Comparative Impairment

Comparative impairment is a slight modification to the end of the governmental interest analysis approach. As a reminder, the governmental interest analysis follows:

  1. Determine the interests of the states and determine whether there is an apparent, true, or false conflict.
  2. If the conflict is true, reevaluate the interests to see if it leads to a false conflict.
  3. [Comparative Impairment Modification] Determine which interest would be most severely harmed if the law of the other state was applied.

Step three used to be “if the conflict persists apply the forum law.” Note that the modification is not a weighing of the interests, but instead weighing the harm caused by using one interest over an other. Essentially, the modification hopes to be result based, rather than policy based.

Bernhard v. Harrah’s Club

546 P.2d 719 (Cal. 1976).


Whether California law (imposing civil liability on tavern owners for negligently intoxicating patrons) or Nevada law (no civil liability) applies.


Follow the standard interest analysis except the modification comes when evaluating any other potential interests (step 2 above is replaced by step 3).


California law applies.


Plaintiff: Is domiciled in California, was injured in California, and selected California to be the forum.

Defendant: Is domiciled in Nevada and served the alcohol in Nevada.

The defendant is a bar and casino in Nevada that advertised along the highways in California. Seeing these advertisements, a few individuals traveled from California to Nevada and there was served alcohol by the defendant to the point of intoxication and beyond. Despite the intoxication level, the patrons began to drive back home to California where they were involved in an accident, severely injuring the plaintiff.


This case presents a true conflict. California law has an interest in protecting California residents from unsafe driving conditions created here. Nevada law has an interest in protecting defendant taverns from civil liability and endless lawsuits. Because California is protecting the resident plaintiff and Nevada is protecting the resident defendant, there is a true conflict.

Upon reevaluation, the court determines that California policy would most be harmed if Nevada law was imposed instead. Additionally, Nevada law would be minimally harmed if California law was applied because Nevada already imposes criminal liability for negligently serving alcohol and the defendants were advertising to California residents.

Additional Notes

Under the first restatement, this case would be resolved under California law (place where the injury occurred).

With interest analysis, this case would be resolved under California law (true conflict and the tie breaker is the forum state).

Here, the court is using comparative impairment. Using the analysis, this case would be resolved under California law (application of Nevada law would harm California policies more than the harm caused if California applied its law).

California is one of the only states that uses comparative impairment and there are some significant disadvantages. First, all of the Nevada policy interests are negated, giving the plaintiff an additional opportunity for recovery.

Kearney v. Salomon Smith Barney, Inc.

137 P.2d 914 (Cal. 2006).


Whether California law (requiring all parties involved in a call to be informed that the call is being recorded) or Georgia (allowing for only one party to be informed that the call is recorded) applies.


California law applies


The plaintiffs are suing as a class against Salomon Smith Barney (SSB) saying their privacy was violated when called were recorded without their consent.


Interest: California has an interest in protecting consumers privacy while Georgia has an interest in protecting companies’ who rely on the protections of Georgia law.

Comparative impairment: California would be much more harmed applying Georgia’s laws because it would undermine the policy interest of protecting consumers because the law was current and enforced routinely. Conversely, Georgia is not undermined because application of California law is still within compliance of Georgia law.

The “Better Rule”

This rule is more of a methodology (here are what the courts are doing). Essentially, it’s an honest evaluation of what the courts are considering. There are five factors being utilized:

  • Predictability of —uniformity of what laws are going to apply.
  • Maintenance of Interstate and International Order—minimum interference of claims with foreign states.
  • Simplification of the Judicial Task—how complicated would it be for the court to apply the law.
  • Advancement of the Forum’s Governmental Interests—even though the law could apply, does the other state have a legitimate interest in applying their law.
  • Application of the Better Rule of Law

Milkovich v. Saari

203 N.W.2d 408 (1973).


Whether Minnesota (no guest statute) or Ontario (guest statute if there is gross negligence) law applies.


Ontario parties traveled to Minnesota where they were involved in a car accident. The wife ended up in the hospital for a month before returning to Ontario.


Interests: Minnesota is hoping to compensate the injured party while Ontario is hoping to protect the driver and insurance from liability.

  • Predictability of Results—in an unintentional tort context, there is no need for predictability because there is no expectation of forum.
  • Maintenance of Interstate and International Order—each state has a connection to the case, so it could be covered under Minnesota law.
  • Simplification of the Judicial Task—either applying simple negligence or gross negligence is easy to apply.
  • Advancement of the Forum’s Governmental Interests—Minnesota does have a legitimate concern, stop collusion by parties of coming into Minnesota and getting into an accident to sue insurance companies.
  • Application of the Better Rule of Law—Minnesota has a much better rule of law. It is better to have liability so the person can recover than not.

The dissent argues the court should not be deciding which law is “better.”

Additional Notes

First restatement: Where the accident occurred (Minnesota)

Interest Analysis: Loss-allocating with a common domicile (Ontario)

Governmental Interest Analysis: False conflict – apply the law where the interest is located (Ontario)

Comparative impairment: Which state would suffer the most harm? (Points to Ontario)

Groupings of Contacts: Where are the most contacts? (Ontario)

Better law: Five factors (point to Ontario)


The content contained in this article may contain inaccuracies and is not intended to reflect the opinions, views, beliefs, or practices of any academic professor or publication. Instead, this content is a reflection on the author’s understanding of the law and legal practices.

Will Laursen

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