Say the ratio out loud before you open Reasoning — recalling it unprompted is exactly what the exam pays for.
Why it matters
It does two jobs in this paper, in two different modules. It is the authority on s. 13(f), the least discussed of the six exceptions; and it supplies the definition of the proper law of a contract that Module 4 is built on.
Facts
This course states the propositions the case lays down and does not set out its facts.
Held
On s. 13(f). A foreign judgment on a claim founded on a breach of any law in force in India may not be enforceable. However, where the judgment is based upon a contract having a different proper law, it may be enforced.
On the proper law. The proper law of contract means the law which the court is to apply in determining the obligation under the contract.
Reasoning
Step one — read clause (f) as a protection of Indian law. Conclusiveness fails where the foreign judgment sustains a claim founded on a breach of a law in force in India. The forum will not lend its machinery to enforce an obligation that exists only because Indian law was broken.
Step two — ask which law the claim was really founded on. If the contract's proper law is not Indian, the claim is founded on that other system, and the fact that performance would have been contrary to some Indian rule does not bring clause (f) into play.
Step three — note what the definition of proper law does and does not do. It says what the law is for — determining the obligations under the contract — and says nothing about where it comes from. That vacuum is filled by the three-tier ladder: express choice, implied choice, and the law imputed by the closest and most intimate connection.
Exam use
It opens: Explain s. 13(f) in Module 2, and Define the proper law of a contract in Module 4. Say that the same decision serves both, and you have shown the examiner that the modules connect.
In the Module 2 answer, place clause (f) last in the list of six and give this case as its only illustration, with the qualification about a different proper law.
In the Module 4 answer, use the definition to open and then build: Vita Food Products Inc. v. Unus Shipping Co. Ltd. for express choice, subject to the conditions that the intention be bona fide and legal and that there be no reason to avoid the choice on public policy grounds; British India Steam Navigation Co. v. Shanmugha Vilas Cashew Industries for the Indian limits and the residual power to strike down a wholly unconnected choice; Tzortzis v. Monarch Line, The Assunzione and Amin Rasheed for implied choice; and NTPC v. Singer Company for the ladder itself and for the exclusion of renvoi in contract.
It does not decide how the proper law is to be found; the definition is a statement of function, and the rest of the module supplies the method.