*69•Mr. Justice Brandéis

delivered the opinion of the Court.

The question for decision is whether the oft-challenged doctrine of Swift v. Tyson1 shall now be disapproved.

Tompkins, a citizen of Pennsylvania, was injured on a dark night by a passing freight train of the Erie Railroad Company while walking along its right of way at Hughestown in that State. He claimed that the,accident occurred through negligence in the operation, or maintenance, of the train; that h.e was rightfully on the premises as licensee because on a commonly used beaten: footpath which rah for a short distance alongside the tracks; and that he was struck by something which looked like a door projecting from one of the moving cars. To enforce that claim he brought an action in the federal court for southern New York, which had jurisdiction because the company is a corporation of that State. It denied liability; and the case was tried by a jury.

*70The Erie insisted that its duty to Tompkins was no greater than that , owed to a trespasser. It contended, among other things, that its duty to Tompkins, and hence its liability, should be determined in accordance with the Pennsylvania law;,that under the law of Pennsylvania, as declared by its highest' court, persons who use pathways along the railroad right of way — that is a longitudinal pathway as distinguished from a crossing — are to be deemed trespassers; and that the railroad is not liable for injuries to undiscovered trespassers resulting from its negligence, unless it be wanton or wilful. Tompkins denied that any such rule had been established by the decisions of the Pennsylvania courts; and contended that, since there was no statute of the State on the subject, the railroad’s duty and liability is to be determined in federal courts as a matter of general law.

.. The trial judge refused to rule that the applicable law precluded recovery. The jury brought in a verdict of $30,000; and the judgment entered thereon was affirmed by the Circuit Court of Appeals, which held, 90 F. 2d 603, 604, that it was unnecessary to consider whether the law of Pennsylvania was. as contended, because the question was one not of local, but of general, law and that “upon questions of general law the federal courts are free, in the absence of a local statute, to exercise their independent judgment as to what the law is; and it is well settled that the question of the responsibility of a railroad for injuries caused by its servants is one of general law. . . . Where the public has made open and notorious use of a railroad right of way for a long period of time and without objection, the company owes to persons on such permissive pathway a duty of care in the operation of its trains. ... It is likewise generally recognized law that a jury may find that negligence exists toward a pedestrian using a permissive path on the railroad right of way if he is hit by some object projecting from the side of the train.”

*71The Erie had contended that application of the Pennsylvania rule was required, among other things, by § 34 of the Federal Judiciary Act of September 24, 1789, c. 20, 28 U. S. C. § 725, which provides:

“The laws of the several States, 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 alleged rule of the Pennsylvania common law, we granted certiorari.

First. Swift v. Tyson, 16 Pet. 1, 18, held that federal courts exercising jurisdiction on the ground of diversity of citizenship need not, in matters of general jurisprudence, apply the unwritten law of the State as declared by .its highest court; that they are free to exercise an independent judgment as to what the common law of the State is — or should be; and that, as there stated by Mr. Justice Story:

“the true interpretation of the thirty-fourth section limited its application to state laws strictly local, that is to say, to the positive statutes of the state, and the construction thereof adopted by the local tribunals, and to rights and titles to things having a permanent locality, such as the rights and titles to real estate, and other matters immovable and intraterritorial in their nature and character. It never has been supposed by us, that the section did apply, or was intended to apply, to questions of a more general nature, not at all dependent upon local statutes or local usages of a fixed and permanent operation, as, for example, to the construction of ordinary contracts or other written instruments, and especially to questions of general commerbial law, where the state tribunals are called upon to perform the like functions as ourselves, that is, to' ascertain upon general reasoning and legal analogies, what is the true exposition of the contract or *72instrument, or what is the just rule furnished by the principles of commercial law to govern the case.”

The Court in applying the rule of § 34 to equity cases, in Mason v. United States, 260 U. S. 545, 559, said: “The statute, however, is merely declarative of the rule which would exist in the absence of the statute.” 2 The federal courts assumed, in' the broad field of “general law,” the power to declare rules of decision which Congress was confessedly without power to enact as statutes. Doubt was repeatedly expressed as'to the correctness of the construction given § 34,3 and as to the soundness of the rule which it introduced.4 But it was the more recent research of a competent scholar, who . examined the original document, which established that the construction given to it by the Court was erroneous; and that the purpose of the section was merely to make certain that, in all matters except those in which some federal law is controlling, *73the federal courts exercising jurisdiction in diversity of citizenship cases would apply as their rules of decision the law of the State, unwritten as well as written.5

Criticism of the doctrine became widespread after the decision of Black & White Taxicab Co. v. Brown & Yellow Taxicab Co., 276 U. S. 518.6 There, Brown and Yellow, a Kentucky corporation owned by Kentuckians, and the Louisville and Nashville Railroad, also a Kentucky corporation, wished that the former should have the exclusive privilege of soliciting passenger and baggage transportation at the Bowling Green, Kentucky, railroad station; and that the Black and White, a competing Kentucky corporation, should be prevented from interfering with that privilege. Knowing that such a contract would be void under the common law of Kentucky, it was arranged that the Brown and Yellow reincorporate under the law of Tennessee, and that the contract with the railroad should be executed there. The suit was then brought by the Tennessee corporation in the federal court for western Kentucky to enjoin competition by the Black and White; an injunction issued by the District Court *74waa sustained lay the Court of Appeals; and this Court, citing many decisions in which the doctrine of Swift v. Tyson had been applied, affirmed the decree.

Second. Experience in applying the doctrine of Swift v. Tyson, had revealed its defects, political and social; and the benefits expected to flow from the rule did not accrue. Persistence of state courts in their own opinions on questions of common law prevented uniformity;7 and the . impossibility of discovering a satisfactory line of demarcation between the province of general law and that of local law developed a new well of uncertainties.8

On the other, hand, the mischievous results of the doctrine had becoihe apparent: Diversity of citizenship jurisdiction was conferred in order to prevent apprehended discrimination in state courts against those not citizens of the State. Swift v. Tyson introduced grave discrimination ’by non-citizens against citizens. It made rights enjoyed under the unwritten “general law” vary according to whether enforcement was sought in the state *75or in the federal court; and the privilege of selecting the court in which the right should be determined was conferred upon the non-citizen.9 Thus, the doctrine rendered impossible equal protection of the law. In attempting to promote uniformity of law throughout the United States^ the doctrine had prevented uniformity in the administration of the law of the State.

The discrimination resulting became in practice far-reaching. This resulted in part from the broad province accorded to the so-called “general law” as to which federal courts exercised an independent judgment.10 In addition to questions of purely commercial law, “general law” was held to include the obligations under'contracts entered into and to be performed within the State,11 the extent to which a carrier operating within a State may stipulate for exemption from liability for his own negligence -or that of his employee;12 the liability for torts committed within the State upon persons resident or property located there, even where the question of liar *76bility depended upon the scope of a property right conferred by the State;13 and the right to exemplary or punitive damages.14 Furthermore, state decisions construing local deeds,15 mineral conveyances,16 and even devises of real estate17 were disregarded.18

In part the discrimination resulted from the wide range of persons held entitled to avail themselves of the federal rule by resort to the diversity of citizenship jurisdiction. Through this jurisdiction individual citizens willing to remove from their own State and' become citizens of another might avail themselves of the federal rule.19 And, without even change of residence, a corporate citizen of *77the State could avail itself of the federal rule by re-incorporating under the laws of another State, as was done in the Taxicab case.

The injustice and confusion incident to the doctrine of Swift v. Tyson have been repeatedly urged as reasons for abolishing or limiting diversity of citizenship jurisdiction.20 Other legislative relief has been proposed.21 If only a question of statutory construction were involved, we should not be prepared to abandon a doctrine so widely applied throughout nearly a century.22 But the uncon*78stitutionality of the course pursued has now been made clear and compels us to do so.

Third. Except in matters governed by the Federal Constitution or by Acts of Congress, the law to be applied in any case is the law of the State. And whether the law of the State shall be declared by its Legislature in a statute or by its highest court in a decision is not a matter of federal concern. There is no federal general common law. Congress has no power to declare substantive rules of common law applicable in a State whether they be local in their nature or “general,” be they commercial law or a part of the law of torts. And no clause-in the Constitution purports to confer such a power upon the federal courts. As stated by Mr. Justice Field when protesting in Baltimore & Ohio R. Co. v. Baugh, 149 U. S. 368, 401, against ignoring the Ohio common law of fellow servant liability:

“I am aware that what has been termed the general law of the country — which is often little less than what the judge advancing the doctrine thinks at the time should be the general law on a particular subject — has been often advanced in judicial opinions of this court to control a . conflicting law of a State., I admit that learned judges have fallen into the habit1 of-repeating this doctrine as a convenient mode of brushing aside the law of a State in conflict with their views. And I confess that, moved and governed by the authority of the great names of those judges, I have, myself, in many instances, unhesitatingly and confidently, but I think now-erroneously, repeated the same doctrine. But, notwithstanding the great names which may be cited in favor of the doctrine, and notwithstanding the frequency with which the doctrine has been reiterated, there stands, as a perpetual protest against its repetition, the Constitution of the United States, which recognizes and preserves the autonomy and independence , of the States — independence in their legislative and inde*79pendence in their judicial departments. Supervision over either the legislative or the judicial action of the States is in no case permissible except as to matters by the Constitution specifically authorized or delegated to the United States. Any interference with either, except as thus permitted, is an invasion of the authority of the State and, to that extent, a denial of its independence.”

The fallacy underlying the rule declared in Swift v. Tyson is made clear by Mr. Justice Holmes.23 The doctrine rests upon the assumption that there is “a transcendental body of law outside of any particular State but obligatory within it unless and until changed by statute,” that federal courts have the power to use their judgment as to what the rules of common law are; and that in the federal courts “the parties are entitled to an independent judgment on matters of general law "—:

“but law in the sense in which courts speak of it today does not exist without some definite authority behind it. The common law so far as it is enforced in a State, whether called common law or not, is not the common law generally but the law of that State existing by the authority of that State without regard to what it may .have been in England or anywhere else. . . .

“the authority and only authority is the State, and if that be so, the voice adopted by the State as its own [whether it be of its Legislature or of its Supremé Court] should utter the last word.”

Thus the doctrine of Swift v. Tyson is, as Mr. Justice Holmes said, “an unconstitutional assumption of powers by courts of the United States which no lapse of time or respectable array of opinion should make us hesitate to correct.” In disapproving that doctrine we do not hold *80unconstitutional § 34 of the Federal Judiciary Act of 1789 or any other Act of Congress. We merely declare that in applying the doctrine this Court and the lower courts have invaded rights whicíi in our opinion are reserved by the Constitution to the several States.

Fourth. The defendant contended that by the common law of Pennsylvania as declared by its highest court in Falchetti v. Pennsylvania R. Co., 307 Pa. 203; 160 A. 859, the only duty owed to the plaintiff was to refrain from wilful or wanton injury. The plaintiff denied that such is the Pennsylvania law.24 In support of their respective contentions the parties discussed and cited many decisions of the Supreme Court of the State. The Circuit Court of Appeals ruled that the question of liability is one of general law; and on thjat ground declined to decide the issue of state law. As. we hold this was error, the judgment is reversed and the case remanded to it for further proceedings in conformity with our opinion.

Reversed.

Mr. Justice Butler.

The case presented by the evidence is a simple one. Plaintiff was severely injured in Pennsylvania. While walking on defendant’s right of way along a much-used path at the end of the cross ties of its main track, he came into collision with an open door swinging from the side of a car in a train going in the opposite direction. Having been warned by whistle and headlight, he saw the locomo*81tive approaching and had time and space enough to step aside and so avoid danger. To justify his failure to get out of the way, he says that upon many other occasions he had safely walked there while trains'passed.

Invoking jurisdiction on the ground of. diversity of citizenship, plaintiff, a citizen .and resident of Pennsylvania, brought this suit to recover damages against, defendant, a New York corporation, in the federal court for the southern district of that State. The issues were whether negligence of defendant was a proximate cause of his injuries and whether negligence of plaintiff contributed. He claimed that, by hauling the car with the open door, defendant violated a duty to him. The defendant insisted that it violated no duty and that plaintiff’s injuries were caused by his own negligence. ..The jury gave him a verdict on which the trial court entered judgment; the circuit court of appeals affirmed. 90 F. (2d) 603.

