I was thinking about the future issue whereby a ledger may be physically domiciled in/on hardware in one/several sovereign location(s), while the interacting Parties to the Ledger could be all over the Planet, even off Planet.
How does the prime/key Party to a DLT manage the potential contractual conflicts or different principles at law? Or are the DLT & associated Smart Contracts predetermined to use, for example, US Civil Case Law?
Regards, QA.
Note that I’m not a legal expert by any means so this is definitely not legal advice. This is entirely my personal opinion and take on the relationship between systems like Daml and legal contracts / jurisdiction.
I believe that technology like Daml changes nothing about about how contracts interact with law. I don’t even subscribe to the “code as law” philosophy.
Daml is first and foremost a technology that allows you to build software systems that span organisational and other (like jurisdictional or regulatory) boundaries. It doesn’t replace the organisational structures, the laws or regulations, it merely allows you to keep data synchronised between them in real time.
Legal contracts start mattering if there is a dispute. Having guaranteed consistent data already helps with reducing the number of disputes, but there’s always potential for human error or indeed malicious behaviour. If you get to the point where you have a legal contract between two parties in two jurisdictions, and a dispute needs to be resolved in the courts, the legal contracts and systems you used to conduct business help the courts make their ruling, but they are ultimately completely open to interpretation by the courts.
So the best you can do is to work with legal experts to establish that the contracts you have put in place and the software system you have built are likely to be interpreted the way you intended by the courts. Ie you have to establish before the fact that the ledger is probably going to be considered the legally binding “books and records” by all involved courts. And that has been Digital Asset’s approach. See for example the work on “Committed Settlement”, in which legal experts come to the conclusion that a Daml ledger can form the legal basis for asset settlement.
My take is that if you want to do cross-border business, you need to analyse the situation for every jurisdiction involved.
Thank you for that comprehensive and considered reply, much appreciated. I will read through those two information sources and if I have any issues, will raise them here.
Again, thank you.