Say the ratio out loud before you open Reasoning — recalling it unprompted is exactly what the exam pays for.
Why it matters
It supplies two things: the classical definition of the proper law, and the classical statement of the imputed intention that the Supreme Court of India expressly declined to adopt. It is a short chapter, because what this course gives is the two statements, quoted in Delhi Cloth and General Mills Co. v. Harnam Singh.
Facts
This course quotes the case within Delhi Cloth and does not set out its facts.
Held
On the definition. The proper law is that law which the English or other court is to apply in determining the obligations under the contract.
On the imputed intention. The parties may not have thought of the matter at all; then the court has to impute an intention, or to determine for the parties what is the proper law which, as just and reasonable persons, they ought or would have intended if they had thought about the question when they made the contract.
Reasoning
Step one — note what the definition does not do. It says what the proper law is for — determining the obligations under the contract — and says nothing about where it comes from. The same is true of the formulation in Indian General Investment Trust v. Raja of Kholikote. That vacuum is filled by the ladder of express, implied and imputed choice.
Step two — see the problem the second statement tries to solve. Where the contract is silent, the subjective theory has nothing to work on. The classical answer invents a reasonable intention and attributes it.
Step three — see why Bose J. refused it. In Delhi Cloth he held it unnecessarily artificial to impute an intention when we know there was none, especially in a case where the parties would never have contracted at all had they contemplated the events that occurred; what the courts really do, when there is no express provision, is to apply an objective test, though they appear to regard the intention subjectively. Cheshire agrees, as the judgment notes, that the judges, though emphasising in unrestricted terms the omnipotence of intention, in fact do no more than impute an intention to the parties.
Exam use
It opens: Define the proper law of a contract — give this definition and the one in Indian General Investment Trust, and add Lord Simonds in Bonython: the system of law by reference to which the contract was made, or that with which the transaction has its closest and most real connexion.
Then use the second statement as the pivot of the essay. Set the classical imputed intention against Bose J.'s refusal of the fiction, and close with the verdict this course invites: the subjective theory survives as the language of the cases and the objective theory does the work.
It does not decide the Indian law, which on this point is Delhi Cloth; cite this case for what was rejected.