Governing Law And Jurisdiction - Who Cares?

Most legal contracts contain standard "boiler plate" clauses buried at the end, one of which says something about choice of law and jurisdiction. Few clients attach much importance to it. The reason for this may be because contracting parties, on the threshold of a new life together, do not want to spoil the wedding day by squabbling over the terms of a pre-nup. The problem is, however, that the consequences of the wrong choice, or no choice, can be quite severe.

Governing Law

Governing law clauses establish which country's rules of interpretation and legal remedies apply. The governing law clause will be relevant in determining issues such as the validity of the original agreement and any amendments, the interpretation of clauses if there is uncertainty, whether there has been a material breach and the calculation of any damages.