Contract Clauses
Jump to Section
Governing Law Clause Defined
Governing law clauses, also known as choice of law clauses, are used in contracts and agreements and declare the laws that govern the transaction in case a dispute arises. They are standard clauses found in business contracts and transactions.
Here’s a web page that explains governing law clauses.
Governing Law Clause Explained
Governing law clauses ensures that there’s no confusion regarding the applicability of laws to a contract. The party offering the agreement stands to benefit the most since they can require the contract to recognize their local laws.
Purpose of Governing Law Clause
The purpose of governing law clauses gives a contract certainty regarding the laws applied when a legal issue occurs. If one party lives in another state or country, then the governing law clauses ensure that the parties agree upon which codes apply to the agreement.
Governing Law Clause Examples
Examples of governing law clauses include:
- Example 1. Providing services to a company in another country
- Example 2. Partnering with businesses out of state
- Example 3. Including the governing law clause as a matter of form
Governing Law Clause Samples
Sample 1 – Purchase and Sale Contract
Governing Law and Venue. The laws of the State of North Carolina shall govern the validity, construction, enforcement, and interpretation of this Contract, unless otherwise specified herein except for the conflict of laws provisions thereof. Subject to Section 13.24, all claims, disputes and other matters in question arising out of or relating to this Contract, or the breach thereof, shall be decided by proceedings instituted and litigated in a court of competent jurisdiction in the state in which the Property is situated, and the parties hereto expressly consent to the venue and jurisdiction of such court.
Reference:
Security Exchange Commission - Edgar Database, EX-10.42 2 aipl2landmark_ex10z42.htm EXHIBIT 10.42, Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/711642/000071164209000488/aipl2landmark_ex10z42.htm >.
Sample 2 – Asset Purchase Agreement
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas without regard to applicable principles of conflicts of law. Each of the parties hereto irrevocably consents to the exclusive jurisdiction of any federal or state court located within Austin, Texas, in connection with any matter based upon or arising out of this Agreement or the matters contemplated herein, agrees that process may be served upon them in any manner authorized by the laws of the State of Texas for such persons and waives and covenants not to assert or plead any objection which they might otherwise have to such jurisdiction and such process.
Reference:
Security Exchange Commission - Edgar Database, EX-2.1 2 dex21.htm ASSET PURCHASE AGREEMENT, Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1428669/000119312510013625/dex21.htm >.
Sample 3 – Share Purchase Agreement
Governing Law. This Agreement and all disputes arising out of or in connection with this Agreement shall be governed by, interpreted under, and construed and enforceable in accordance with, the laws of the State of New York, U.S.A., without giving effect to conflict of law principles.
Reference:
Security Exchange Commission - Edgar Database, EX-4.12 3 dex412.htm SHARE PURCHASE AGREEMENT, Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1329394/000119312507148404/dex412.htm >.
Sample 4 – Asset Purchase Agreement
Governing Law. This Agreement and the Ancillary Agreements shall be construed in accordance with and governed by the Law of the State of Delaware, without regard to the conflicts of law rules of such state.
Reference:
Security Exchange Commission - Edgar Database, EX-2.1 2 dex21.htm ASSET PURCHASE AGREEMENT, Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/1080866/000119312508111207/dex21.htm >.
Sample 5 – Asset Purchase Agreement
Governing Law. This Agreement shall be governed by and interpreted in accordance with the laws of Delaware without reference to its principles of conflicts of laws.
Reference:
Security Exchange Commission - Edgar Database, EX-10.1 2 dex101.htm ASSET PURCHASE AGREEMENT, Viewed May 10, 2021, < https://www.sec.gov/Archives/edgar/data/92769/000119312510145775/dex101.htm >.
Common Contracts with Governing Law Clauses
Common contracts with governing law clauses include:
- Arbitration agreements
- Settlement agreements
- Service contracts
- Sales contracts
- Real estate contracts
- Insurance contracts
- Demand letters
- Escalation clauses
Any contract is a good candidate for incorporating governing law clauses.
Governing Law Clause FAQs
Governing law clauses are vital to get right. Learn more by checking out the governing law clause FAQs below:
What happens when there is no governing law clause?
If there is no governing law clause, then the court overseeing your case will decide. Fighting the case in the wrong jurisdiction can result in a breach of contract case in civil court with litigation lawyers.
