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Choice of Law Clause

A choice of law clause, also known as proper law clause, is basically a contract term in which the parties specify that if disputes arise under the contract then they will be handled in accordance with the law of a particular jurisdiction, which may or may not be in the same city or state.

For example, if a married couple were joint owners of an investment and one of them dies disputes may arise regarding who inherits that investment due to survivorship. Children from a previous marriage may try to claim the investment under local state law if there were no expressed provision for survivorship. However, if there is a choice of law clause, the case could be tried under different state law where rights of survivorship are favored even without being expressly stated.

Please contact a professional Estate Administration Attorney if you have questions regarding clauses that may effect non-probate transfers.

*This blog entry was not written by an Attorney and should not be constituted as professional legal advice.