Defendant maintained, citing Falchetti v. Pennsylvania R. Co., 307 Pa. 203; 160 A. 859, and Koontz v. B. & O. R. Co., 309 Pa. 122; 163 A. 212, that the only duty owed plaintiff was to refrain from willfully or wantonly injuring him; it argued that the courts of Pennsylvania had so ruled with respect to persons using a customary longitudinal path, as distinguished from one crossing the track. The plaintiff, insisted that the Pennsylvania decisions did not establish the rule for which the defendant contended.. Upon that issue the circuit court of appeals said (p. 604): “We need hot go into this' matter since the defendant concedes that the great weight of authority in other states is' to the contrary.- This concession is fatal to its contention, for upon questions of general law the federal courts are. free, in absence of a local statute, to exercise their independent judgment as to what the law is; and it is well settled that the question of the responsibility of a railroad for injuries caused by its servants is one of general law.” *82Upon that basis the court held the evidence sufficient to sustain a finding that plaintiff’s injuries were caused by the negligence of defendant. It also held the question of contributory negligence one for the jury.

Defendant’s petition for writ of certiorari presented two questions: Whether its duty toward plaintiff should have been determined in accordance with the law as found by the highest court of Pennsylvania, and whether the evidence conclusively showed plaintiff guilty of contributory negligence. Plaintiff contends that, as always heretofore held by this Court, the issues of negligence and contributory negligence are to be determined by general law against which local decisions may not be held conclusive; that defendant relies.on a solitary Pennsylvania case of doubtful applicability and that, even jtf the decisions of'the courts of that State were deemed controlling, the same result would have to be reached.

No constitutional question was suggested or argued below or here. And as a general rule, this Court will not consider any question not raised below and presented by the petition. Olson v. United States, 292 U. S. 246, 262. Johnson v. Manhattan Ry. Co., 289 U. S. 479, 494. Gunning v. Cooley, 281 U. S. 90, 98. Here it does not decide either of the questions presented but, changing the rule of decision in force since the foundation of the Government, remands the case td be adjudged according to a standard never before deemed permissible.

The opinion just announced states that “the question for decision is whether the oft-challenged doctrine of Swift v. Tyson [1842, 16 Pet. 1] shall now be disapproved.”

That case involved the construction of the Judiciary Act of 1789, § 34: “The laws of the several states, 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-*83the United States in cases where they apply.” Expressing the view of all the members of the Court, Mr. Justice Story said (p. 18): “In the ordinary use of language it will hardly be contended that the decisions of Courts constitute laws. They are, at most, only evidence of what- the laws are, and not. of themselves laws. They are often re-examined, reversed, and qualified by the Courts themselves, whenevér they are found to be either defective, or ill-founded, or otherwise incorrect. The laws of a -state are more usually understood to mean, the rules and enactments promulgated by the legislative authority thereof, or long established local customs having the force of laws. In all the various cases, which have hitherto come before us for decision, this Court have uniformly supposed, that the true interpretation of the thirty-fourth section limited its application to state laws strictly local, that is to say, to the positive statutes of the state, and the construction thereof adopted by the local tribunals, and to rights and titles' to things having a permanent locality, such as the rights and titles to' real- estate, and other matters immovable and intraterritorial in their nature and character. It never has been supposed by us, that the section did apply, or was designed to apply, to questions of a more general nature, not at all dependent upon local statutes or local usages of a fixed and permanent operation, as, for example, to the construction of ordinary contracts or other written instruments, and especially to questions of general commercial law, where the state .tribunals are called upon'to perform the like functions as ourselves, that is, to ascertain upon general reasoning and legal analogies, what is the true exposition of the contract or instrument, or what is the just rule furnished by the prin-. ciples of commercial law to govern the case. And we have not now the slightest difficulty in holding., that this section, upon its true intendment and construction, is strictly limited to local statutes and local usages of the .character *84before stated, and does not extend to contracts and other instruments of a commercial nature, the true interpretation and effect whereof are to be sought, not in the decisions of the local tribunals, but in the general principles and doctrines of commercial jurisprudence. Undoubtedly, the decisions of the local tribunals upon such subjects are entitled to, and will receive, the most deliberate attention and respect of this Court; but they cannot furnish positive rules, or conclusive authority, by which our own judgments are to be bound up and governed.” (Italics added.)

The doctrine of that case has been followed by this Court in an unbroken line of decisions. So far as appears, it was not questioned until more than 50 years later, and then by a single judge.1 Baltimore & Ohio R. Co. v. Baugh, 149 U. S. 368, 390. In that case, Mr. Justice Brewer, speaking for the Court, truly said (p. 373): “Whatever differences of opinion may have been expressed, have not been on the question whether a matter of general law should be settled by the independent judgment of this court, rather than through an adherence to the decisions of the state courts, but upon the other question, whether a given matter is one of local or of general law.”

And since that decision, the division of opinion in this Court has been one of the same character as it was before. In 1910, Mr. Justice Holmes, speaking for himself and two other Justices, dissented from the holding that a *85court of the United States was bound to exercise its own independent judgment in the construction of a conveyance made before the state courts had rendered an authoritative decision as to its meaning and effect. Kuhn v. Fairmont Coal Co., 215 U. S. 349. But that dissent accepted (p. 371) as ‘‘settled” the doctrine of Swift v. Tyson, and insisted (p. 372) merely that the case under consideration was by nature and necessity peculiarly local.

Thereafter, as before, the doctrine was constantly applied.2 In Black & White Taxicab Co. v. Brown & Yellow Taxicab Co., 276 U. S. 518, three judges dissented. The writer of the dissent, Mr. Justice Holmes, said, however (p. 535): “I should leave Swift v. Tyson undisturbed, as I indicated in Kuhn v. Fairmont Coal Co., but I would not allow it to spread the assumed dominion into new fields.”

No more unqualified application of the doctrine can be found than in decisions of this Court speaking through Mr. Justice Holmes. United Zinc Co. v. Britt, 258 U. S. 268. Baltimore & Ohio R. Co. v. Goodman, 275 U. S. 66, 70. Without in the slightest departing from that doctrine, but implicitly applying it, the strictnéss of the rule laid down in the Goodman case was somewhat ameliorated by Pokora v. Wabash Ry. Co., 292 U. S. 98.

Whenever possible, consistently with standards sustained by reason and authority constituting the general, law, this Court has followed applicable decisions of state courts. Mutual Life Ins. Co. v. Johnson, 293 U. S. 335, 339. See Burgess v. Seligman, 107 U. S. 20, 34. Black & White Taxicab Co. v. Brown & Yellow Taxicab Co., supra, 530. Unquestionably the issues off negligence and contributory negligence upon which decision of this case *86depends are questions of general law. Hough v. Railway Co., 100 U. S. 213, 226. Lake, Shore & M. S. Ry. Co. v. Prentice, 147 U. S. 101. Baltimore & Ohio R. Co. v. Baugh, supra. Gardner v. Michigan Central R. Co., 150 U. S. 349, 358. Central Vermont Ry. Co. v. White, 238 U. S. 507, 512. Baltimore & Ohio R. Co. v. Goodman, supra. Pokora v. Wabash Ry. Co., supra.

While amendments to § 34 have from time to time been suggested, the section., stands as originally enacted. Evidently Congress has intended throughout the years that the rule of decision as construed should continue to govern federal courts in trials at common law. The opinion just announced suggests that Mr. Warren’s research has established that from the beginning this Court has erroneously construed § 34. But that author’s “New Light on the History of the Federal Judiciary Act of 1789” does not purport to be authoritative and was intended to be no more than suggestive. The .weight to be given to his discovery has never been discussed at this bar. Nor does the. opinion indicate the ground, disclosed by the research. In his dissenting opinion in the Taxicab case, Mr. Justice Holmes referred to Mr., barren’s work but failed to persuade the Court that “laws” as used in § 34 included varying and possibly ill-considered rulings by the courts of á State on questions of. common law. See, e. g., Swift v. Tyson, supra, 16-17. It well may be that, if the Court should now call for argument of counsel on the basis of Mr. Warren’s research, it would adhere to the construction it has always put upon § 34-. Indeed, the opinion in this case so indicates. For it declares: “If only a question of statutory construction were involved, we should not be prepared to abandon a doctrine so widely applied throughout a century. But the unconstitutionality of the course pursued has now been made clear and compels us to do so.” This means that, so far as concerns the rule of decision now condemned, the Judiciary Act of 1789, passed to establish judicial *87courts to exert the judicial power of the United States, and especially § 34 of that Act as construed, is unconstitutional; that federal courts are now bound to follow decisions of the courts of the State in which the controversies arise; and that Congress is powerless otherwise to ordain. It is hard to foresee the consequences of the radical change so made. Our opinion in the Taxicab case cites numerous decisions of this Court which serve in part to indicate the field from which it is now intended forever to bar the federal courts. It extends to all matters of contracts and torts not positively governed by state enactments. Counsel searching for precedent and reasoning to disclose common-law principles on which to guide clients and conduct litigation are by this decision told that as to all of these questions the decisions of this Court and other federal courts are no longer anywhere authoritative.

This Court has often emphasized its reluctance to consider constitutional questions, and that legislation will not be held invalid as repugnant to the fundamental law if the case may be decided upon any other ground. In view of grave consequences liable to result from erroneous exertion of its power to set aside legislation, the Court should move cautiously, seek assistance of counsel, act only after ample deliberation, show that the question is before the Court, that its decision cannot be avoided by construction of the statute assailed or otherwise, indicate precisely the principle or provision of the Constitution held to have been transgressed, and fully disclose. the reasons and authorities found to warrant the conclusion of invalidity. These safeguards against the improvident use of the great power to invalidate legislation are so well-grounded and familiar that statement of reasons or citation of authority to support them is no longer necessary. But see e. g.: Charles River Bridge v. Warren Bridge, 11 Pet. 420, 553; Township of Pine Grove v. Talcott, 19 Wall. 666, 673; Chicago & G. T. Ry. Co. v. Wellman, 143 U. S. 339, 345; *88Baker v. Grice, 169 U. S. 284, 292; Martin v. District of Columbia, 205 U. S. 135, 140.

So far as appears, no litigant has ever challenged the power of Congress to establish the: rule as construed. It has so long endured that its destruction now without appropriate deliberation cannot be justified. There is nothing in the opinion to suggest that consideration of any constitutional question is necessary to a decision of the case. By way of reasoning, it contains nothing that requires the conclusion reached. Admittedly,- there is no authority to support that conclusion. Against the protest of those joining in this opinion, the Court declines to assign the case for reargument. It may not justly be assumed that the labor and argument of counsel for the parties would not disclose the right conclusion and aid the Court in the statement of reasons to support it. Indeed, it would have been appropriate to give Congress opportunity to be heard before devesting it of power to prescribe rules of decision to be followed' in the courts of the United States. See Myers v. United States, 272 U. S. 52, 176.

The course pursued by the Court in this case is repugnant to the Act of Congress of August 24, 1937, 50 Stat. 751. It declares: “That whenever the constitutionality of any Act of Congress affecting the public interest is drawn in question in any court of the United States in any suit or proceeding to which the United States, or any agency thereof, or any officer or employee thereof, as such officer or employee, is not a party, the court having jurisdiction of the suit or proceeding shall certify such fact to the Attorney General. In any such case the court shall permit the United States to intervene and become á party for presentation of evidence (if evidence is otherwise receivable in such suit or proceeding) and argument upon the question of the constitutionality of such Act.. .In any such suit or proceeding the United States shall, subject to the applicable provisions of law, have all the rights of a. *89party and the liabilities of a party as to court costs to the extent necessary for a proper presentation of the facts and law relating to the constitutionality of such Act.” That provision extends to this Court. § 5. If defendant had applied for and obtained the writ of certiorari upon the claim that, as now’ held, Congress has no power to prescribe the rule of decision, § 34 as construed, it would have been the duty of thi^ Court to issue the prescribed certificate to the Attorney General in order that the United States might intervene and be heard on .the constitutional question. Within the purpose of the statute and its true intent and meaning, the constitutionality of that measure has been “drawn in question.” Congress intended to give the United States the right to be heard in every case involving constitutionality of an Act affecting ihe public interest. In view of the rule that, in the absence of chállenge of constitutionality, statutes will not here be invalidated on that ground, the Act of August 24, 1937 extends to cases where constitutionality is first “drawn’ in question” by the Court. No extraordinary or-unusual action by the Court after submission of the cause should be permitted to frustrate the wholesome purpose of that Act. The duty it imposes ought here to be willingly assumed. If it were doubtful whether this case is within the scope of the Act, the Court should give the United States opportunity to intervene and, if so advised, to present argument on the constitutional question, for undoubtedly it is one of great public importance. That would be to construe the Act according to its meaning.

