Idiosyncratic Approaches to Enforcing Choice-of-Law Clauses

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On December 16, 2025, the Sixth Circuit decided Andujar v. Hub Group Trucking, Inc. The issue presented was whether the Tennessee Supreme Court had adopted Section 187 of the Restatement (Second) of Conflict of Laws as the test for determining whether a choice-of-law clause should be given effect as a matter of Tennessee common law. After reviewing the relevant state decisions, the Sixth Circuit concluded that it had not adopted this test:

In Goodwin Brothers, the Tennessee Supreme Court cited § 187(2) in a footnote when it adopted its own choice-of-law test. This citation supports the notion that Tennessee may have derived its choice-of-law test from the Restatement, but it does not show that Tennessee has adopted § 187(2). When Tennessee courts adopt provisions of the Restatement, they do so expressly. Tennessee has not expressly adopted § 187(2) of Restatement (Second) of Conflict of Laws (emphasis added).

This decision got me thinking about the enforcement rules in other U.S. states. After a bit of research, I determined that approximately twenty states have not adopted Section 187. In this post, I discuss how these states go about deciding whether a choice-of-law clause should be given effect.

Three caveats are in order. First, the question of whether a choice-of-law clause is enforceable is governed by state law. Accordingly, the discussion below focuses on state court decisions to the exclusion of federal court decisions. Second, as the decision in Andujar makes clear, it is not always clear whether a state has formally adopted Section 187 or merely follows a test derived from Section 187. Third, state practice is not always consistent. Although the Alabama Supreme Court clearly adopted Section 187 in 1991, for example, recent Alabama state court decisions omit any mention of it.

My review suggests that there are six distinct approaches to enforcing choice-of-law clauses outside of Section 187: (1) apply a reasonable relation test, (2) decline to enforce a clause when enforcement would be contrary to public policy; (3) combine the first two approaches; (4) offer general endorsements of choice-of-law clauses without stating a clear rule; (5) enforce a clause if the choice was made in good faith and without an intent to evade the law of the forum; and (6) ignore the clause. Each is discussed below.

Reasonable Relation
(3 states)

Some states have held that a choice-of-law clause may only be enforced when the chosen jurisdiction has a connection to the parties or the transaction. In Arkansas and the District of Columbia, there must be a “reasonable relation” to the chosen jurisdiction. In Hawaii, there must be some “nexus” with the parties or the contract.

Public Policy
(10 states)

Other states have held that a choice-of-law clause should not be given effect when it is contrary to public policy. These states do not consider whether the chosen jurisdiction has a connection to the parties or the transaction.

The Florida Supreme Court has held, for example, that “this Court will enforce a choice-of-law provision unless applying the chosen forum’s law would contravene a strong public policy of this State.” The Georgia Supreme Court has similarly held that “absent a contrary public policy, this court will normally enforce a contractual choice of law clause.” One can find statements to similar effect from state courts in Kansas, Louisiana, Missouri, New Mexico, South Carolina, South Dakota, Vermont, and Wisconsin.

The precise test used varies from state to state. Some courts refer to a “strong” public policy. Others refer to an “overriding” public policy or an “important” public policy. Still others merely refer to “public policy” without any qualifying language.

There is also some disagreement among these states as to whether it is appropriate to consider the public policy of a jurisdiction other than the forum. Most states have held that a choice-of-law clause is only unenforceable if it is contrary to the public policy of the forum. A handful have held, however, that a clause may not be enforced if it is contrary to the public policy of the state whose law would otherwise apply.

Reasonable Relation + Public Policy
(5 states)

Still other states have held that a choice-of-law clause is only enforceable if both of the criteria identified above are satisfied. In these states, enforcement is permitted if (1) the chosen jurisdiction has a reasonable relation to the parties or the transaction, and (2) enforcement would not be contrary to public policy. The states that have adopted this approach include Mississippi, Nevada, New York, Tennessee, and West Virginia.

Section 187 contemplates the possibility that a choice-of-law clause may be enforced in the absence of a connection between the jurisdiction and the parties or the transaction if there is a “reasonable basis” for choosing its law. This rule is not consistently followed in these five states. The West Virginia Supreme Court, for example, has cited the absence of any connection between the chosen jurisdiction and the parties or the transaction as a basis for non-enforcement even when there was a reasonable basis for selecting a jurisdiction.

In these five states, it may also not be enough to demonstrate a material connection between the chosen jurisdiction and the parties. It may be necessary to demonstrate a material connection between that jurisdiction and the transaction. In Andujar v. Hub Group Trucking, Inc., the Sixth Circuit declined to enforce a New Jersey choice-of-law clause even though the defendant operated multiple facilities in Tennessee and some of the contracts were executed in Tennessee. The court held that more was required to create a “material” connection between Tennessee and the parties’ transaction.

General Endorsements
(2 states)

Indiana and Virginia have not stated any test for assessing whether a choice-of-law clause should be given effect. The Indiana Supreme Court has merely held that state law “favors” choice-of-law clauses. The Virginia Supreme Court has likewise held that such clauses should “be applied.”

Good Faith and No Attempt to Evade
(1 state)

In Minnesota, the test for enforceability is very different from the test used in other states. The Minnesota Supreme Court has long held that it is “committed to the rule that the parties, acting in good faith and without an intent to evade the law, may agree that the law of either state shall govern.” This test was recently applied by the Minnesota Court of Appeals to determine whether a Finnish choice-of-law clause in a prenuptial agreement involving a NHL hockey star should be given effect.

Why is the Minnesota rule relating to enforcement so wildly at odds with the ones utilized in other states? The answer lies in the date of the relevant decision. The Minnesota Supreme Court adopted this rule in 1956 and has apparently never had occasion to revisit it. As a result, the test for enforceability in Minnesota harkens back to an earlier era when choice-of-law clauses were much less common and the Restatement (Second) was still being drafted.

Ignore the Clause
(1 state)

The State of Kentucky appears to be the only one whose courts ignore choice-of-law clauses when determining which law to apply. The Kentucky Supreme Court has held that state courts should apply Section 188 of the Restatement (Second) to determine which state has the “most significant relationship” with the parties and the transaction even when a contract contains a choice-of-law clause.

Why has the Kentucky Supreme Court decided to apply Section 188 to the exclusion of Section 187 in cases involving choice-of-law clauses? There is no obvious answer. Section 186 of the Restatement (Second) states that “[i]ssues in contract are determined by the law chosen by the parties in accordance with the rule of § 187 and otherwise by the law selected in accordance with the rule of § 188.” I can see no reason why a court committed the Restatement (Second) would choose to apply a rule of general application (§ 188) to the exclusion of a rule specifically keyed to choice-of-law clauses (§ 187) to assess whether a clause should be enforced. Nevertheless, this is the rule that the highest court in Kentucky has chosen to adopt. The practical effect of this decision is to render choice-of-law clauses legally irrelevant in Kentucky.

Conclusion

In past posts, I have expressed sympathy for foreign lawyers who must give advice to foreign clients with respect to litigation in the United States. Now seems an appropriate time to reiterate those sentiments. Choice-of-law clauses are ubiquitous in modern contracts. They play an increasingly important role in facilitating settlement and in streamlining the litigation process. There is, however, no single answer to the question: “When will a choice-of-law clause be enforced by a court in the United States?” As with so many issues in the United States, it depends on the state.