New York, in its role as a global epicenter of intersecting geopolitical influences, including finance and mercantilism, has suitably evolved, over two centuries, a firmly stable common law, which offers certainty and predictability, complemented by legislative enactments, regarding contract doctrine, thereby making New York a desirable forum for contract dispute resolution. The magnitude of this state’s participation in fashioning law and resolving disputes on the world stage of finance and commerce was captured by the First Department, in Hyundai Corp. v. Republic of Iraq, 20 AD 3d 56, 68 (1st Dept. 2005): “New York City serves as a mecca of international commerce in this global economy, with foreign sovereigns frequently acting as direct parties to that commerce. Indeed, our state court system has created commercial courts to knowledgeably handle specialized commercial litigation, including that which involves foreign sovereigns.” Also see, IRB-Brasil Resseguros, S.A. v. Inepar Investments, S.A., 20 NY 3d 310 (2012), regarding General Obligations Law § 5-1401.
While most commercial actions heard by courts or arbitrators sitting in New York have their geneses in transactions where all the underlying events arose in New York, raising no challenges to personal jurisdiction, other actions are instituted here because of New York’s significant nexus to the events and issues, known as the center of gravity. Still others have their origins in choice of law clauses; many international and interstate corporations and enterprises, as well as wealthy sophisticated businessmen, negotiate to include choice of law provisions designating New York law as the backdrop against which any legal contests will be determined, whether in courts sitting in New York (federal courts being required to apply the substantive law of the jurisdiction in which they sit) or in arbitration.
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