The Court’s opinion in its first sentence defines the question to be whether the doctrine of Swift v. Tyson shall now be disapproved; it recites (p. 72) that Congress is without power to prescribe rules of decision that have been followed by federal courts as s, result of the construction of § 34 in Swift v. Tyson and since; after discussion, it declares (pp. 77-78) that “the unconstitutionality of the course pursued [meanin the rule of decision *90resulting from that construction] compels" abandonment of the doctrine so long applied; and then near the end' of the last page the Court states that it does not hold § 34 unconstitutional, but merely that, in applying the doctrine of Swift v. Tyson construing it, this Court and the lower courts have invaded rights which are reserved by the Constitution to the several States. But, plainly through the form of words employed, the substance of the decision appears; it strikes down as unconstitutional § 34 as construed by our decisions; it divests the Congress of power to prescribe rules to be followed by federal courts when deciding questions of general law. In that broad field it compels this and the lower federal courts to follow decisions of the courts of a particular State.

I am of opinion that the constitutional validity of the rule need not be considered, because under the law, as found by the courts of Pennsylvania and -generally throughout the country, it is plain that the evidence required a finding that plaintiff was guilty of negligence that contributed to cause his injuries and that the judgment below should be reversed upon that ground.

Mr. Justice Reed.

I concur in the conclusion reached in this case, in the disapproval of the doctrine of Swift v. Tyson, and in the reasoning of the majority opinion except in so far as it relies upon the unconstitutionality of the “course pursued” by the federal courts.

The “doctrine of Swift v. Tyson,” as I understand it, is that the words “the laws,” as used in § 34, line one, of the Federal Judiciary Act of September 24, 1789, do not include in their meaning “the decisions of the local tribunals.” Mr. Justice Story, in deciding that point, said (16 Pet. 19):

*91“Undoubtedly, the decisions of the local tribunals upon such subjects are entitled to, and will receive, the most deliberate attention and respect of this Court; but they cannot furnish positive rules, or conclusive authority, by which our own judgments are to be bound up and governed.”

To decide the case now before us and to “disapprove” the doctrine of Swift v. Tyson requires only that we say that the words “the laws” include in their meaning the decisions of the local tribunals. As the majority opinion shows, by its reference to Mr. Warren’s researches and the first quotation from Mr. Justice Holmes, that this Court is now of the view that “laws” includes “decisions,” it is unnecessary to go further and declare that the “course pursued” was “unconstitutional,” instead of merely erroneous.

The “unconstitutional” course referred to in the majority opinion is apparently the ruling in Swift v. Tyson that the supposed omission of Congress to legislate as to the effect of decisions leaves federal courts free to interpret general law for themselves. I am not at all sure whether, in the absence of federal statutory direction, federal courts would be compelled to follow state decisions. There was sufficient doubt about the matter in 1789 to induce the first Congress to legislate. No former opinions of this Court have passed upon it. Mr. Justice Holmes evidently saw nothing “unconstitutional” which required the overruling of Swift v. Tyson, for he said in the very opinion quoted by the majority, “I should leave Swift v. Tyson undisturbed, as I indicated in Kuhn v. Fairmont Coal Co., but I would not allow it to spread the assumed dominion into new fields.” Black & White Taxicab Co. v. Brown & Yellow Taxicab Co., 276 U. S. 518, 535. If the opinion commits this Court to the position that the Congress is without power to declare what rules of substantive law shall govern the federal courts, *92that conclusion also seems questionable. The line between procedural and substantive law is hazy but no one doubts federal power over procedure. Wayman v. Southard, 10 Wheat. 1. The Judiciary Article and the “necessary and proper” clause of Article One may fully authorize legislation, such as this section of the Judiciary Act.

In this Court, stare decisis, in statutory construction, is a useful rule, hot an inexorable command. Burnet v. Coronado Oil & Gas Co., 285 U. S. 393, dissent, p. 406, note 1. Compare Read v. Bishop of Lincoln, [1892] A. C. 644, 655; London Street Tramways Co. v. London County Council, [1898] A. C. 375, 379. It seems preferable to overturn an established construction- of an Act of Congress, rather than, in the circumstances of this case, to interpret the Constitution. Cf. United States v. Delaware & Hudson Co., 213 U. S. 366.

. There is no occasion to discuss further the range or soundness of these few; phrases of the opinion. It is sufficient now to call attention, to them and express my own non-acquiescence.

Mr. Justice Frankfurter

delivered the opinion of the Court.

In Russell v. Todd, 309 U. S. 280, 294, we had “no occasion to consider the extent to which federal courts, in the exercise of the authority conferred upon them by Congress to administer equitable remedies, are bound to follow state statutes and decisions affecting those remedies.” The *100question thus carefully left open in Russell v. Todd is now before us. It arises under the following circumstances.

In May, 1930, Yan Sweringen Corporation issued notes to the amount of $30,000,000. Under an indenture of the same date, petitioner, Guaranty Trust Co., was named trustee with power and obligations to enforce the rights of the noteholders in the assets of the Corporation and of the Van Sweringen brothers. In October, 1930, petitioner, with other banks, made large advances to companies affiliated with the Corporation and wholly controlled by the Van Sweringens. In October, 1931, when it was apparent that the Corporation could not meet its obligations, Guaranty cooperated in a plan for the purchase of the outstanding notes on the basis of cash for 50% of the face value of the notes and twenty shares of Van Swer-ingen Corporation’s stock for each $1,000 note. This exchange offer remained open until December 15, 1931.

Respondent York received $6,000 of the notes as a gift in 1934, her donor not having accepted the offer of exchange. In April, 1940, three accepting noteholders began suit against petitioner, charging fraud and misrepresentation. Respondent’s application to intervene in that suit was denied, 117 F. 2d 95, and summary judgment in favor of Guaranty was affirmed. Hackner v. Morgan, 130 F. 2d 300. After her dismissal from the Hackner litigation, respondent, on January 22, 1942, began the present proceedings.

The suit, instituted as a class action on behalf of non-accepting noteholders and brought in a federal court solely because of diversity of citizenship, is based on an alleged breach of trust by Guaranty in that it failed to protect the interests of the noteholders in assenting to the exchange offer and failed to disclose its self-interest when sponsoring the offer. Petitioner moved for summary judgment, which was granted, upon the authority of the Hackner case. On appeal, the Circuit Court of Appeals, one Judge dissenting, *101found that the Hackner decision did not foreclose this suit, and held that in a suit brought on the equity side of a federal district court that court is not required to apply the' State statute of limitations that would govern like suits in the courts of a State where the federal court is sitting even though the exclusive basis of federal jurisdiction is diversity of citizenship. 143 F. 2d 503. The importance of the question for the disposition of litigation in the federal courts led us to bring the case here. 323 U. S. 693.

In view of the basis of the decision below, it is not for us to consider whether the New York statute would actually bar this suit were it brought in a State court. Our only concern is with the holding that the federal courts in a suit like this are not bound by local law.

We put to one side the considerations relevant in disposing of questions that arise when a federal court is adjudicating a claim based on a federal law. See, for instance, Board of Comm’rs v. United States, 308 U. S. 343; Deitrick v. Greaney, 309 U. S. 190; D’Oench, Duhme & Co. v. F. D. I. C., 315 U. S. 447; Clearfield Trust Co. v. United States, 318 U. S. 363; O’Brien v. Western Union Telegraph Co., 113 F. 2d 539. Our problem only touches transactions for which rights and obligations are created by one of the States, and for the assertion of which, in case of diversity of the citizenship of the parties, Congress has made a federal court another available forum.

Our starting point must be the policy of federal jurisdiction which Erie R. Co. v. Tompkins, 304 U. S. 64, embodies. In overruling Swift v. Tyson, 16 Pet. 1, Erie R. Co. v. Tompkins did not merely overrule a venerable case. It overruled a particular way of looking at law which dominated the judicial process long after its inadequacies had been laid bare. See, e. g., Field, J., dissenting in Baltimore & Ohio R. Co. v. Baugh, 149 U. S. 368, 391; Holmes, J., dissenting in Kuhn v. Fairmont Coal Co., 215 U. S. 349, *102370, and in Black & White Taxi. Co. v. Brown & Yellow Taxi. Co., 276 U. S. 518, 532; Erie R. Co. v. Tompkins, supra at 73, note 6. Law was conceived as a “brooding omnipresence” of Reason, of which decisions were merely evidence and not themselves the controlling formulations. Accordingly, federal courts deemed themselves free to ascertain what Reason, and therefore Law, required wholly independent of authoritatively declared State law, even in cases where a legal right as the basis for relief was created by State authority and could not be created by federal authority and the case got into a federal court merely because it was “between Citizens of different States” under Art. Ill, § 2 of the Constitution of the United States.

This impulse to freedom from the rules that controlled State courts regarding State-created rights was so strongly rooted in the prevailing views concerning the nature of law, that the federal courts almost imperceptibly were led to mutilating construction even of the explicit command given to them by Congress to apply State law in cases purporting to enforce the law of a State. See § 34 of the Judiciary Act of 1789, 1 Stat. 73, 92. The matter was fairly summarized by the statement that “During the period when Swift v. Tyson (1842-1938) ruled the decisions of the federal courts, its theory of their freedom in matters of general law from the authority of state courts pervaded opinions of this Court involving even state statutes or local law.” Vandenbark v. Owens-Illinois Co., 311 U. S. 538, 540.

In relation to the problem now here, the real significance of Swift v. Tyson lies in the fact that it did not enunciate novel doctrine. Nor was it restricted to its particular situation. It summed up prior attitudes and expressions in cases that had come before this Court and lower federal courts for at least thirty years, at law as well as in equity.1 *103The short of it is that the doctrine was congenial to the jurisprudential climate of the time. Once established, judicial momentum kept it going. Since it was conceived that there was “a transcendental body of law outside of any particular State but obligatory within it unless and until changed by statute,” 276 U. S. 518, 532, 533, State court decisions were not “the law” but merely someone’s opinion — to be sure an opinion to be respected — concerning the content of this all-pervading law. Not unnaturally, the federal courts assumed power to find for themselves the content of such a body of law. The notion was stimulated by the attractive vision of a uniform body of federal law. To such sentiments for uniformity of decision and freedom from diversity in State law the federal courts gave currency, particularly in cases where equitable remedies were sought, because equitable doctrines are so often cast in terms of universal applicability when close analysis of the source of legal enforceability is not demanded.

In exercising their jurisdiction on the ground of diversity of citizenship, the federal courts, in the long course of their history, have not differentiated in their regard for State law between actions at law and suits in equity. Although § 34 of the Judiciary Act of 1789, 1 Stat. 73, 92, 28 U. S. C. § 725, directed that the “laws of the several states . . . shall be regarded as rules of decision in trials at common law . . . ,” this was deemed, consistently for over a hundred years, to be merely declaratory of what would in *104any event have governed the federal courts and therefore was equally applicable to equity suits.2 See Hawkins v. Barney’s Lessee, 5 Pet. 457, 464; Mason v. United States, 260 U. S. 545, 559; Erie R. Co. v. Tompkins, supra at 72. Indeed, it may fairly be said that the federal courts gave greater respect to State-created “substantive rights,” Pusey & Jones Co. v. Hanssen, 261 U. S. 491, 498, in equity than they gave them on the law side, because rights at law were usually declared by State courts and as such increasingly flouted by extension of the doctrine of Swift v. Tyson, while rights in equity were frequently definéd by legislative enactment and as such known and respected by the federal courts. See, e. g., Clark v. Smith, 13 Pet. 195; Scott v. Neely, 140 U. S. 106; Louisville & Nashville R. Co. v. Western Union Co., 234 U. S. 369, 374-76; Pusey & Jones Co. v. Hanssen, supra at 498.

