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Detecting Conflicts in Legal Systems

This paper presents a formal and computational framework for detecting conflicts in legal systems, particularly when individuals or companies operate across different jurisdictions. It emphasizes the importance of understanding how specific actions may be interpreted differently under varying legal systems, using a case study involving a British software provider and an Italian purchaser drafting a contract. The methodology allows for the identification of significant legal discrepancies, such as the treatment of liquidated damages, which can impact contractual obligations and outcomes.

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Detecting Conflicts in Legal Systems

This paper presents a formal and computational framework for detecting conflicts in legal systems, particularly when individuals or companies operate across different jurisdictions. It emphasizes the importance of understanding how specific actions may be interpreted differently under varying legal systems, using a case study involving a British software provider and an Italian purchaser drafting a contract. The methodology allows for the identification of significant legal discrepancies, such as the treatment of liquidated damages, which can impact contractual obligations and outcomes.

Uploaded by

Deyvid
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Detecting Conflicts in Legal Systems

Tingting Li1 , Tina Balke2,1 , Marina De Vos1 , Ken Satoh3 , and Julian Padget1
1
University of Bath, Dept. of Computer Science, UK
{t.li,mdv,jap}@cs.bath.ac.uk
2
University of Surrey, Centre for Research in Social Simulation, UK
[email protected]
3
National Institute of Informatics, Principles of Informatics Res. Division, Japan
[email protected]

Abstract. When acting in different jurisdictions (e.g. under the laws of different
countries) at the same time, it can be of great value for individuals to be able to
determine whether disparities among the laws of these different systems exist and
allowing them to identify the consequences that may follow from these dispari-
ties. For individuals, it is typically not of interest to find all the ways in which
these legal systems differ, but rather to establish whether a particular course of
action may have different legal interpretations, depending on the jurisdiction. In
this paper we present a formal and computational framework that, given specific
scenarios (descriptions of courses of action), can automatically detect whether
these scenarios could lead to different outcomes. We demonstrate our approach
by means of a private international law case-study where a company drafts a con-
tract clause after examining the consequences in the available jurisdictions.

1 Introduction

An individual or company may be used to doing business in a particular way in the


jurisdiction(s) with which they are familiar. Unfortunately, the same modus operandi
may not be interpreted in the same way under the laws of another country and there
may be different requirements, sequences of actions, additional actions, unnecessary
actions and caveats, compared to their usual behaviour, when engaging in an activity
that is partly covered by one jurisdiction and partly by another, or even several others.
This “conflict of laws” [14] is an established area of legal research and provides the
motivation for the identification of the legal consequences of differences in the legal
interpretation of actions in different jurisdictions, in order to be able to take account of
them a priori. It is not the paper’s intention to be able to find all the disparities or poten-
tial conflicts between the given systems, although theory and computational methods
do allow for it. Rather, our aim is to demonstrate a mechanism that might be used to
determine: (i) whether a particular behaviour on their part could be legally interpreted
differently in the pertinent jurisdictions, and (ii) could thus lead to a different, possibly
detrimental, possibly beneficial, outcome.
To illustrate our methodology we take a real-world case study described in [6]. The
case study focuses on two companies, a British software provider and an Italian soft-
ware purchaser, that wish to conclude a contract about the purchase of some software.

Y. Motomura, A. Butler, and D. Bekki (Eds.): JSAI-isAI 2012, LNAI 7856, pp. 174–189, 2013.
c Springer-Verlag Berlin Heidelberg 2013
Detecting Conflicts in Legal Systems 175

Whereas the focus in [6] is on examples of conflicting laws, our objective here is to
show how our methodology can encode aspects of those laws and thereby enable the
detection of the existence of those conflicts.
The case study starts when the companies in question are at the stage of drafting the
contract and want to include a liquidated-damage-clause specifying the compensations
to be paid in case of insufficient performance with respect to the terms of the contract.
When drafting such a clause, it is important for the companies to be able to determine
that the clause has the desired effect and is not affected by differences in law that might
result in unexpected changes in the handling of the clause. By using our mechanism to
analyse a formal representation of the legal text on liquidated damages in both countries,
the companies could detect that these clauses differ significantly on one point: namely,
according to Art. 1384 of the Italian Civil Code, the liquidated-damages penalty can be
diminished equitably by a judge, if the principal obligation was executed in part or if the
amount of the penalty was apparently excessive, taking into account the performance
of the contractors in respect of the contract. This clause has no counterpart in British
Law; an important point of variance between the two legal systems, which could result
in significant differences in the liquidated-damage demands. This might be of interest
to the two companies in drafting their contract. They might want to address this issue
by for example by specifying a jurisdiction for handling claims.
In this paper, we present a formal framework and a computational procedure that,
given specific scenarios (descriptions of courses of action) can automatically detect
whether these scenarios could be affected by differences between legal systems, thus
enabling individuals consequently to account for these cases. Throughout the paper, we
use the term conflict informally to denote a difference between the legal interpretation
in one system and another. The formal notion of conflict is manifested by the presence
of a fluent in one system when it is not present in another: this is explained in greater
detail shortly. We use the term jurisdiction to refer the extent or range of some judicial or
administrative power and legal system to refer to the set of laws and processes that apply
in some jurisdiction. We use the term legal framework to refer to our computational
model of some part of such a legal system.
The remainder of the paper is structured as follows: based on ideas presented in
previous works of the authors [4], we start by outlining our view of legal frameworks
and the corresponding computational model of a single legal framework (Section 2).
These ideas are then used to capture comparative legal frameworks in Section 3. Con-
sequently, in Sections 3.3 and 3.4 we focus on the detection of conflicts between the law
of comparative legal frameworks. We use the private international law case-study out-
lined above to demonstrate our approach. Our approach however is applicable to finding
conflicts between laws in general, not just in the specific case study described. The paper
ends with a short summary, conclusions and an outline of future work
(Section 5).

2 Legal Frameworks
A Formal Model for Legal Frameworks For modelling legal frameworks we use the
InstAL language and its tools [2]. The purpose of the model is to formalize the

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