him or his agent at all;" Foote,
Priv. Int. L. 408
In his treatise
on merchant shipping (3rd ed. 170) MacLachlin states the rule as to the effect
of the law of the flag on the authority of the master. "The agency of the
master is devolved upon him by the law of the flag.
The same law that
confers his authority, ascertains its limits, and the flag at the mast-head is
notice to all the world of the extent of such power to bind the owners or
freighters by his act. The foreigner who deals with this agent has notice of
that law, and, if his be bound by it, there is no injustice. His notice is the
national flag which is hoisted on every sea and under which the master sails
into every port, and every circumstance that connects him with the vessel
isolates that vessel in the eyes of the world, and demonstrates his relation to
the owners and freighters as their agent for a specific purpose and with power
well defined under the national maritime law; "id.' this was suggested by
the author quoted as a possible explanation of the apparently anomalous
exception of bottomry bonds from the general rule that the lex loci contractus
prevails.
The very learned
judgment of Mr. Justice Story just referred to affords a complete answer to a
plausible argument in which was suggested that the general maritime law clothed
the master with power to bind his owners absolutely, and that the municipal law
of the owner's country was analogous to secret restrictions in the ostensible
authority of a partner or other agent clothed with general power."
In The Brantfort
City (S.D. of N. Y.) 29 Fed. 373, 383, Brown, J., this stated this rule:
"The 'law of the flag'...does not embody any rule of legal construction.
Literally, it is but a concise phrase to express a simple fact, namely, the law
of the country to which the ship belongs, and whose flag she bears, whether it
accords with the general maritime law or not. In so far , however, as the law
of the flag does not represent the general maritime law, it is but the
municipal law of the ship's home. It has, therefore, no force abroad, except by
comity. But foreign law is not adopted by comity, unless some good reason
appear in the particular case why it should be preferred to the law of the
former. The most frequent and controlling reasons are the actual or presumed
intent of the parties or evident justice of the case arising from the special
circumstances."