Partly because the States in the early days varied greatly in the manner in which equitable relief was afforded and in the extent to which it was available, see, e. g., Fisher, The Administration of Equity Through Common Law Forms (1885) 1 L. Q. Rev. 455; Woodruff, Chancery in Massachusetts (1889) 5 L. Q. Rev. 370; Laussat, Essay on Equity in Pennsylvania (1826), Congress provided that “the forms and modes of proceeding in suits ... of eq*105uity” would conform to the settled uses of courts of equity. § 2,1 Stat. 275, 276, 28 U. S. C. § 723. But this enactment gave the federal courts no power that they would not have had in any event when courts were given “cognizance,” by the first Judiciary Act, of suits “in equity.” From the beginning there has been a good deal of talk in the cases that federal equity is a separate legal system. And so it is, properly understood. The suits in equity of which the federal courts have had “cognizance” ever since 1789 constituted the body of law which had been transplanted to this country from the English Court of Chancery. But this system of equity “derived its doctrines, as well as its powers, from its mode of giving relief.” Langdell, Summary of Equity Pleading (1877) xxvii. In giving federal courts “cognizance” of equity suits in cases of diversity jurisdiction, Congress never gave, nor did the federal courts ever claim, the power to deny substantive rights created by State law or to create substantive rights denied by State law.

This does not mean that whatever equitable remedy is available in a State court must be available in a diversity suit in a federal court, or conversely, that a federal court may not afford an equitable remedy not available in a State court. Equitable relief in a federal court is of course subject to restrictions: the suit must be within the traditional scope of equity as historically evolved in the English Court of Chancery, Payne v. Hook, 7 Wall. 425, 430; Atlas Ins. Co. v. Southern, Inc., 306 U. S. 563, 568; Sprague v. Ticonic Bank, 307 U. S. 161, 164-165; a plain, adequate and complete remedy at law must be wanting, § 16, 1 Stat. 73, 82, 28 U. S. C. § 384; explicit Congressional curtailment of equity powers must be respected, see, e. g., Norris-LaGuardia Act, 47 Stat. 70, 29 U. S. C. § 101 et seq.; the constitutional right to trial by jury cannot be evaded, Whitehead v. Shattuck, 138 U. S. 146. That a State may authorize its courts to give equitable relief unhampered *106by any or all such restrictions cannot remove these fetters from the federal courts. See Clark v. Smith, supra at 203 ; Broderick’s Will, 21 Wall. 503, 519-20; Louisville & Nashville R. Co. v. Western Union Co., supra at 376; Henrietta Mills v. Rutherford Co., 281 U. S. 121, 127-28; Atlas Ins. Co. v. Southern, Inc., supra at 568-70. State law cannot define the remedies which a federal court must give simply because a federal court in diversity jurisdiction is available as an alternative tribunal to the State’s courts.3 Contrariwise, a federal court may afford an equitable remedy for a substantive right recognized by a State even though a State court cannot give it. Whatever contradiction or confusion may be produced by a medley of judicial phrases severed from their environment, the body of adjudications concerning equitable relief in diversity cases leaves no doubt that the federal courts enforced State-created substantive rights if the mode of proceeding and remedy were consonant with the traditional body of equitable remedies, practice and procedure, and in so doing *107they were enforcing rights created by the States and not arising under any inherent or statutory federal law.4

Inevitably, therefore, the principle of Erie R. Co. v. Tompkins, an action at law, was promptly applied to a suit in equity. Ruhlin v. N. Y. Life Ins. Co., 304 U. S. 202.

And so this case reduces itself to the narrow question whether, when no recovery could be had in a State court because the action is barred by the statute of limitations, a federal court in equity can take cognizance of the suit because there is diversity of citizenship between the parties. Is the outlawry, according to State law, of a claim created by the States a matter of “substantive rights” to be respected by a federal court of equity when that court’s jurisdiction is dependent on the fact that there is a State-*108created right, or is such statute of “a mere remedial character,” Henrietta Mills v. Rutherford Co., supra at 128, which a federal court may disregard?

Matters of “substance” and matters of “procedure” are much talked about in the books as though they defined a great divide cutting across the whole domain of law. But, of course, “substance” and “procedure” are the same keywords to very different problems. Neither “substance” nor “procedure” represents the same invariants. Each implies different variables depending upon the particular problem for which it is used. See Home Ins. Co. v. Dick, 281 U. S. 397, 409. And the different problems are only distantly related at best, for the terms are in common use in connection with situations turning on such different considerations as those that are relevant to questions pertaining to ex post facto legislation, the impairment of the obligations of contract, the enforcement of federal rights in the State courts and the multitudinous phases of the conflict of laws. See, e. g., American Railway Express Co. v. Levee, 263 U. S. 19, 21; Davis v. Wechsler, 263 U. S. 22, 24-25; Worthen Co. v. Kavanaugh, 295 U. S. 56, 60; Garrett v. Moore-McCormack Co., 317 U. S. 239, 248-49; and see Tunks, Categorization and Federalism: “Substance” and “Procedure” After Erie Railroad v. Tompkins (1939) 34 Ill. L. Rev. 271, 274-276; Cook, Logical and Legal Bases of Conflict of Laws (1942) 163-165.

Here we are dealing with a right to recover derived not from the United States but from one of the States. When, because the plaintiff happens to be a non-resident, such a right is enforceable in a federal as well as in a State court, the forms and mode of enforcing the right may at times, naturally enough, vary because the two judicial systems are not identic. But since a federal court adjudicating a State-created right solely because of the diversity of citizenship of the parties is for that purpose, in effect, only another court of the State, it cannot afford recovery *109if the right to recover is made unavailable by the State nor can it substantially affect the enforcement of the right as given by the State.

And so the question is not whether a statute of limitations is deemed a matter of “procedure” in some sense. The question is whether such a statute concerns merely the manner and the means by which a right to recover, as recognized by the State, is enforced, or whether such statutory limitation is a matter of substance in the aspect that alone is relevant to our problem, namely, does it significantly affect the result of a litigation for a federal court to disregard a law of a State that would be controlling in an action upon the same claim by the same parties in a State court?

It is therefore immaterial whether statutes of limitation are characterized either as “substantive” or “procedural” in State court opinions in any use of those terms unrelated to the specific issue before us. Erie R. Co. v. Tompkins was not an endeavor to formulate scientific legal terminology. It expressed a policy that touches vitally the proper distribution of judicial power between State and federal courts. In essence, the intent of that decision was to insure that, in all cases where a federal court is exercising jurisdiction solely because of the diversity of citizenship of the parties, the outcome of the litigation in the federal court should be substantially the same, so far as legal rules determine the outcome of a litigation, as it would be if tried in a State court. The nub of the policy that underlies Erie R. Co. v. Tompkins is that for the same transaction the accident of a suit by a non-resident litigant in a federal court instead of in a State court a block away should not lead to a substantially different result. And so, putting to one side abstractions regarding “substance” and “procedure,” we have held that in diversity cases the federal courts must follow the law of the State as to burden of proof, Cities Service Co. v. Dunlap, 308 U. S. 208, as to conflict of laws, Klaxon Co. v. Stentor Co., *110313 U. S. 487, as to contributory negligence, Palmer v. Holman, 318 U. S. 109; 117. And see Sampson v. Channell, 110 F. 2d 754. Erie R. Co. v. Tompkins has been applied with an eye alert to essentials in avoiding disregard of State law in diversity cases in the federal courts. A policy so important to our federalism must be kept free from entanglements with analytical or terminological niceties.

Plainly enough, a statute that would completely bar recovery in a suit if brought in a State court bears on a State-created right vitally and not merely formally or negligibly. As to consequences that so intimately affect recovery or non-recovery a federal court in a diversity case should follow State law. See Morgan, Choice of Law Governing Proof (1944) 58 Harv. L. Rev. 153, 155-158. The fact that under New York law a statute of limitations might be lengthened or shortened, that a security may be foreclosed though the debt be barred, that a barred debt may be used as a set-off, are all matters of local law properly to be respected by federal courts sitting in New York when their incidence comes into play there.5 Such particular rules of local law, however, do not in the slightest change the crucial consideration that if a plea of the statute of limitations would bar recovery in a State court, a federal court ought not to afford recovery.

Prior to Erie R. Co. v. Tompkins it was not necessary, as we have indicated, to make the critical analysis required by the doctrine of that case of the nature of jurisdiction of the federal courts in diversity cases. But even before Erie R. Co. v. Tompkins, federal courts relied on statutes of limitations of the States in which they sat. In suits at *111law State limitations statutes were held to be “rules of decision” within § 34 of the Judiciary Act of 1789 and as such applied in “trials at common law.” M’Cluny v. Sullivan, 3 Pet. 270; Bank of Alabama v. Dalton, 9 How. 522; Leffingwell v. Warren, 2 Black 599; Bauserman v. Blunt, 147 U. S. 647. While there was talk of freedom of equity from such State statutes of limitations, the cases generally refused recovery where suit was barred in a like situation in the State courts, even if only by way of analogy. See, e. g., Godden v. Kimmell, 99 U. S. 201; Alsop v. Riker, 155 U. S. 448; Benedict v. City of New York, 250 U. S. 321, 327-328. However in Kirby v. Lake Shore & M. S. R. Co., 120 U. S. 130, the Court disregarded a State statute of limitations where the Court deemed it inequitable to apply it.

To make an exception to Erie R. Co. v. Tompkins on the equity side of a federal court is to reject the considerations of policy which, after long travail, led to that decision. Judge Augustus N. Hand thus summarized below the fatal objection to such inroad upon Erie R. Co. v. Tompkins: “In my opinion it would be a mischievous practice to disregard state statutes of limitation whenever federal courts think that the result of adopting them may be inequitable. Such procedure would promote the choice of United States rather than of state courts in order to gain the advantage of different laws. The main foundation for the criticism of Swift v. Tyson was that a litigant in cases where federal jurisdiction is based only on diverse citizenship may obtain a more favorable decision by suing in the United States courts.” 143 F. 2d 503, 529, 531.

Diversity jurisdiction is founded on assurance to nonresident litigants of courts free from susceptibility to potential local bias. The Framers of the Constitution, according to Marshall, entertained “apprehensions” lest distant suitors be subjected to local bias in State courts, or, at least, viewed with “indulgence the possible fears and apprehensions” of such suitors. Bank of the United States *112v. Deveaux, 5 Cranch 61, 87. And so Congress afforded out-of-State litigants another tribunal, not another body of law. The operation of a double system of conflicting laws in the same State is plainly hostile to the reign of law. Certainly, the fortuitous circumstance of residence out of a State of one of the parties to a litigation ought not to give rise to a discrimination against others equally concerned but locally resident. The source of substantive rights enforced by a federal court under diversity jurisdiction, it cannot be said too often, is the law of the States. Whenever that law is authoritatively declared by a State, whether its voice be the legislature or its highest court, such law ought to govern in litigation founded on that law, whether the forum of application is a State or a federal court and whether the remedies be sought at law or may be had in equity.

Dicta may be cited characterizing equity as an independent body of law. To the extent that we have indicated, it is. But insofar as these general observations go beyond that, they merely reflect notions that have been replaced by a sharper analysis of what federal courts do when they enforce rights that have no federal origin. And so, before the true source of law that is applied by the federal courts under diversity jurisdiction was fully explored, some things were said that would not now be said. But nothing that was decided, unless it be the Kirby case, needs to be rejected.

The judgment is reversed and the case is remanded for proceedings not inconsistent with this opinion.

So ordered.

Mr. Justice Rutledge.

