Opinion ID: 2570132
Heading Depth: 4
Heading Rank: 1

Heading: New Mexico Respects Choice-of-Law Provisions Unless Application of the Chosen Law Would Contravene New Mexico Public Policy

Text: {6} The threshold question in determining the validity of the class action ban is which state's law must be applied to this potentially multi-state class action that was filed in New Mexico by a New Mexico resident against a defendant that maintains its principal place of business in Texas for damages relating to a contract that contains a choice-of-law clause directing that Texas law be applied. {7} New Mexico respects party autonomy; the law to be applied to a particular dispute may be chosen by the parties through a contractual choice-of-law provision. Section 55-1-301(A); see also United Wholesale Liquor Co. v. Brown-Forman Distillers Corp., 108 N.M. 467, 470, 775 P.2d 233, 236 (1989). However, when application of the law chosen by the parties offends New Mexico public policy, our courts may decline to enforce the choice-of-law provision and apply New Mexico law instead. United Wholesale Liquor, 108 N.M. at 470, 775 P.2d at 236; Sandoval v. Valdez, 91 N.M. 705, 707, 580 P.2d 131, 133 (Ct.App.1978). New Mexico courts will not give effect to another state's laws where those laws would violate some fundamental principle of justice. Reagan v. McGee Drilling Corp., 1997-NMCA-014, ¶ 9, 123 N.M. 68, 933 P.2d 867 (quoted authority omitted). {8} Application of Texas law to the instant matter would likely require enforcing the class action ban. See AutoNation USA Corp. v. Leroy, 105 S.W.3d 190, 199-201 (Tex.App.2003) (contractual prohibition of class actions not fundamentally unfair or violative of public policy). Unless enforcement of the class action ban would run afoul of fundamental New Mexico public policy, our conflict of law rules counsel respecting the choice-of-law provision and applying Texas law.