Guaranty Trust Co. v. York

Summary

A federal court sitting in equity on diversity jurisdiction must apply the forum State's statute of limitations if its plea would bar recovery in a State court, because a federal court adjudicating a State-created right solely on diversity is, in effect, only another court of the State and the outcome should be substantially the same as in a State court. The Court expressly declined to decide whether the New York statute actually bars respondent's breach-of-trust claim, reversing the Second Circuit's contrary holding and remanding. Justice Rutledge, joined by Justice Murphy, dissented, urging remand on the antecedent limitations question and preservation of the traditional remedial treatment of limitations statutes in federal equity.