I dissent. If the policy of judicial conservatism were to be followed in this case, which forbids deciding constitu*113tional and other important questions hypothetically or prematurely, I would favor remanding the cause to the Court of Appeals for determination of the narrow and comparatively minor question whether, under the applicable local law, the cause of action has been barred by lapse of time. That question has not been decided,1 may be determined in respondent’s favor, and in that event the important question affecting federal judicial power now resolved, in a manner contrary to all prior decision here, will have been determined without substantial ultimate effect upon the litigation.2

But the Court conceives itself confronted with the necessity for making that determination and in doing so overturns a rule of decision which has prevailed in the federal courts from almost the beginning. I am unable to assent to that decision, for reasons stated by the Court of Appeals3 and others to be mentioned only briefly. One may give full adherence to the rule of Erie R. Co. v. Tompkins, 304 U. S. 64, and its extension to cases in equity in so far as they affect clearly substantive'rights, without conceding or assuming that the long tradition, both federal and state, which regards statutes of limitations as falling within the category of remedial rather than substantive law, necessarily must be ruled in the same way; and without conceding further that only a different jurisprudential climate or a kind of “brooding omnipresence in the sky” *114has dictated the hitherto unvaried policy of the federal courts in their general attitude toward the strict application of local statutes of limitations in equity causes.

If any characteristic of equity jurisprudence has descended unbrokenly from and within “the traditional scope of equity as historically evolved in the English Court of Chancery,” it is that statutes of limitations, often in terms applying only to actions at law, have never been deemed to be rigidly applicable as absolute barriers to suits in equity as they are to actions at law.4 That tradition, it would seem, should be regarded as having been incorporated in the various Acts of Congress which have conferred equity jurisdiction upon the federal courts. So incorporated, it has been reaffirmed repeatedly by the decisions of this and other courts.5 It is now excised from those Acts. If there is to be excision, Congress, not this Court, should make it.

Moreover, the decision of today does not in so many words rule that Congress could not authorize the federal courts to administer equitable relief in accordance with the substantive rights of the parties, notwithstanding state courts had been forbidden by local statutes of limitations to do so. Nevertheless the implication to that effect seems strong, in view of the reliance upon Erie R. Co. v. Tompkins.6 In any event, the question looms more largely in the issues than the Court’s opinion appears to *115make it. For if legislative acquiescence in long-established judicial construction can make it part of a statute, it has done so in this instance. More is at stake in the implications of the decision, if not in the words of the opinion, than simply bringing federal and local law into accord upon matters clearly and exclusively within the constitutional power of the state to determine. It is one thing to require that kind of an accord in diversity cases when the question is merely whether the federal court must follow the law of the state as to burden of proof, Cities Service Co. v. Dunlap, 308 U. S. 208; contributory negligence, Palmer v. Hoffman, 318 U. S. 109, 117; or perhaps in application of the so-called parol evidence rule. These ordinarily involve matters of substantive law, though nominated in terms of procedure. But in some instances their application may lie along the border between procedure or remedy and substance, where the one may or may not be in fact but another name for the other. It is exactly in this borderland, where procedural or remedial rights may or may not have the effect of determining the substantive ones completely, that caution is required in extending the rule of the Erie case by the very rule itself.

The words “substantive” and “procedural” or “remedial” are not talismanic. Merely calling a legal question by one or the other does not resolve it otherwise than as a purely authoritarian performance. But they have come to designate in a broad way large and distinctive legal domains within the greater one of the law and to mark, though often indistinctly or with overlapping limits, many divides between such regions.

One of these historically has been the divide between the substantive law and the procedural or remedial law to be applied by the federal courts in diversity cases, a division sharpened but not wiped out by Erie R. Co. v. Tompkins and subsequent decisions extending the scope *116of its ruling. The large division between adjective law and substantive law still remains, to divide the power of Congress from that of the states and consequently to determine the power of the federal courts to apply federal law or state law in diversity matters.

This division, like others drawn by the broad allocation of adjective or remedial and substantive, has areas of admixture of these two aspects of the law. In these areas whether a particular situation or issue presents one aspect or the other depends upon how one looks at the matter. As form cannot always be separated from substance in a work of art, so adjective or remedial aspects cannot be parted entirely from substantive ones in these borderland regions.

Whenever this integration or admixture prevails in a substantial measure, so that a clean break cannot be made, there is danger either of nullifying the power of Congress to control not only how the federal courts may act, but what they may do by way of affording remedies, or of usurping that function, if the Erie doctrine is to be expanded judicially to include such situations to the utmost extent.

It may be true that if the matter were wholly fresh the barring of rights in equity by statutes of limitation would seem to partake more of the substantive than of the remedial phase of law. But the matter is not fresh and it is not without room for debate. A long tradition, in the states and here, as well as in the common law which antedated both state and federal law, has emphasized the remedial character of statutes of limitations, more especially in application to equity causes, on many kinds of issues requiring differentiation of such matters from more clearly and exclusively substantive ones. We have recently reaffirmed the distinction in relation to the power of a state to change its laws with retroactive effect, giving renewed vigor, if not new life to Campbell v. Holt, 115 *117U. S. 620. Chase Securities Corp. v. Donaldson, 325 U. S. 304. Similar, though of course not identical, arguments were advanced in that case to bring about departure from the long-established rule, but without success. The tradition now in question is equally long and unvaried. I cannot say the tradition is clearly wrong in this case more than in that. Nor can I say, as was said in the Erie case, that the matter is beyond the power of Congress to control. If that be conceded, I think Congress should make the change if it is to be made. The Erie decision was rendered in 1938. Seven years have passed without action by Congress to extend the rule to these matters. That is long enough to justify the conclusion that Congress also regards them as not governed by Erie and as wishing to make no change. This should be reason enough for leaving the matter at rest until it decides to act.

Finally, this case arises from what are in fact if not in law interstate transactions.7 It involves the rights of security holders in relation to securities which were distributed not in New York or Ohio alone but widely throughout the country. They are the kind of rights which Congress acted to safeguard when it adopted the Securities and Exchange legislation.8 Specific provisions of that legislation are not involved in this litigation. The broad policies underlying it may be involved or affected, *118namely, by the existence of adequate federal remedies, whether judicial or legislative, for the protection of security holders against the misconduct of issuers or against the breach of rights by trustees. Even though the basic rights may be controlled by state law, in such situations the question is often a difficult one whether the law of one state or another applies; and this is true not only of rights clearly substantive but also of those variously characterized as procedural or remedial and substantive which involve the application of statutes of limitations.

Applicable statutes of limitations in state tribunals are not always the ones which would apply if suit were instituted in the courts of the state which creates the substantive rights for which enforcement is sought. The state of the forum is free to apply its own period of limitations, regardless of whether the state originating the right has barred suit upon it.9 Whether or not the action will be held to be barred depends therefore not upon the law of the state which creates the substantive right, but upon the law of the state where suit may be brought. This in turn will depend upon where it may be possible to secure service of process, and thus jurisdiction of the person of the defendant. It may be therefore that because of the plaintiff's inability to find the defendant in the jurisdiction which creates his substantive right, he will be foreclosed of remedy by the sheer necessity of going to the haven of refuge within which the defendant confines its “presence" for jurisdictional purposes. The law of the latter may bar the suit even though suit still would be allowed under the law of the state creating the substantive right.

It is not clear whether today's decision puts it into the power of corporate trustees, by confining their jurisdictional “presence" to states which allow their courts to give equitable remedies only within short periods of time, to *119defeat the purpose and intent of the law of the state creating the substantive right. If so, the “right” remains alive, with full-fledged remedy, by the law of its origin, and because enforcement must be had in another state, which affords refuge against it, the remedy and with it the right are nullified. I doubt that the Constitution of the United States requires this, or that the Judiciary Acts permit it. A good case can be made, indeed has been made, that the diversity jurisdiction was created to afford protection against exactly this sort of nullifying state legislation.10

In my judgment this furnishes added reason for leaving any change, if one is to be made, to the judgment of Congress. The next step may well be to say that in applying the doctrine of laches a federal court must surrender its own judgment and attempt to find out what a state court sitting a block away would do with that notoriously amorphous doctrine.

Mr. Justice Brennan

delivered the opinion of the Court.

This case was brought in the District Court for the Western District of South Carolina. Jurisdiction was based on diversity of citizenship. 28 U. S. C. § 1332. The petitioner, a resident of North Carolina, sued respondent, a South Carolina corporation, for damages for injuries allegedly caused by the respondent’s negligence. He had judgment on a jury verdict. The Court of Appeals for the Fourth Circuit reversed and directed the entry of judgment for the respondent. 238 F. 2d 346. We granted certiorari, 352 U. S. 999, and subsequently ordered reargument, 355 U. S. 950.

The respondent is in the business of selling electric power to subscribers in rural sections of South Carolina. The petitioner was employed as a lineman in the construction crew of a construction contractor. The contractor, R. H. Bouligny, Inc., held a contract with the respondent in the amount of $334,300 for the building of some 24 miles of new power lines, the reconversion to higher capacities of about 88 miles of existing lines, and the construction of 2 new substations and a breaker sta*527tion. The petitioner was injured while connecting power lines to one of the new substations.

One of respondent’s affirmative defenses was that, under the South Carolina Workmen’s Compensation Act,1 the petitioner — because the work contracted to be done by his employer was work of the kind also done by the respondent’s own construction and maintenance crews— had the status of a statutory employee of the respondent and was therefore barred from suing the respondent at law because obliged to accept statutory compensation benefits as the exclusive remedy for his injuries.2 Two ques*528tions concerning this defense are before us: (1) whether the Court of Appeals erred in directing judgment for respondent without a remand to give petitioner an opportunity to introduce further evidence; and (2) whether petitioner, state practice notwithstanding, is entitled to a jury determination of the factual issues raised by this defense.

I.

The Supreme Court of South Carolina has held that there is no particular formula by which to determine whether an owner is a statutory employer under § 72-111. In Smith v. Fulmer, 198 S. C. 91, 97, 15 S. E. 2d 681, 683, the State Supreme Court said:

“And the opinion in the Marchbanks case [Marchbanks v. Duke Power Co., 190 S. C. 336, 2 S. E. 2d 825, said to be the “leading case” under the statute] reminds us that while the language of the statute is plain and unambiguous, there are so many different factual situations which may arise that no easily applied formula can be laid down for the determination of all cases. In other words, ‘it is often a matter of extreme difficulty to decide whether the work in a given case falls within the designation of the statute. It is in each case largely a question of degree and of fact.' ”

The respondent's manager testified on direct examination that three of its substations were built by the respondent’s own construction and maintenance crews. When pressed on cross-examination, however, his answers left his testimony in such doubt as to lead the trial judge to say, “I understood he changed his testimony, that they had not built three.” But the credibility of the manager’s testimony, and the general question whether the evidence in support of the affirmative defense presented *529a jury issue, became irrelevant because of the interpretation given § 72-111 by the trial judge. In striking respondent’s affirmative defense at the close of all the evidence3 he ruled that the respondent was the statutory employer of the petitioner only if the construction work done by respondent’s crews was done for somebody else, and was not the statutory employer if, as the proofs showed, the crews built facilities only for the respondent’s own use. “My idea of engaging in the business is to do something for somebody else. What they [the respondent] are doing — and everything they do about repairing lines and building substations, they do it for themselves.” On this view of the meaning of the statute, the evidence, even accepting the manager’s testimony on direct examination as true, lacked proof of an essential element of the affirmative defense, and there was thus nothing for the petitioner to meet with proof of his own.

The Court of Appeals disagreed with the District Court’s construction of § 72-111. Relying on the decisions of the Supreme Court of South Carolina, among others, in Marchbanks v. Duke Power Co., 190 S. C. 336, 2 S. E. 2d 825, and Boseman v. Pacific Mills, 193 S. C. 479, 8 S. E. 2d 878, the Court of Appeals held that the statute granted respondent immunity from the action if the proofs established that the respondent’s own crews had constructed lines and substations which, like the work contracted to the petitioner’s employer, were necessary for the distribution of the electric power which the respondent was in the business of selling. We ordinarily accept the interpretation of local law by the Court of *530Appeals, cf. Ragan v. Merchants Transfer Co., 337 U. S. 530, 534, and do so readily here since neither party now disputes the interpretation.

