For the purposes of the lex loci analysis, fraud and negligent misrepresentation occur where the misrepresentation is made, not where the effect is felt. Bailey Employment Systems, Inc. v. Hahn, 655 F.2d 473 (2d Cir. 1981); Commonwealth Fuel Company v. McNeil, 103 Conn. 390, 130 A. 794 (1925). The contract which contained the misrepresentations was made in Connecticut and therefore the misrepresentations were made in Connecticut.
In an action for fraud and deceit, the place of wrong is the place where the loss is sustained. Restatement, Conflict of Laws (1934) § 377, n. pt. 4; 2 Beale, The Conflict of Laws (1935) § 377.2; A.B. v. C.D., D.C.E.D.Pa. 1940, 36 F. Supp. 85, affirmed, 3 Cir., 1941, 123 F.2d 1017; Commonwealth Fuel Co. v. McNeil, 1925, 103 Conn. 390, 404, 130 A. 794, 800; Bradbury v. Central Vermont Ry., 1938, 299 Mass. 230, 233, 12 N.E.2d 732, 734. This point seems not to have been considered in any New Jersey decision, but in view of the position of the courts of that state upon conflict of laws rule in torts cases, we have no reason to doubt that they would follow the rule thus expressed, since it seems to be undisputed. The alleged loss here is the sale of plaintiff's business for an inadequate consideration, settlement for commissions at a sum substantially less than actually due and the damage resulting therefrom.
Klaxon Co. v. Stentor Electric Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477. Connecticut, like the majority of the States, follows the rule that the substantive law of the place of the tort will be applied by its courts, but that in matters of procedure the Connecticut courts will apply Connecticut law. Schaefer v. O.K. Tool Co., Inc., 110 Conn. 528, 535, 148 A. 330; Commonwealth Fuel Co. v. McNeil, 103 Conn. 390, 405, 130 A. 794; and Bohenek v. Niedswiecki, 18 Conn. Sup. 296. In this case the alleged negligent act or omission took place in Connecticut and the fatal injury occurred in Maryland.
A further demurrer was overruled, issues were joined February 4th, 1925, and hearing had resulting in a disagreement of the jury, and on January 25th, 1927, the defendant filed certified copies of a preliminary and final certificate of dissolution of the corporation, together with a motion to erase the case from the docket on the ground that the defendant corporation had been dissolved October 19th, 1923, prior to the institution of the action, which motion was later denied. During the trial of the case, the presiding judge called the attention of counsel to the opinion of this court in the case of Commonwealth Fuel Co. v. McNeil, 103 Conn. 390, 130 A. 794, which was decided after the original demurrer sustained, and suggested that if the plaintiff had a right of action it would rest upon the laws of the State of New York rather than of the State of Connecticut. The plaintiff was thereupon permitted to file a substitute complaint on October 25th, 1927, when the defendant again demurred and was overruled. The defendant then answered the complaint by general denial and setting up as affirmative defenses, that of contributory negligence, the statute of limitations, and the invalidity of the action of the Court of Probate in this State in granting letters of administration on the ground of lack of jurisdiction.
For choice of law purposes under Connecticut law, a tort is committed not where the wrongful act or omission occurs, but where the injury is sustained. Commonwealth Fuel Co. v. McNeil, 103 Conn. 390, 130 A. 794 (1925); Bissonnette v. Bissonnette, supra; Landers v. Landers, 153 Conn. 303, 216 A.2d 183 (1966); Teitelman v. Bloomstein, 155 Conn. 653, 236 A.2d 900 (1967). Indeed, even were Connecticut to reject this rule in favor of a "substantial contacts" analysis on this particular issue, see, e.g., Babcock v. Jackson, 12 N.Y.2d 473, 240 N.Y.S.2d 743, 191 N.E.2d 279 (1963), we reason, as did the district court, that a Connecticut court would still look to New Hampshire law with reference to the permissible limits of recovery, because, as the district court noted, all the substantial contacts — save only the defendant corporation's factory and offices — are found in New Hampshire.
