## Facts

- Leo Walton, an Arkansas citizen temporarily in Saudi Arabia, was seriously injured when his car collided with a truck owned by Arabian American Oil Company and driven by its employee.
- Walton sued Aramco (a Delaware corporation licensed in New York) in the Southern District of New York under diversity jurisdiction, alleging negligence.
- Under New York conflict-of-laws rules, the substantive law governing a tort claim is the law of the place of injury, here Saudi Arabia.
- Neither party pleaded, proved, or offered proof of Saudi tort law.
- Walton intentionally refused to present Saudi law, arguing the court should apply New York negligence law by default, or apply supposed universal “rudimentary” negligence principles.
- Walton also argued the court should disregard Saudi law based on assertions that Saudi Arabia lacked a recognizable legal system for such claims.

## Issues

1. In a New York diversity action for a tort occurring in Saudi Arabia, must the court apply Saudi substantive law under New York choice-of-law rules?
2. When foreign law governs but is neither pleaded nor proved, is the trial court required to take judicial notice of that foreign law on its own initiative?
3. May a plaintiff avoid application of foreign law by unsupported assertions that the foreign sovereign lacks an adequate legal system, permitting application of forum law or universal negligence principles?

## Decision

- The Second Circuit affirmed a directed verdict for Aramco.
- The court held that New York conflicts rules required application of Saudi substantive law because the tort occurred in Saudi Arabia.
- The court held the trial judge was not required to take judicial notice of Saudi law sua sponte where neither party pleaded or proved it.
- The court rejected applying New York law or “rudimentary” negligence principles as a substitute for proof of the governing foreign law.
- The court held allegations that a foreign legal system is inadequate or arbitrary require substantial proof; mere assertions do not justify disregarding foreign law.

## Legal Principles

- In diversity cases, federal courts apply the forum state’s choice-of-law rules; in New York tort cases, the substantive law is generally that of the place of the tort.
- Foreign law is ordinarily treated as a matter to be pleaded and proved by the party who seeks to rely on it; absent proof, a court is not obligated to supply foreign law on its own.
- Judicial notice of foreign law may be discretionary, and refusal is permissible where the foreign system is unfamiliar and the parties provide no adequate materials.
- Courts should not presume universal negligence rules or presume foreign law mirrors forum law without evidentiary support.
- A public-policy claim that a foreign sovereign lacks an adequate legal system must be supported by substantial evidence before a court will refuse to apply the otherwise governing foreign law.

## Conclusion

Because New York choice-of-law rules made Saudi law controlling and Walton deliberately declined to plead or prove Saudi law, the trial court properly refused to take judicial notice of it and properly directed a verdict for the defendant; the judgment was affirmed.


Walton v. Arabian Am. Oil Co., 233 F.2d 541 (2d Cir. 1956)