However, instead of ordering a new trial at which the petitioner might offer his own proof pertinent to a determination according to the correct interpretation, the Court of Appeals made its own determination on the record and directed a judgment for the respondent. The court noted that the Rural Electric Cooperative Act of South Carolina4 authorized the respondent to construct, acquire, maintain, and operate electric generating plants, buildings, and equipment, and any and all kinds of property which might be necessary or convenient to accomplish the purposes for which the corporation was organized, and pointed out that the work contracted to the petitioner’s employer was of the class which respondent was empowered by its charter to perform.

The court resolved the uncertainties in the manager’s testimony in a manner largely favorable to the respondent: “The testimony with respect to the construction of the substations of Blue Ridge, stated most favorably to the . . . [petitioner], discloses that originally Blue Ridge built three substations with its own facilities, but that all of the substations which were built after the war, including the six it was operating at the time of the accident, were constructed for it by independent contractors, and that at the time of the accident it had no one in its direct employ capable of handling the technical detail of substation construction.” 238 F. 2d 346, 350.

The court found that the respondent financed the work contracted to the petitioner’s employer with a loan from the United States, purchased the materials used in the work, and entered into an engineering service contract with an independent engineering company for the design *531and supervision of the work, concluding from these findings that “the main actor in the whole enterprise was the Cooperative itself.” Ibid.

Finally, the court held that its findings entitled the respondent to the direction of a judgment in its favor. “. . . [Tjhere can be no doubt that Blue Ridge was not only in the business of supplying electricity to rural communities, but also in the business of constructing the lines and substations necessary for the distribution of the product . . . .” Id., at 351.

While the matter is not adverted to in the court’s opinion, implicit in the direction of verdict is the holding that the petitioner, although having no occasion to do so under the District Court’s erroneous construction of the statute, was not entitled to an opportunity to meet the respondent’s case under the correct interpretation. That holding is also implied in the court’s denial, without opinion, of petitioner’s motion for a rehearing sought on the ground that “. . . [T]he direction to enter judgment for the defendant instead of a direction to grant a new trial denies plaintiff his right' to introduce evidence in contradiction to that of the defendant on the issue of defendant’s affirmative defense, a right which he would have exercised if the District Judge had ruled adversely to him on his motion to dismiss, and thus deprives him of his constitutional right to a jury trial on a factual issue.”

We believe that the Court of Appeals erred. We do not agree with the petitioner’s argument in this Court that the respondent’s evidence was insufficient to withstand the motion to strike the defense and that he is entitled to our judgment reinstating the judgment of the District Court. But the petitioner is entitled to have the question determined in the trial court. This would be necessary even if petitioner offered no proof of his own. Although the respondent’s evidence was sufficient to withstand the motion under the meaning given the *532statute by the Court of Appeals, it presented a fact question, which, in the circumstances of this case to be discussed infra, is properly to be decided by a jury. This is clear not only because of the issue of the credibility of the manager’s vital testimony, but also because, even should the jury resolve that issue as did the Court of Appeals, the jury on the entire record — consistent with the view of the South Carolina cases that this question is in each case largely one of degree and of fact — might reasonably reach an opposite conclusion from the Court of Appeals as to the ultimate fact whether the respondent was a statutory employer.

At all events, the petitioner is plainly entitled to have an opportunity to try the issue under the Court of Appeals’ interpretation. His motion to dismiss the affirmative defense, properly viewed, was analogous to a defendant’s motion for involuntary dismissal of an action after the plaintiff has completed the presentation of his evidence. Under Rule 41 (b) of the Federal Rules of Civil Procedure, in such case “the defendant, without waiving his right to offer evidence in the event the motion is not granted, may move for dismissal on the ground that upon the facts and the law the plaintiff has shown no right to relief.” The respondent argues, however, that before the trial judge ruled on the petitioner’s motion, the petitioner’s counsel, in effect, conceded that he had no other evidence to offer and was submitting the issue of whether the respondent was a statutory employer on the basis of the evidence already in the case. The judge asked petitioner’s counsel: “In the event I overrule your motion, do you contemplate putting up any testimony in reply?” Counsel answered: “We haven’t discussed it, but we are making that motion. I frankly don’t know at this point of any reply that is necessary. I don’t know of any evidence in this case — .” The interruption which prevented counsel’s completion of the answer was the trial judge’s *533comment: “I am inclined to think so far it is a question of law but I will hear from Mr. Walker [respondent’s counsel] on that. I don’t know of any issue of fact to submit to the jury. It seems to me under the testimony here there has been — I don’t know of any conflict in the testimony, so far as that’s concerned, so far.” The judge turned to respondent’s counsel and there followed a long colloquy with him,5 at the conclusion of which the judge dismissed the defense upon the ground that under his interpretation of the statute the defense was not sustained without evidence that the respondent’s business involved the doing of work for others of the kind done by the petitioner’s employer for the respondent. Upon this record it plainly cannot be said that the petitioner submitted the issue upon the evidence in the case and conceded that he had no evidence of his own to offer. The petitioner was fully justified in that circumstance in not coming forward with proof of his own at that stage of the proceedings, for he had nothing to meet under the District Court’s view of the statute. He thus cannot be penalized by the denial of his day in court to try the issue under the correct interpretation of the statute. Cf. Fountain v. Filson, 336 U. S. 681; Weade v. Dichmann, Wright & Pugh, Inc., 337 U. S. 801; Globe Liquor Co. v. San Roman, 332 U. S. 571; Cone v. West Virginia Paper Co., 330 U. S. 212.

II.

A question is also presented as to whether on remand the factual issue is to be decided by the judge or by the jury. The respondent argues on the basis of the decision of the Supreme Court of South Carolina in Adams v. Da-*534vison-Paxon Co., 230 S. C. 532, 96 S. E. 2d 566,6 that the issue of immunity should be decided by the judge and not by the jury. That was a negligence action brought in the state trial court against a store owner by an employee of an independent contractor who operated the store’s millinery department. The trial judge denied the store owner’s motion for a directed verdict made upon the ground that § 72-111 barred the plaintiff’s action. The jury returned a verdict for the plaintiff. The South Carolina Supreme Court reversed, holding that it was for the judge and not the jury to decide on the evidence whether the owner was a statutory employer, and that the store owner had sustained his defense. The court rested its holding on decisions, listed in footnote 8, infra, involving judicial review of the Industrial Commission and said:

“Thus the trial court should have in this case resolved the conflicts in the evidence and determined the fact of whether . . . [the independent contractor] was performing a part of the 'trade, business or occupation’ of the department store-appellant and, therefore, whether . . . [the employee’s] remedy is exclusively under the Workmen’s Compensation Law.” 230 S. C., at 543, 96 S. E. 2d, at 572.

The respondent argues that this state-court decision governs the present diversity case and “divests the jury of its normal function” to decide the disputed fact question of the respondent’s immunity under § 72-111. This is to contend that the federal court is bound under Erie R. Co. v. Tompkins, 304 U. S. 64, to follow the state court’s holding to secure uniform enforcement of the immunity created by the State.7

*535First. It was decided in Erie R. Co. v. Tompkins that the federal courts in diversity cases must respect the definition of state-created rights and obligations by the state courts. We must, therefore, first examine- the rule in Adams v. Davison-Paxon Co. to determine whether it is bound up with these rights and obligations in such a way that its application in the federal court is required. Cities Service Oil Co. v. Dunlap, 308 U. S. 208.

The Workmen’s Compensation Act is administered in South Carolina by its Industrial Commission. The South Carolina courts hold that, on judicial review of actions of the Commission under § 72-111, the question whether the claim of an injured workman is within the Commission’s jurisdiction is a matter of law for decision by the court, which makes its own findings of fact relating to that jurisdiction.8 The South Carolina Supreme Court states no reasons in Adams v. Davison-Paxon Co. why, although the jury decides all other factual issues raised by the cause of action and defenses, the jury is displaced as to the factual issue raised by the affirmative defense under § 72-111. The decisions cited to support the holding are those listed in footnote 8, which are concerned solely with defining the scope and method of judicial review of the Indus*536trial Commission. A State may, of course, distribute the functions of its judicial machinery as it sees fit. The decisions relied upon, however, furnish no reason for selecting the judge rather than the jury to decide this single affirmative defense in the negligence action. They simply reflect a policy, cf. Crowell v. Benson, 285 U. S. 22, that administrative determination of “jurisdictional facts” should not be final but subject to judicial review. The conclusion is inescapable that the Adams holding is grounded in the practical consideration that the question had theretofore come before the South Carolina courts from the Industrial Commission and the courts had become accustomed to deciding the factual issue of immunity without the aid of juries. We find nothing to suggest that this rule was announced as an integral part of the special relationship created by the statute. Thus the requirement appears to be merely a form and mode of enforcing the immunity, Guaranty Trust Co. v. York, 326 U. S. 99, 108, and not a rule intended to be bound up with the definition of the rights and obligations of the parties. The situation is therefore not analogous to that in Dice v. Akron, C. & Y. R. Co., 342 U. S. 359, where this Court held that the right to trial by jury is so substantial a part of the cause of action created by the Federal Employers’ Liability Act that the Ohio courts could not apply, in an action under that statute, the Ohio rule that the question of fraudulent release was for determination by a judge rather than by a jury.

Second. But cases following Erie have evinced a broader policy to the effect that the federal courts should conform as near as may be — in the absence of other considerations — to state rules even of form and mode where the state rules may bear substantially on the question whether the litigation would come out one way in the federal court and another way in the state court if the fed*537eral court failed to apply a particular local rule.9 E. g., Guaranty Trust Co. v. York, supra; Bernhardt v. Polygraphic Co., 350 U. S. 198. Concededly the nature of the tribunal which tries issues may be important in the enforcement of the parcel of rights making up a cause of action or defense, and bear significantly upon achievement of uniform enforcement of the right. It may well be that in the instant personal-injury case the outcome would be substantially affected by whether the issue of immunity is decided by a judge or a jury. Therefore, were “outcome” the only consideration, a strong case might appear for saying that the federal court should follow the state practice.

But there are affirmative countervailing considerations at work here. The federal system is an independent system for administering justice to litigants who properly invoke its jurisdiction. An essential characteristic of that system is the manner in which, in civil common-law actions, it distributes trial functions between judge and jury and, under the influence — if not the command 10 — of the Seventh Amendment, assigns the decisions of disputed questions of fact to the jury. Jacob v. New York, 315 U. S. 752.11 The policy of uniform enforcement of state-created *538rights and obligations, see, e. g., Guaranty Trust Co. v. York, supra, cannot in every case exact compliance with a state rule12 — not bound up with rights and obligations— which disrupts the federal system of allocating functions between judge and jury. Herron v. Southern Pacific Co., 283 U. S. 91. Thus the inquiry here is whether the federal policy favoring jury decisions of disputed fact questions should yield to the state rule in the interest of furthering the objective that the litigation should not come out one way in the federal court and another way in the state court.

