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Reconsidering the Law Governing the Formation of International Contracts in Australia

Year of Publication: 2023
Month of Publication: 11
Author(s): A Arzandeh
Research Area(s): Private International Law
Journal Name: Melbourne University Law Review
Volume Number: 46
Issue Number: 3
Abstract:

This article revisits the question of what law governs the formation of international contracts from the perspective of the law in Australia. Ever since the High Court of Australia’s obiter decision in Oceanic Sun Line Special Shipping Co Inc v Fay in 1988, courts have maintained that Australian law, qua lex fori, should apply to formation questions. The article challenges the suitability of this choice-of-law rule and evaluates the possible ways of reframing this aspect of the law in Australia. e article’s main contention is that the lex fori should be replaced by a set of choice-of-law rules under which formation questions in international contracts are resolved based on: (i) the law expressly chosen by the parties to govern such matters; or (ii) in the absence of such express choice, the law of the territory which has the most real and substantial connection with the negotiations preceding the purported agreement.