Also known as: rule of decision · Rules of Decision Act · Erie doctrine · choice of law
Written by attorneys · grounded in primary & secondary sources — see below
A body of substantive legal principles that federal courts apply to decide the merits of civil claims when state law governs the underlying right or obligation. The directive ensures that federal courts respect state-created rights rather than fashioning independent federal rules in areas traditionally reserved to the states.
Rebecca Ross sued Riverstone Manufacturing in federal court under diversity jurisdiction for breach of a state-law supply contract. Riverstone sought to call an elderly employee whose conservatorship order raised competency questions under state law. Because state law supplied the rule of decision for the contract claim, the court applied the state competency standard and excluded the witness.
Renee Rogers, a citizen of State X, sued Rising Sun Electronics in federal court in State Y for breach of a sales agreement. The court first determined that State Y's choice-of-law rules governed which state's substantive contract law applied. Those rules selected State X law, which then supplied the rules of decision on formation and damages.
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Raymond Ramos transferred equipment located in State A to a buyer domiciled in State B. When a dispute arose over title, the federal court evaluated the factors in the Restatement to identify the state with the most significant relationship to the property and parties. That state's local law then supplied the rules of decision on ownership.
Roberto Reyes executed a will in State A while domiciled in State B. After his death, the federal court assessed validity under the Uniform Probate Code choice-of-law provision. Because execution complied with the law of the place of execution, that state's rules supplied the rules of decision and upheld the will.
Ralph Richardson sued Rhapsody Entertainment in federal court for a state-law trade-secret misappropriation claim. When the defendant asserted an attorney-client privilege over internal documents, the court applied state privilege law because state law supplied the rule of decision for the underlying claim.
Ryan Roberts sued Radiance Media in federal court for breach of a commercial lease governed by state law. The landlord introduced a notarized acceptance certificate that raised a state-law presumption shifting the burden of persuasion. Because state law supplied the rule of decision, the court applied the state presumption rather than a federal one.
State law supplies the rule of decision whenever the claim or defense arises under state substantive law, as in diversity cases or when federal law incorporates state standards. Federal courts then treat the state rule as the governing standard for the merits rather than creating an independent federal rule.
Rules 302, 501, and 601 each direct federal courts to apply state law on presumptions, privileges, and witness competency when state law supplies the rule of decision for the claim or defense. This preserves state substantive policy even though the Federal Rules otherwise control procedure.
Yes. A federal court sitting in diversity must apply the choice-of-law rules of the state in which it sits because those rules are treated as substantive for Erie purposes. The selected state's substantive law then supplies the rules of decision on the merits.
Federal Rules of Evidence 302 and 501 expressly require application of state law on the effect of a presumption or the scope of a privilege when state law supplies the rule of decision. The federal court therefore follows the state allocation of burdens or the state privilege even if a different federal approach would otherwise apply.
…except where the Constitution, treaties, or statutes of the United States otherwise require or provide, shall be regarded as rules of decision in trials at common law, in the courts of the United States, in cases where they apply." Because of the importance of the question whether the federal court was free to disregard the…