We think that in the circumstances of this case the federal court should not follow the state rule. It cannot be gainsaid that there is a strong federal policy against allowing state rules to disrupt the judge-jury relationship in the federal courts. In Herron v. Southern Pacific Co., supra, the trial judge in a personal-injury negligence action brought in the District Court for Arizona on diversity grounds directed a verdict for the defendant when it appeared as a matter of law that the plaintiff was guilty of contributory negligence. The federal judge refused to be bound by a provision of the Arizona Constitution which made the jury the sole arbiter of the ques*539tion of contributory negligence.13 This Court sustained the action of the trial judge, holding that “state laws cannot alter the essential character or function of a federal court” because that function “is not in any sense a local matter, and state statutes which would interfere with the appropriate performance of that function are not binding upon the federal court under either the Conformity Act or the 'rules of decision’ Act.” Id., at 94. Perhaps even more clearly in light of the influence of the Seventh Amendment, the function assigned to the jury “is an essential factor in the process for which the Federal Constitution provides.” Id., at 95. Concededly the Herron case was decided before Erie R. Co. v. Tompkins, but even when Swift v. Tyson, 16 Pet. 1, was governing law and allowed federal courts sitting in diversity cases to disregard state decisional law, it was never thought that state statutes or constitutions were similarly to be disregarded. Green v. Neal’s Lessee, 6 Pet. 291. Yet Herron held that state statutes and constitutional provisions could not disrupt or alter the essential character or function of a federal court.14

Third. We have discussed the problem upon the assumption that the outcome of the litigation may be substantially affected by whether the issue of immunity is decided by a judge or a jury. But clearly there is not present here the certainty that a different result would follow, cf. Guaranty Trust Co. v. York, supra, or even the strong possibility that this would be the case, cf. Bernhardt v. *540Polygraphic Co., supra. There are factors present here which might reduce that possibility. The trial judge in the federal system has powers denied the judges of many States to comment on the weight of evidence and credibility of witnesses, and discretion to grant a new trial if the verdict appears to him to be against the weight of the evidence. We do not think the likelihood of a different result is so strong as to require the federal practice of jury determination of disputed factual issues to yield to the state rule in the interest of uniformity of outcome.15

The Court of Appeals did not consider other grounds of appeal raised by the respondent because, the ground taken disposed of the case. We accordingly remand the case to the Court of Appeals for the decision of the other questions, with instructions that, if not made unnecessary by the decision of such questions, the Court of Appeals shall remand the case to the District Court for a new trial of such issues as the Court of Appeals may direct.

Reversed and remanded.

Mr. Justice Whittaker,

concurring in part and dissenting in part.

In 1936 the South Carolina Legislature passed an Act known as “The South Carolina Workmen’s Compensation Law.” S. C. Code, 1952, Tit. 72. It created a new, complete, detailed and exclusive plan for the compensa*541tion by an “employer” of his “employee” 1 for bodily injuries sustained by the latter which arise “by accident out of and in the course of the employment,” whether with or without fault of the employer. § 72-14. The Act also prescribes the measure and nature of the remedy,2 which “shall exclude all other rights and remedies of such employee . . . against his employer, at common law or otherwise, on account of such injury” (§ 72-121), and vests exclusive jurisdiction in the South Carolina Industrial Commission over all claims falling within the purview of the Act (§ 72-66), subject to review by appeal to the State’s courts upon “errors of law.” § 72-356.

Section 72-111 expands the definition of the terms “employee” and “employer” (note 1) by providing, in substance, that when an “ ‘owner’ ” of premises “undertakes to perform or execute any work which is a part oj his trade, business or occupation and contracts with any other person [called “subcontractor”] for the execution or performance by or under such subcontractor oj the whole or any part oj the work undertaken by such owner, the owner shall be liable to pay to any workman employed in the work any compensation under this Title which he would have been liable to pay ij the workman had been immediately employed by him.” (Emphasis supplied.) Employees of such subcontractors are commonly called “statutory employees” of the “owner.”

Petitioner, a lineman employed by a “subcontractor” who had contracted to build more than 25 miles of new transmission lines and to convert from single-phase to double-phase more than 87 miles of existing transmission lines and to construct two substations and a breaker station for the “owner,” was severely injured by an acci*542dent which arose out of and in the course of that employment. Subsequent to his injury he sought and received the full benefits provided by the South Carolina Workmen's Compensation Law.

Diversity existing, petitioner then brought this common-law suit in a Federal District Court in South Carolina against the "owner,” the respondent here, for damages for his bodily injury, which, he alleged, had resulted from the “owner’s” negligence. The respondent-“owner” answered setting up, among other defenses, the affirmative claim that petitioner’s injury arose by accident out of and in the course of his employment, as a lineman, by the subcontractor while executing the contracted work “which [was] a part of [the owner’s] trade, business or occupation.” It urged, in consequence, that petitioner was its “statutory employee” and that, therefore, his exclusive remedy was under the South Carolina Workmen’s Compensation Law, and that exclusive jurisdiction of the subject matter of his claim was vested in the State’s Industrial Commission and, hence, the federal court lacked jurisdiction over the subject matter of this common-law suit.

At the trial petitioner adduced evidence upon the issue of negligence and rested his case in chief. Thereupon respondent, in support of its affirmative defense, adduced evidence tending to show (1) that its charter, issued under the Rural Electric Cooperative Act of South Carolina (S. C. Code, 1952, § 12-1025), authorized it to construct and operate electric generating plants and transmission lines essential to its business of generating and distributing electricity; (2) that it had (before the Second World War) constructed substations with its own direct employees and facilities, although the six substations which it was operating at the time petitioner was injured had been built by contractors, and that when *543petitioner was injured it did not have in its direct employ any person capable of constructing a substation;3 (3) that it regularly employed a crew of 16 men — 8 linemen and 8 groundmen — two-thirds of whose time was spent in constructing new transmission lines and extensions, and that such was “a part of [its] trade, business [and] occupation.” This evidence stood undisputed when respondent rested its case.

At the close of respondent’s evidence petitioner moved to strike respondent’s affirmative jurisdictional defense, and all evidence adduced in support of it. Respondent made known to the court that when petitioner had rested it wished to move for a directed verdict in its favor. Thereupon the colloquy between the court and counsel, which is set forth in substance in Mr. Justice Frankfurter’s dissenting opinion, occurred. The District Court sustained petitioner’s motion and struck respondent’s affirmative jurisdictional defense and its supporting evidence from the record. His declared basis for that action was that the phrase in § 72-111 “a part of his trade, business or occupation” related only to work being performed by the “owner” “for somebody else.” There*544after, the district judge heard arguments upon and overruled respondent's motion for a directed verdict,4 and submitted the case to the jury which returned a verdict for petitioner.

On appeal, the Court of Appeals found that the district judge’s construction of § 72-111 was not supportable under controlling South Carolina decisions. It further found that respondent’s evidence disclosed that respondent “was not only in the business of supplying electricity to rural communities, but [was] also in the business of constructing the lines and substations necessary for the distribution of the product,” and that the contracted work was of like nature and, hence, was “a part of [respondent’s] trade, business or occupation,” within the meaning of § 72-111, and, therefore, petitioner was respondent’s statutory employee, and, hence, the court was without jurisdiction over the subject matter of the claim. Upon this basis, it reversed the judgment of the District Court with directions to enter judgment for respondent. 238 F. 2d 346.

This Court now vacates the judgment of the Court of Appeals and remands the case to it for decision of questions not reached in its prior opinion, with directions, if not made unnecessary by its decision of such questions, to remand the case to the District Court for a new trial upon such issues as the Court of Appeals may direct.

I agree with and join in that much of the Court’s opinion. I do so because — although, as found by the *545Court of Appeals, respondent’s evidence was ample, prima facie, to sustain its affirmative jurisdictional defense— petitioner had not waived his right to adduce evidence in rebuttal upon that issue, in other words had not “rested,” at the time the district judge erroneously struck respondent’s jurisdictional defense and supporting evidence from the record. In these circumstances, I believe that the judgment of the Court of Appeals, insofar as it directed the District Court to enter judgment for respondent, would deprive petitioner of his legal right, which he had not waived, to adduce evidence which he claims to have and desires to offer in rebuttal of respondent’s prima facie established jurisdictional defense. The procedural situation then existing was not legally different from a case in which a defendant, without resting, moves, at the close of the plaintiff’s case, for a directed verdict in its favor which the court erroneously sustains, and, on appeal, is reversed for that error. It could not fairly be contended, in those circumstances, that the appellate court might properly direct the trial court to enter judgment for the plaintiff and thus deprive the defendant, who had not rested, of his right to offer evidence in defense of plaintiff’s case. Rule 50, Fed. Rules Civ. Proc. It is urged by respondent that, from the colloquy between the district judge and counsel, which, as stated, is set forth in substance in Mr. Justice Frankfurter’s dissenting opinion, it appears that petitioner had “rested,” and thus had waived his right to adduce rebuttal evidence upon the issue of respondent’s jurisdictional defense, before the district judge sustained his motion to strike that defense and the supporting evidence. But my analysis of the record convinces me that petitioner, in fact, never did so. For this reason I believe that so much of the judgment of the Court of Appeals as directed the District Court to enter judgment for respondent deprives petitioner of his right to adduce rebuttal evidence upon the *546issue of respondent’s prima facie established jurisdictional defense, and, therefore, cannot stand.

But the Court’s opinion proceeds to discuss and determine the question whether, upon remand to the District Court, if such becomes necessary, the jurisdictional issue is to be determined by the judge or by the jury — a question which, to my mind, is premature, not now properly before us, and is one we need not and should not now reach for or decide. The Court, although premising its conclusion “upon the assumption that the outcome of the litigation may be substantially affected by whether the issue of immunity5 is decided by a judge or a jury,” holds that the issue is to be determined by a jury — not by the judge. I cannot agree to this conclusion for the following reasons.

As earlier shown, the South Carolina Workmen’s Compensation Law creates a new, complete, detailed and exclusive bundle of rights respecting the compensation by an “employer” of his “employee” for bodily injuries sustained by the latter which arise by accident out of and in the course of the employment, regardless of fault, and vests exclusive jurisdiction in the State’s Industrial Commission over all such claims, subject to review by appeal in the South Carolina courts only upon “errors of law.” Consonant with § 72-66, which vests exclusive jurisdiction over such claims in the Commission, and with § 72-356, which allows judicial review only upon “errors of law,” the Supreme Court of the State has uniformly held that the question, in cases like the present, whether *547jurisdiction over such claims is vested in the Industrial Commission or in the courts presents a question of law for determination by the court, not a jury. In Adams v. Davison-Paxon Co., 230 S. C. 532, 96 S. E. 2d 566 (1957), which appears to be the last case by the Supreme Court of the State on the question, plaintiff, an employee of a concessionaire operating the millinery department in defendant’s store, was injured, she claimed by negligence, while using a stairway in the store. She brought a common-law suit for damages against the owner of the store. The latter defended upon the ground, among others, that the operation of the millinery department, though under a contract with the concessionaire, plaintiff’s employer, was “a part of [its] trade, business or occupation,” that the plaintiff was therefore its statutory employee under § 72-111 and exclusive jurisdiction over the subject matter of plaintiff’s claim was vested in the Industrial Commission, and that the court was without jurisdiction over the subject matter in her common-law suit. It seems that the trial court submitted this issue, along with others, to the jury which returned a verdict for plaintiff. On appeal the Supreme Court of the State reversed, saying:

“It has been consistently held that whether the claim of an injured workman is within the jurisdiction of the Industrial Commission is a matter of law for decision by the Court, which includes the finding of the facts which relate to jurisdiction. Knight v. Shepherd, 191 S. C. 452, 4 S. E. (2d) 906; Tedars v. Savannah River Veneer Company, 202 S. C. 363, 25 S. E. (2d), 235, 147 A. L. R. 914; McDowell v. Stilley Plywood Co., 210 S. C. 173, 41 S. E. (2d) 872; Miles v. West Virginia Pulp & Paper Co., 212 S. C. 424, 48 S. E. (2d) 26; Watson v. Wannamaker & Wells, Inc., 212 S. C. 506, 48 S. E. (2d) 447; Gordon v. Hollywood-Beaufort Package Corp., 213 S. C. 438, *54849 S. E. (2d) 718; Holland v. Georgia Hardwood Lbr. Co., 214 S. C. 195, 51 S. E. (2d) 744; Younginer v. J. A. Jones Const. Co., 215 S. C. 135, 54 S. E. (2d) 545; Horton v. Baruch, 217 S. C. 48, 59 S. E. (2d) 545.

“Thus the trial court should have in this case resolved the conflicts in the evidence and determined the fact of whether Emporium [the concessionaire] was performing a part of the ‘trade, business or occupation’ of the department store-appellant and, therefore, whether respondent’s remedy is exclusively under the Workmen’s Compensation Law.” 230 S. C., at 543, 96 S. E. 2d, at 571. (Emphasis supplied.)

It thus seems to be settled under the South Carolina Workmen’s Compensation Law, and the decisions of the highest court of that State construing it, that the question whether exclusive jurisdiction, in cases like this, is vested in its Industrial Commission or in its courts of general jurisdiction is one for decision by the court, not by a jury. The Federal District Court, in this diversity case, is bound to follow the substantive South Carolina law that would be applied if the trial were to be held in a South Carolina court, in which State the Federal District Court sits. Erie R. Co. v. Tompkins, 304 U. S. 64. A Federal District Court sitting in South Carolina may not legally reach a substantially different result than would have been reached upon a trial of the same case “in a State court a block away.” Guaranty Trust Co. v. York, 326 U. S. 99, 109.

