CHAPTER 271. RIGHTS OF PARTIES TO CHOOSE LAW APPLICABLE TO CERTAIN TRANSACTIONS

State Codes and Statutes

Statutes > Texas > Business-and-commerce-code > Title-9-applicability-of-law-to-commercial-transactions > Chapter-271-rights-of-parties-to-choose-law-applicable-to-certain-transactions

BUSINESS AND COMMERCE CODE

TITLE 9. APPLICABILITY OF LAW TO COMMERCIAL TRANSACTIONS

CHAPTER 271. RIGHTS OF PARTIES TO CHOOSE LAW APPLICABLE

TO CERTAIN TRANSACTIONS

Sec. 271.001. DEFINITION. In this chapter, "qualified

transaction" means a transaction under which a party:

(1) pays or receives, or is obligated to pay or is entitled to

receive, consideration with an aggregate value of at least $1

million; or

(2) lends, advances, borrows, or receives, or is obligated to

lend or advance or is entitled to borrow or receive, money or

credit with an aggregate value of at least $1 million.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.002. SUBSTANTIALLY SIMILAR OR RELATED TRANSACTIONS.

For purposes of this chapter, two or more substantially similar

or related transactions are considered a single transaction if

the transactions:

(1) are entered into contemporaneously; and

(2) have at least one common party.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.003. CONFLICT-OF-LAWS RULES. For purposes of this

chapter, a reference to the law of a particular jurisdiction does

not include that jurisdiction's conflict-of-laws rules.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.004. DETERMINATION OF REASONABLE RELATION OF

TRANSACTION TO PARTICULAR JURISDICTION. (a) For purposes of

this chapter, a transaction bears a reasonable relation to a

particular jurisdiction if the transaction, the subject matter of

the transaction, or a party to the transaction is reasonably

related to that jurisdiction.

(b) A transaction bears a reasonable relation to a particular

jurisdiction if:

(1) a party to the transaction is a resident of that

jurisdiction;

(2) a party to the transaction has the party's place of business

or, if that party has more than one place of business, the

party's chief executive office or an office from which the party

conducts a substantial part of the negotiations relating to the

transaction, in that jurisdiction;

(3) all or part of the subject matter of the transaction is

located in that jurisdiction;

(4) a party to the transaction is required to perform in that

jurisdiction a substantial part of the party's obligations

relating to the transaction, such as delivering payments; or

(5) a substantial part of the negotiations relating to the

transaction occurred in that jurisdiction and an agreement

relating to the transaction was signed in that jurisdiction by a

party to the transaction.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.005. LAW GOVERNING ISSUE RELATING TO QUALIFIED

TRANSACTION. (a) Except as provided by Section 271.007,

271.008(b), 271.009, 271.010, or 271.011 or by Chapter 272, the

law of a particular jurisdiction governs an issue relating to a

qualified transaction if:

(1) the parties to the transaction agree in writing that the law

of that jurisdiction governs the issue, including the validity or

enforceability of an agreement relating to the transaction or a

provision of the agreement; and

(2) the transaction bears a reasonable relation to that

jurisdiction.

(b) The law of a particular jurisdiction governs an issue

described by this section regardless of whether the application

of that law is contrary to a fundamental or public policy of this

state or of any other jurisdiction.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.006. LAW GOVERNING INTERPRETATION OR CONSTRUCTION OF

AGREEMENT RELATING TO QUALIFIED TRANSACTION. Except as provided

by Section 271.008(b), 271.009, 271.010, or 271.011 and by

Chapter 272, if the parties to a qualified transaction agree in

writing that the law of a particular jurisdiction governs the

interpretation or construction of an agreement relating to the

transaction or a provision of the agreement, the law of that

jurisdiction governs that issue regardless of whether the

transaction bears a reasonable relation to that jurisdiction.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.007. LAW GOVERNING VALIDITY OR ENFORCEABILITY OF TERM

OF AGREEMENT RELATING TO QUALIFIED TRANSACTION. (a) Except as

provided by Section 271.008(b), 271.009, 271.010, or 271.011 or

by Chapter 272, this section applies if:

(1) the parties to a qualified transaction agree in writing that

the law of a particular jurisdiction governs the validity or

enforceability of an agreement relating to the transaction or a

provision of the agreement;

(2) the transaction bears a reasonable relation to that

jurisdiction; and

(3) a term of the agreement or of that provision is invalid or

unenforceable under the law of that jurisdiction but is valid or

enforceable under the law of the jurisdiction that has the most

significant relation to the transaction, the subject matter of

the transaction, and the parties.

(b) If this section applies:

(1) the law of the jurisdiction that has the most significant

relation to the transaction, the subject matter of the

transaction, and the parties governs the validity or

enforceability of a term described by Subsection (a)(3); and

(2) the law of the jurisdiction that the parties agree would

govern the validity or enforceability of the agreement or

provision governs the validity or enforceability of the other

terms of the agreement or provision.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.008. APPLICABILITY TO CERTAIN REAL PROPERTY

TRANSACTIONS; EXCEPTIONS. (a) Sections 271.004-271.007 apply to

the determination of the law that governs an issue relating to a

transaction involving real property other than a matter described

by Subsection (b), including the validity or enforceability of an

indebtedness incurred in consideration for the transfer of, or

the payment of which is secured by a lien on, real property.

(b) Sections 271.004-271.007 do not apply to the determination

of the law that governs:

(1) whether a transaction transfers or creates an interest in

real property for security purposes or otherwise;

(2) the nature of an interest in real property that is

transferred or created by a transaction;

(3) the method for foreclosure of a lien on real property;

(4) the nature of an interest in real property that results from

foreclosure; or

(5) the manner and effect of recording or failing to record

evidence of a transaction that transfers or creates an interest

in real property.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.009. EXCEPTION: MARRIAGE OR ADOPTION. Sections

271.004-271.007 do not apply to the determination of the law that

governs:

(1) the validity of a marriage or an adoption;

(2) whether a marriage has been terminated; or

(3) the effect of a marriage on property owned by a spouse at

the time of the marriage or acquired by either spouse during the

marriage.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.010. EXCEPTION: DECEDENT'S ESTATE. Sections

271.004-271.007 do not apply to the determination of the law that

governs:

(1) whether an instrument is a will;

(2) the rights of persons under a will; or

(3) the rights of persons in the absence of a will.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

Sec. 271.011. EXCEPTION: OTHER STATUTE SPECIFYING GOVERNING

LAW. Sections 271.004-271.007 do not apply to the determination

of the law that governs an issue that another statute of this

state or a statute of the United States provides is governed by

the law of a particular jurisdiction.

Added by Acts 2007, 80th Leg., R.S., Ch.

885, Sec. 2.01, eff. April 1, 2009.

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

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