How do we decide the governing law of the contract?
You determine the governing law of the contract through the civil court system or alternative dispute resolution, such as arbitration, a binding solution, or mediation, a non-binding solution. Early neutral evaluation and negotiation can help avoid potential disputes in the future.
Which law should govern a contract?
The laws that govern your contracts should depend upon your business goals. Contract lawyers can help you decide on and negotiate the correct contract law for your situation.
Here’s an article about choosing your governing law clause.
ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.
Meet some of our Lawyers
Benjamin G.
16+ years of diverse legal experience within the military and substantial military leadership and supervisory experience. Portfolio captures experience in national security law (international law, maritime law, sensitive support, inter-agency agreements, rule of law, etc.), government contracts/procurement, administrative law, Freedom of Information Act (FOIA), fiscal law, labor law, civilian personnel law, harassment and hostile work environment, retaliation and whistleblower protection, medical disability, criminal law, and military law. Significant experience advising general/flag officers and senior executives; powerful oral and written communication skills. Post-military experience includes Landlord Tenant Law, Criminal Law, and Family Law.
"The whole process felt smooth and professional, and he stayed within the agreed budget. I would definitely recommend him."
Edward B.
When the pressure mounts and the outcome matters most, Edward L. Blair IV doesn’t just step up—he dominates. As a formidable Florida-based attorney, Mr. Blair commands every case with the unshakable focus of a warrior and the calculated precision of a master strategist. His expertise in drafting pleadings, motions, and contracts transforms legal writing into a sharp-edged instrument—an arsenal of language wielded with power and purpose. Edward L. Blair IV is not just an attorney—he’s a lionhearted force of advocacy. Every case is a mission, and every client is a cause worth fighting for. His strategic legal insight doesn’t just navigate complexity—it crushes confusion, eliminates doubt, and clears the path to victory. Respected by clients and relentless in pursuit of justice, he approaches each legal battle as a personal crusade. When you choose Blair Legal Solutions LLC, you gain more than representation—you gain a relentless ally. Your battle becomes his, and he won’t rest until the job is done.
"Edward was excellent to work with. He explained everything clearly, delivered the trust package on schedule, and made the entire process smooth and stress‑free. The documents were well‑prepared and exactly what I needed. I truly appreciate his professionalism and care. Definitely a 5‑star experience."
Ricardo A.
Ricardo Aponte Parsi is a real estate and corporate counsel with a 22+-year track record of assessing risk, managing litigation, and building compliance systems to protect organizational interests. Trusted business partner and problem solver, dedicated to delivering exceptional results that advance business objectives through preventive counseling, strategic risk management, and shrewd advocacy. Collaborative team leader and project manager who builds relationships, leads change, and communicates effectively with private and public stakeholders. He obtained a bachelor's degree from Syracuse University (1994) with a major in International Relations and his law degree from the Interamerican University of Puerto Rico School of Law (2000). In May 2014, he completed a Master of Laws from Northwestern University School of Law and a Certificate in Business Administration from IE Business School in Madrid, Spain. In 2018, he completed a second LL.M. at Georgetown University Law School in Securities and Financial Regulation. In 2022, he completed a certification in Privacy Law from Seton Hall University School of Law. He was president of the Board of the Puerto Rico Education Council, the licensing agency for the Commonwealth, and is currently the Chairman of the Board of Trustees of the San Juan Community College. Since November of 2024, he has worked as an attorney-advisor for the United States Air Force Installations, Energy and Environmental Law Division (SAF/GCN) at Lackland Air Force Base, in San Antonio, Texas.SAF/GCN provides legal and policy advice to members of the Secretariat, the Air Staff, and the Space Staff on virtually all matters relating to the Department’s 180 installations, nearly 10 million acres of real estate, Base Realignment, and Closure; annual $7 billion installation and operational energy budgets; annual multibillion-dollar military construction program; $8.3 billion military privatized housing portfolio; programs for environmental planning, compliance, and restoration and natural and cultural resources management; and programs for safety and occupational health. The Division advises the Center of Excellence for Environment, Facilities, and Installations and the Energy, Environmental, and Installations Directorates within the Air Force Civil Engineer Center. Experienced with estate planning, wills, trusts, prenuptial agreements and powers of attorney.