II — The Tort Claim As this cause of action arises under state law, the district court was obliged under the rule of Klaxon Co. v. Stentor Elec. Mfg. Co., 1941, 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477, to apply the law that would have been applied by the Connecticut courts. Under the conflict of laws rules of Connecticut, the substantive law of Wisconsin, the place where the tort occurred, was properly applied, see, e.g., Commonwealth Fuel Co. v. McNeil, 1925, 103 Conn. 390, 130 A. 794, since it was there that the defendant approached Reidl to purchase Crash Book Service, and it was there that the contract of sale was signed. As to the tort claim, three questions are presented. (1) Was there a contract between Reidl and the plaintiff? (2) If a contract existed, was it breached by Reidl's sale of the business including the right to receive renewal commissions upon renewals of prior subscriptions? (3) If a valid contract was breached, was Hearst's conduct in inducing Reidl to sell privileged?
Under Connecticut law a tort is committed where the injury is sustained. Patch v. Stanley Works, 448 F.2d 483, 491 (2d Cir. 1971); Commonwealth Fuel Co. v. McNeil, 103 Conn. 390, 405, 130 A. 794 (1925). After Bailey was decided the Second Circuit adopted a different choice of law test for a Connecticut tort case arising out of an aviation disaster.
Normally, legal consequences of particular conduct are determined by exclusive reference to the law of that jurisdiction where the harm occurred. Commonwealth Fuel Co. v. McNeil, 103 Conn. 390, 405, 130 A. 794 (1925). In familiar cases where the plaintiff's harm and the defendant's act are separated by state lines, the accepted conflict of laws rule gives effect only to compensatory interests in the state where the harm occurs.
erned by state law, the law of the state in which the injury or loss was suffered, and which, hence, created the right, governs the tort, and that, in cases of fraudulent misrepresentation, it is not the law of the state where the misrepresentations were made, but, rather, the law of the state where the misrepresentations were intended to, and did, operate to cause the injury or loss that control the tort, but the parties do not agree upon the state in which the claimed fraudulent conspiracy was intended to, and did, finally operate to cause plaintiff to suffer injury and loss. Electric Theatre Co. v. Twentieth Century Fox Film Corp., D.C.W.D.Mo., 113 F. Supp. 937; Restatement of the Conflict of Law, Section 377, p. 457; 2 Beal, The Conflict of Laws (1935), Section 377.2, p. 1287; Iasigi v. Brown, 17 How. 182, 58 U.S. 23, 15 L.Ed. 208; Smyth Sales v. Petroleum Heat Power Co., 3 Cir., 128 F.2d 697; James-Dickenson Farm Mortgage Co. v. Harry, 273 U.S. 119, 47 S.Ct. 308, 71 L.Ed. 569; Commonwealth Fuel Co. v. McNeil, 103 Conn. 390, 130 A. 794; Bradbury v. Central Vt., 299 Mass. 230, 12 N.E.2d 732; Hughes Provision Co. v. LaMear Poultry Egg Co., Mo.App., 242 S.W.2d 285. It seems plain, as pointed out by defendant, that the claim is that defendant conspired with and bribed trusted officers of plaintiff, Brown and Walters, to breach their fiduciary duties to plaintiff by fraudulently inducing plaintiff's president and Board of Directors, in New York, to accept defendant's offer of $125 per share for stock worth $300 per share, and that whatever misrepresentations were made by Brown to plaintiff's president and its Board of Directors were intended to be, and in fact were, made to them in New York and there operated to fraudulently induce acceptance of defendant's offer to plaintiff's injury, and, likewise, the representations, confirmatory of Brown's earlier representations, made by Walters to plaintiff's president, Perry, in the latter's telephone call from New York to the former at Omaha, Nebraska, are, in law, to be regar
In one of the earliest Connecticut decisions to recognize the lex loci doctrine, this court held: "The right of action for the injury is inseparable from its extent, hence the measure of damages as well as the right of recovery are determined by the place of the injury . . . . Such an obligation, or right of action, as a general rule, becomes vested, and will be enforced here precisely as if the obligation or right of action had accrued or arisen in this jurisdiction." Commonwealth Fuel Co. v. McNeil, 103 Conn. 390, 405-406, 130 A. 794 (1925). The vested rights theory was a guiding principle of the first Restatement of Conflict of Laws.