Erie Doctrine Flashcards
when does the Erie doctrine come up?
It comes up only if we are in federal court and almost always in if we are in federal court under diversity of citizenship jurisdiction. When there is a particular issue, the court must decide in the ERIE question is:
“in deciding that issue, must the federal judge apply state law, or is the federal judge free to ignore state law?”
General rule of ED in diversity cases? mention case.
Rule: In diversity cases, a federal court must apply state substantive law. If the issue is substantive, then the court must use state law (Erie Railroad v. Tompkins).
Provide the reasons behind the general rule for Erie Doctrine.
- Rules of Decision Act – § 1652:
The statute requires that the federal courts apply state law in all cases except where there is an applicable federal law, Constitutional provision or treaty that speaks to the same issue. - Constitution – 10th Amendment:
The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.
Describe Hanna I approach and mention the case relating to this approach.
Is there a VALID FEDERAL PROVISION (on point) that directly conflicts with state law? If YES, then apply federal law. If NO, then proceed with HANNA II approach.
Where can a federal provision be found and when is it valid?
A federal provision can be in the Constitution (automatically valid), in federal statutes and/or in the federal rules of civil procedure. If the federal provision is in the FRCP, to determine if it is valid, we have to look at the RULES ENABLING ACT, section 2071. It is considered valid, if they do not modify substantive rights and it is arguably procedural.
Explain the Hanna II approach.
It comes up when there is NO FEDERAL PROVISION on point. In this case, the federal judge must apply state law on matters of substance BUT if it is a matter of procedure, the federal judge may ignore state law.
What are the tests used by the Supreme Court to determine substantive or procedural for Erie purposes?
- Outcome determinative
- Balance of interests
- Twins aims of the Erie Rule
Describe the Outcome determinative Test
An issue is substantive if it substantially affects the outcome of the case. In the sense that if we use the sate law, in the Hanna case, it will result in immediate victory. If we use federal law, the litigation will continue.
Balance of Interest Test
The court weighs whether the state or federal judicial system has the greater interest in having its rule applied.
Twins Aims of the Erie Rule
to avoid forum shopping and avoid the inequitable administration of law.
When the case it’s been filed, we ask this: if the federal judge ignores the state law, will it cause the parties to flock to federal court? If yes, we do not want that because we do not want to facilitate forum shopping because it’s unfair to in-state citizens because in-state citizens cannot invoke diversity jurisdiction and thus cannot get to federal court to avoid that state law.
HORIZONTAL CHOICE OF LAW
o Substance:
First. To determine which state’s substantive common law would apply, in a diversity case, the federal court must first apply the law that would be applied by the courts of the state in which the federal court is located (Klaxon 1941). This includes the state’s choice of law rules. This might point to the law of that state or of another state.
Second. Use state law. If the applicable substantive law is common law, then use the common law enunciated by the highest court of the relevant state.
HORIZONTAL CHOICE OF LAW
o Substance:
First. To determine which state’s substantive common law would apply, in a diversity case, the federal court must first apply the law that would be applied by the courts of the state in which the federal court is located (Klaxon 1941). This includes the state’s choice of law rules. This might point to the law of that state or of another state.
Second. Use state law. If the applicable substantive law is common law, then use the common law enunciated by the highest court of the relevant state.