"I had a very positive experience working with Ricardo. He was professional, knowledgeable, and took the time to explain the process and answer my questions throughout the matter. He was also responsive to my comments and made the necessary revisions to ensure the agreement reflected my concerns. I especially appreciated his patience in walking me through the details and making sure I understood the process before moving forward. Overall, I felt well supported and would recommend Ricardo to anyone looking for an attorney who is professional, thorough, and easy to work with."
Tsion L.
Seasoned Fractional COO and Legal Counsel with a proven track record of driving operational excellence and legal compliance in high-growth companies. Skilled in developing and executing strategic plans, optimizing business processes, and managing complex legal matters. Demonstrated ability to draft commercial, partnership, and sponsorship agreements, file trademark applications and manage IP portfolios, support corporate filings and board governance. Industries served: small and medium sized small business, cannabis, hemp, consumer goods, e-commerce, SAAs and health and wellness.
"Great experience, very responsive and professionally handled our needs."
Dan P.
Dan C. Pelletier is a New Jersey real estate attorney with 29 years of legal experience and the founder of Ocean Avenue Land & Legacy, an Asbury Park based real estate and estate planning practice. Dan’s practice focuses on commercial leasing, real estate transactions, property transfers and estate planning. He has substantial experience reviewing, drafting and negotiating commercial leases and other real estate agreements, with commercial leasing experience extending back through his work with Riley Riper Hollin & Colagreco and subsequent real estate and investment work. Throughout his career, Dan has worked on real estate from several perspectives—as outside counsel, transactional attorney and asset manager. That background allows him to approach a lease or transaction not simply as a document to be marked up, but as a business arrangement requiring a practical assessment of risk, economics and the parties’ respective obligations. For commercial lease clients, Dan focuses on identifying the provisions that materially matter: rent and additional rent obligations, operating expenses and CAM charges, repair and maintenance responsibilities, insurance and indemnification, permitted use, assignment and subletting, options, guarantees, default remedies, casualty, condemnation and termination rights. His broader real estate practice includes purchase and sale agreements, deeds and property transfers, ownership and entity issues, and related contract matters. Dan also assists New Jersey clients with straightforward estate and legacy planning, including wills, powers of attorney, healthcare directives, revocable trusts and planning involving real property. Dan founded Ocean Avenue Land & Legacy to provide experienced legal counsel in a practical, accessible manner. His approach is direct: understand the client’s objective, identify the meaningful risks, explain them clearly and develop a workable path forward.
"Very knowledgeable and helpful. We would work with him again ."
December 21, 2024
Feras M.
Feras Mousilli is a globally recognized leader in intellectual property, entrepreneurship, and corporate strategy. As the founder and managing partner of Lloyd & Mousilli, he has driven scalable growth strategies for Fortune 500 companies as well as innovative startups in emerging markets.
Find the best lawyer for your project
Browse Lawyers Now
Quick, user friendly and one of the better ways I've come across to get ahold of lawyers willing to take new clients.
View Trustpilot ReviewCONTRACT lawyers by city
- Atlanta Contract Lawyers
- Austin Contract Lawyers
- Boston Contract Lawyers
- Chicago Contract Lawyers
- Dallas Contract Lawyers
- Denver Contract Lawyers
- Fort Lauderdale Contract Lawyers
- Houston Contract Lawyers
- Las Vegas Contract Lawyers
- Los Angeles Contract Lawyers
Contracts Counsel was incredibly helpful and easy to use. I submitted a project for a lawyer's help within a day I had received over 6 proposals from qualified lawyers. I submitted a bid that works best for my business and we went forward with the project.
View Trustpilot Review
I never knew how difficult it was to obtain representation or a lawyer, and ContractsCounsel was EXACTLY the type of service I was hoping for when I was in a pinch. Working with their service was efficient, effective and made me feel in control. Thank you so much and should I ever need attorney services down the road, I'll certainly be a repeat customer.
View Trustpilot Review
I got 5 bids within 24h of posting my project. I choose the person who provided the most detailed and relevant intro letter, highlighting their experience relevant to my project. I am very satisfied with the outcome and quality of the two agreements that were produced, they actually far exceed my expectations.
View Trustpilot Review