Especially in permissionless dApp networks, parties might enter into agreements without specifying the substantive law that should control the resolution of their disputes. Someone residing in France might transact with one living in Ukraine, for instance, without specifying the choice of law. If they fell into dispute, it would not be clear whether the laws of France, Ukraine, or some other jurisdiction should apply. Resolving that uncertainty might prove very costly. A network thus might want to specify a default choice of law, so that disputing parties can at least argue on common ground.
For a network to choose the law of a particular country as its default would risk treating some parties better than others, however. It would also tie the network to the preferences (or whims, as the case may be) of a particular sovereign, which might not care about or even like the network borrowing its laws.
And, yet, a network cannot very well create its own body of law from scratch. Users will want a body of law that they can trust because it comes from time-tested precedents and has benefitted by long scrutiny by by judges, lawyers, and scholars.
Check out Ulex, the open source legal system. It combines comprehensive set of rules from the most respected flag-free sources in an organized framework. If parties running Ulex had an contract claim, for instance, the American Law Institute’s “Restatement” of the common law of contracts would by default govern their dispute.