CONFLICT OF LAWS-STATUTE OF LIMITATIONS-STATE STATUTE BINDING ON FEDERAL COURT IN EQUITY CASE WHEN SOLE GROUND OF JURISDICTION IS DIVERSITY OF CITIZENSHIP

Authors

Samuel D. Estep S.Ed., University of Michigan Law SchoolFollow

Abstract

Defendant trust company was trustee for enforcing the rights of noteholders of the Van Sweringen Corporation. When it became apparent that the Corporation could not meet its obligations, defendant company gave an option to noteholders to sell the notes for 50 per cent cash plus stock in the Van Sweringen Corporation. The donor from whom the plaintiff had received some of these notes as a gift had not accepted the exchange. Plaintiff brings suit for an alleged breach of trust. The circuit court of appeals held, reversing the summary judgment of the district court, "that in a suit brought on the equity side of a federal district court that court is not required to apply the state statute of limitations that would govern like suits in the courts of a state where the federal court is sitting even though the exclusive basis of federal jurisdiction is diversity of citizenship." Reversing the circuit court, the Supreme Court held, the rule of Erie Railroad v. Tompkins is applicable in such cases so the state statute does bind the federal court. Guaranty Trust Co. of N.Y. v. York, (U.S. 1945) 65 S. Ct. 1464,4

Recommended Citation

Samuel D. Estep S.Ed., CONFLICT OF LAWS-STATUTE OF LIMITATIONS-STATE STATUTE BINDING ON FEDERAL COURT IN EQUITY CASE WHEN SOLE GROUND OF JURISDICTION IS DIVERSITY OF CITIZENSHIP, 44 Mich. L. Rev. 477 (1945).
Available at: https://repository.law.umich.edu/mlr/vol44/iss3/8