In disputes which cross borders, a conflict often arises as to which law applies; the law of the place where the dispute or contract arose; the law of the defendant's domicile; or the law in respect to the location of the item in dispute (lex situs).
As to procedure, the applicable law will be the law of the court (lex fori). But as to substantive law, the law used to resolve the dispute, international law has developed a system for prioritizing which law applies in given situations.
In the result, the law which does apply, once those conflicts of law or choice of law rules have been applied, is known as the lex causae; the law of the cause, and which will govern as to the resolution of the dispute.
In Dicey and Morris on the Conflict of Laws, the authors wrote:
"Lex causae is a convenient shorthand expression denoting the law (usually but not necessarily foreign) which governs the question. It is used in contradistinction to the lex fori, which always means the domestic law of the forum."
REFERENCES:
- Collins, L., Dicey and Morris on The Conflict of Laws (London: Sweet & Maxwell, 2000), page 29
- Duhaime, Lloyd, International Law
- Duhaime, Lloyd, International Law Dictionary
- Duhaime, Lloyd, Latin Law Dictionary