Say the ratio out loud before you open Reasoning — recalling it unprompted is exactly what the exam pays for.
Why it matters
It is the second application of the putative proper law, and the more striking one, because it shows the device deciding whether there is a contract at all on a point — consideration — where legal systems flatly disagree.
Facts
This course cites the case for the operation of the putative proper law on the requirement of consideration and does not set out its facts.
Held
If the putative proper law is English law, the absence of consideration renders the purported contract void ab initio. If the putative proper law does not require consideration as a necessary element of a valid contract, a valid contract may result.
Reasoning
Step one — the circularity again. Whether a contract exists cannot be decided by its proper law, because if there is no contract there is no proper law. So the court asks which law would govern if the contract were valid.
Step two — apply that law to the constitutive requirement. Consideration is a condition of the existence of a contract in English law and is unknown to many civil law systems. Whichever system the putative proper law turns out to be, its answer is the answer.
Step three — note the asymmetry of outcomes. The device does not favour validity. It produces a void agreement where the putative proper law is English and a good one where it is not, which is precisely why it is a genuine choice-of-law rule and not a presumption in favour of contracts.
Exam use
It opens: Explain the putative proper law with examples — use The Parouth for offer and acceptance and this case for consideration.
State the residual doubt, because the course does. It is uncertain whether the parties can choose a particular legal system as the putative proper law. That uncertainty is the point of the head: a party who wants the agreement to exist would always nominate a system that dispenses with the constitutive requirement, which is the same objection that keeps capacity out of the reach of an express choice.
Connect it to the wider structure of the module. The proper law is not the only law that speaks to a contract. Form escapes it — a contract is formally valid if it satisfies either the formalities of the lex loci contractus or those of the proper law. Illegality escapes it — the lex fori, the lex loci contractus and the lex loci solutionis may all speak. Capacity escapes the parties' choice and is referred to the objectively ascertained proper law. And formation, where the contract's existence is in issue, is referred to the putative proper law.
It does not decide whether the putative proper law may be chosen; the course records the question as open.