Rules of Civil Procedure Scenario

Rules of Civil Procedure

SCENARIO

This work is based upon the following commentary between two individuals: (1) the first individual states: 'The Federal Rules of Civil Procedure have been drafted without enough consideration to how substance and procedure co-exist in society'; and (2) the second individual states: 'Substance and procedure are too intermingled in the Federal Rules of Civil Procedure.' This essay will take into account and provide explanations for each individual's perception and then apply thoughtful consideration of where to draw the line between substance and procedure.

The work of Redish and Phillips (1977) entitled: "Erie and the Rules of Decision Act: In Search of the Appropriate Dilemma" holds that the decision in Hanna v. Plumer changed the 'outcome determination test' for the decision that the Rules of Decision Act cases was not responsive to the key policy concerns that underlie Erie Railroad v. Tompkins. Redish and Phillips state a proposal for a balancing test that is designed in such a manner that both state and federal interests are accommodated and in which a proper balance is achieved within the federal system.

II. ERIE CASE WAS REVERSAL of FEDERAL and STATE LAW RELATION

The decision in Erie was representative of a "...dramatic reversal in the relation between the federal courts and state law" (1977) as well as serving to bring about much confusion concerning the doctrines that arose from this case. Through an organizational approach, John Hart Ely disseminated this matter in 1974 in his study which noted the court's acknowledgement stating there are "three distinct and rather ordinary problems of statutory and constitutional interpretation that had been all pushed together under the canopy of the 'Erie doctrine' which are stated to be those as follows:

1) the constitutional limits on Congress' power to prescribe statutory law for suits brought in federal courts under diversity of citizenship;

2) the statutory limits provided in the Rules of Decision Act on the federal courts' power to employ wholly judge-made procedures for diversity suits to the exclusion of applicable state procedures; and 3) the statutory limits specified by Congress in the Rules Enabling Act on the Supreme Court's power to prescribe non-statutory rules for federal courts as it did..." (Redish and Phillips, 1977)

III. CONSTITUTIONAL QUESTION REMAINS

Since Congress cannot exceed the powers that are vested in it through the Constitution, this is a constitutional question that "will remain in the background of every case" however, as determined by Professor Ely "the mere fact that Congress retains constitutional power to authorize the federal courts to develop - within limits- their own legal principles in diversity cases does not mean that Congress has actually exercised that power..." (Redish and Phillips, 1977) in fact, within the scope of the 'Rules Enabling and Rules of Decision Acts' limitations has been imposed by Congress that are much farther reaching and more rigid that those found in the Constitution regarding the authority of a federal court in disregarding state law in diversity cases.

IV. HISTORY of DIVERSITY JURISDICTION

Diversity jurisdiction was historically put into place due to the consideration that the courts in the individual states might be subject to bias in favor of the litigants of that particular state in which the action was brought and that litigants who were not state citizens might not receive treatment that was of a fair nature. Since judges in the state courts are elected officials the consideration was that perhaps judges would give more response to claims made by voters in their respective state and imbalance the judicial process for voters from other states. However, diversity alone has at no time been a basis for federal jurisdiction alone and a dollar minimum has always been applicable prior to a diversity case being brought under the jurisdiction of the federal court. Substantative law or the 'substance' of the law is the "body of basic rights and responsibilities comprising our legal heritage and is comprised of prior court decisions and statues." (Redish and Phillips, 1977)

V. REASON for FEDERAL COURT FOLLOWING of SUBSTANTIVE STATE LAW

The federal court follows substantative law of the state in which it sits on cases in order to protect from results that are different being handed down by a federal court than would be handed down from the state court. When a choice exists between state and federal court in which the action is brought then the outcome of the case should not be controlled by this choice. This doctrine enunciating the law federal courts should follow in diversity cases is traced back to the Erie case and was a decision of Justice Louis D. Brandeis in 1938. Within this framework diversity cases arose for prevention of discrimination against non-citizens of a state and the state law must still be applied to provide for uniformity of justice. Without this there would be endless confusion between adjudications of state and federal courts in cases where no federal statutes are existing. Even after an appeal has been heard on a diversity case the Court of Appeals and the U.S. Supreme Court will adhere to the state laws and case law is the determiner of federal case decisions.

VI. RULES of DECISION ACT

In the case where a federal ruling or standing differs from the laws of the state in which the federal case is being heard and in which the federal court "seeks to apply wholly judge-made rules to the exclusion of state law- in other words, where no Federal Rule or specifically applicable federal statue is involved - the Rules of Decision Act will determine whether the departure from state law is permissible." (Redish and Phillips, 1979)

In the Erie case three distinct interests are recognized by the court:

1) the state's interest in not having its substantive policies undermined in diversity cases, (2) the federal court's interest in administering justice in accord with the dictates of significant federal principles, and 3) the litigant's interest in not having the outcome of the case turns exclusively on the forum in which the case was brought. (Redish and Phillips, 1979)

Redish and Phillips state that the court can be understood in two possible ways:

1) a reading of Byrd appears to require a two-step approach in Rules of Decision Act issues:

a) if the use of the state procedure was 'bound up' with accomplishment of the state substantive policy; and the state procedure had to be followed; and b) balancing federal interests on the one hand and the danger of different outcomes on the other would be relevant however only if as in the Byrd case there was not existing substantive state interest in having the federal court adhere to the state procedure; and 2) a second possible reading is stated to be that "...all three factors are to be balanced simultaneously. Under this approach, the state interest in preserving its substantive policies and the danger of giving rise to different outcomes would both weigh in favor of following the state procedures.

Finally stated to be balanced "against these two elements' is the interest of the federal system in the preservation of its "essential character or function by following federal procedure." (Redish and Phillips, 1979)

VII. ERIC CASE (1938) HAD THREE DIFFERENT LEGAL STANDARDS

Redish and Phillips write that following the Erie case in 1938 three different legal standards for deciding Rules of Decision Act issues have, at various times, commanded a majority of the Supreme Court: the 'outcome determination test announced in Guaranty Trust Co. v. York the balancing test employed in Byrd v. Blue Ridge Rural Electric Cooperative, Inc. And most recently, the modified outcome determination test' articulated in Hanner v. Plumer'." (Redish and Phillips, 1979) in the Hanna case the Court is stated by Redish and Phillips to have "expressly superseded" the outcome in the York determination test and had been eliminated "as a viable standard for Rules of Decision Act cases." (Redish and Phillips, 1979) the relationship is not as clear between the standard and balancing test that the court used in the Hanna and Byrd case. (Redish and Phillips, 1979; paraphrased)