Guaranty Trust Co. v. York
Case Date: 07/22/2024
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Guaranty Trust Co. v. York, 326 U.S. 99 (1945), was a United States Supreme Court case that described how federal courts were to follow state law. Justice Frankfurter delivered the majority opinion further refining the doctrine set forth in Erie Railroad Co. v. Tompkins.
In the current case the defendant argued that the plaintiff's action was time-barred under a New York statute of limitations. The plaintiff countered that the relevant statute of limitations was "procedural," was not "substantive" law, and therefore was not within the ambit of the doctrine established in the Erie case. The court dispensed with this substantive/procedural distinction and stated that regardless of whether the case was argued in state or federal court, the outcome should be substantially the same. Thus, the court set forth an "outcome determinative test" for deciding whether a piece of state law must be obeyed in federal courts—if the outcome is substantively the same then the federal court can apply its own rules instead of state rules. The court held in this case that the New York Statute of limitations be obeyed and the case was reversed and remanded.
This rule was refined first in Byrd v. Blue Ridge Rural Electric Cooperative, Inc. and subsequently defined more specifically in a related series of cases over the next few decades.
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