The Court’s opinion states: “Concededly the nature of the tribunal which tries issues may be important in the enforcement of the parcel of rights making up a cause of action or defense, and bear significantly upon achievement of uniform enforcement of the right. It may well be that in the instant personal-injury case the outcome *549would be substantially affected by whether the issue of immunity is decided by a judge or a jury.” And the Court premises its conclusion “upon the assumption that the outcome of the litigation may be substantially affected by whether the issue of immunity is decided by a judge or a jury.” Upon that premise, the Court’s conclusion, to my mind, is contrary to our cases. “Here [as in Guaranty Trust Co. v. York, supra] we are dealing with a right to recover derived not from the United States but from one of the States. When, because the plaintiff happens to be a non-resident, such a right is enforceable in a federal as well as in a State court, the forms and mode of enforcing the right may at times, naturally enough, vary because the two judicial systems are not identic. But since a federal court adjudicating a State-created right solely because of the diversity of citizenship of the parties is for that purpose, in effect, only another court of the State, it cannot afford recovery if the right to recover is made unavailable by the State nor can it substantially affect the enforcement of the right as given by the State.” Guaranty Trust Co. v. York, supra, at 108-109. (Emphasis supplied.)

The words “substantive” and “procedural” are mere conceptual labels and in no sense talismanic. To call a legal question by one or the other of those terms does not resolve the question otherwise than as a purely authoritarian performance. When a question though denominated “procedural” is nevertheless so “substantive” as materially to affect the result of a trial, federal courts, in enforcing state-created rights, are not free to disregard it, on the ground that it is “procedural,” for such would be to allow, upon mere nomenclature, a different result in a state court from that allowable in a federal court though both are, in effect, courts of the State and “sitting side by side.” Klaxon Co. v. Stentor Co., 313 U. S. 487, 496. “The federal court enforces the state-created right *550by rules of procedure which it has acquired from the Federal Government and which therefore are not identical with those of the state courts. Yet, in spite of that difference in procedure, the federal court enforcing a state-created right in a diversity case is, as we said in Guaranty Trust Co. v. York, 326 U. S. 99, 108, in substance 'only another court of the State.’ The federal court therefore may not ‘substantially affect the enforcement of the right as given by the State.’ Id., 109.” Bernhardt v. Polygraphic Co., 350 U. S. 198, 202-203. (Emphasis supplied.) “Where local law qualifies or abridges [the right], the federal court must follow suit. Otherwise there is a different measure of the cause of action in one court than in the other, and the principle of Erie R. Co. v. Tompkins is transgressed.” Ragan v. Merchants Transfer Co., 337 U. S. 530, 533. “It is therefore immaterial whether [state-created rights] are characterized either as ‘substantive’ or ‘procedural’ in State court opinions in any use of those terms unrelated to the specific issue before us. Erie R. Co. v. Tompkins was not an endeavor to formulate scientific legal terminology. It expressed a policy that touches vitally the proper distribution of judicial power between State and federal courts. In essence, the intent of that decision was to insure that, in all cases where a federal court is exercising jurisdiction solely because of the diversity of citizenship of the parties, the outcome of the litigation in the federal court should be substantially the same, so far as legal rules determine the outcome of a litigation, as it would be if tried in a State court. The nub of the policy that underlies Erie R. Co. v. Tompkins is that for the same transaction the accident of a suit by a non-resident litigant in a federal court instead of in a State court a block away should not lead to a substantially different result. And so, putting to one side abstractions regarding ‘substance’ and ‘procedure,’ we have held that in diversity cases the federal *551courts must follow the law of the State . . . Guaranty Trust Go. v. York, supra, at 109. (Emphasis supplied.)

Inasmuch as the law of South Carolina, as construed by its highest court, requires its courts — not juries — to determine whether jurisdiction over the subject matter of cases like this is vested in its Industrial Commission, and inasmuch as the Court’s opinion concedes “that in the. instant personal-injury case the outcome would be substantially affected by whether the issue of immunity is decided by a judge or a jury,” it follows that in this diversity case the jurisdictional issue must be determined by the judge — not by the jury. Insofar as the Court holds that the question of jurisdiction should be determined by the jury, I think the Court departs from its 'past decisions. I therefore respectfully dissent from part II of the opinion of the Court.

Mr. Justice Frankfurter,

whom

This is a suit for common-law negligence, brought in a United States District Court in South Carolina because of diversity of citizenship, 28 U. S. C. § 1332. Respondent is a cooperative, organized and operating under the South Carolina Rural Electric Cooperative Act, S. C. Code, 1952, § 12-1001 et seq., engaged in distributing electric power to its members, and extending the availability of power to new users, in rural areas of the State. Incident to the expansion of its facilities and services, it had made a contract with R. H. Bouligny, Inc., whereby the latter was to construct 24.19 miles of new power lines, to rehabilitate and convert to higher capacity 87.69 miles of existing lines, and to construct two substations and a breaker station. In the execution of this contract, petitioner, a citizen of North Carolina, and a lineman for Bouligny, was seriously burned when he attempted to make a connection between the equipment in one of the *552new substations and an outside line through which, by a mistake on the part of another of Bouligny’s employees, current was running. Petitioner filed a claim against Bouligny pursuant to the South Carolina Workmen’s Compensation Law, S. C. Code, 1952, § 72-1 et seq., under which both Bouligny and respondent operated, and recovered the full benefits under the Law. He then brought this suit.

Respondent defended on the ground, among others, that, since petitioner was injured in the execution of his true employer’s (Bouligny’s) contract with respondent to perform a part of its “trade, business or occupation,” respondent was petitioner’s “statutory employer” and therefore liable to petitioner under § 72-111 of the State’s Workmen’s Compensation Law.1 It would follow from this that petitioner, by virtue of his election to proceed against Bouligny, was barred from proceeding against respondent, either under the statute or at common law (§§ 72-121, 72-123).2 After all the evidence was in, the *553court granted petitioner’s motion to strike the defense, on the ground that an activity could not be a part of a firm’s “trade, business or occupation” unless it was being performed “for somebody else.” The court also denied respondent’s motion for a directed verdict and submitted the case to the jury, which returned a verdict for petitioner in the amount of $126,786.80.

On appeal, the United States Court of Appeals for the Pourth Circuit found the District Court’s construction of § 72-111 unsupportable under controlling South Carolina decisions.3 In concluding that respondent had sustained its defense, the appellate court cited the following evidence elicited at trial. Respondent employed a sixteen-man “outside crew,” two-thirds of whose time was spent in such construction work as building new power lines and extensions; since World War II the demand for electrical service had been so great that independent con-tractors had to be employed to do much of the necessary construction work. All of respondent’s construction work, regardless of who was actually performing it, was done under the supervision of an engineering firm with which respondent has an engineering service contract. Testimony as to the construction of substations was not altogether consistent; however, stated most favorably to petitioner — and that is the light in which the Court of Appeals considered it — that evidence was to the effect *554that respondent had with its own facilities constructed three substations, although it had built none of the six it was operating at the time petitioner was injured, nor was respondent at that time employing personnel capable of constructing substations. The construction work in connection with which petitioner was injured was clearly among the functions respondent was empowered to perform by the statute under which it was organized; moreover, this construction was necessary to the discharge of respondent’s duty to serve the area in which it operated. Finally, respondent was the “main actor” in this particular construction project: it secured the necessary financing; its consulting engineer prepared the plans (approved by respondent) and supervised the construction ; it purchased the materials of which the substations were constructed; it had the responsibility of de-energiz-ing and re-energizing existing lines that were involved in the work. From this evidence the Court of Appeals was satisfied that “there can be no doubt that Blue Ridge was not only in the business of supplying electricity to rural communities, but also in the business of constructing the lines and substations necessary for the distribution of the product,” 238 F. 2d 346, 351. The Court of Appeals, having concluded that respondent's defense should have been sustained, directed the District Court to enter judgment for the respondent. The District Court had decided the question of whether or not respondent was a statutory employer without submitting it to the jury. It is not altogether clear whether it did so because it thought it essentially a nonjury issue, as it is in the South Carolina courts under Adams v. Davison-Paxon Co., 230 S. C. 532, 96 S. E. 2d 566, or because there was no controverted question of fact to submit to the jury.

The construction of the state law by the Court of Appeals is clearly supported by the decisions of the Supreme Court of South Carolina, and so we need not rest on the *555usual respect to be accorded to a reading of a local statute by a Federal Court of Appeals. Estate of Spiegel v. Commissioner, 335 U. S. 701, 708. It is clear from the state cases that a determination as to whether a defendant is an “employer” for purposes of § 72-111 will depend upon the entire circumstances of the relationship between such defendant and the work being done on its behalf; no single factor is determinative. Both the approach of the Court of Appeals and the conclusions that it reached from the evidence in this case are entirely consistent with prior declarations of South Carolina law by the highest court of that State.4

In holding respondent a statutory employer, the Court of Appeals was giving the South Carolina Workmen’s Compensation Law the liberal construction called for by the Supreme Court of that State. In Yeomans v. Anheuser-Busch, Inc., 198 S. C. 65, 72, 15 S. E. 2d 833, 835, that court said:

“[T]he basic purpose of the Compensation Act is the inclusion of employers and employees, and not their exclusion; and we add that doubts of jurisdiction must be resolved in favor of inclusion rather than exclusion.”

It would be short-sighted to overlook the fact that exclusion of an employer in a specific case such as this one *556might well have the consequence of denying any recovery at all to other employees vis-á-vis this employer and others similarly situated. The Court of Appeals, through the experienced Judge Soper, recognized the short-sighted illiberality of yielding to the temptation of allowing a single recovery for negligence to stand and do violence to the consistent and legislatively intended interpretation of the statute in Berry v. Atlantic Greyhound Lines, 114 F. 2d 255, 257:

“It may well be, and possibly this is true in the instant case, that sometimes a recovery might be had in a common law action for an amount much larger than the amount which would be received under a Compensation Act. This, though, is more than balanced by the many advantages accorded to an injured employee in a proceeding under a Compensation Act which would not be found in a common law action.”

When, after the evidence was in, petitioner moved to strike respondent’s defense based on § 72-111, the following colloquy ensued:

“The Court: In the event I overrule your motion, do you contemplate putting up any testimony in reply? You have that right, of course. On this point, I mean.

“Mr. Hammer [petitioner’s counsel]: We haven’t discussed it, but we are making that motion. I frankly don’t know at this point of any reply that is necessary. I don’t know of any evidence in this case—

“The Court: The reason I am making that inquiry as to whether you intend to put up any more testimony in the event I overrule your motion, counsel *557may wish to move for a directed verdict on that ground since it is a question of law. But that is his prerogative after all the evidence is in. Of course, he caiji't move for a directed verdict as long as you have a right to reply.

“Mr. Hammer: We are moving at this time in the nature of a voluntary dismissal.

“'I’he Court: You move to dismiss that defense?

“Mr. Hammer: Yes, sir, at this stage of the game.”

After argument by counsel, the court made its ruling, granting petitioner’s motion. Respondent having indicated its intention to move for a directed verdict, the court then said, “I will allow you to include in that Motion for Directed Verdict your defense which I have stricken, if you desire. . . .” Respondent’s motion was overruled.

It is apparent that petitioner had no intention of introducing any evidence on the issue of whether respondent was his statutory employer and that he was prepared to — and did — submit the issue to the court on that basis. Clearly petitioner cannot be said to have relied upon, and thus to have been misled by, the court’s erroneous construction of the law, for it was before the court had disclosed its view of the law that petitioner made apparent his willingness to submit the issue to it on the basis of respondent’s evidence. If petitioner could have cast any doubt on that evidence or could have brought in any other matter relevant to the issue, it was his duty to bring it forward before the issue was submitted to the court. For counsel to withhold evidence on an issue submitted for decision until after that issue has been resolved against him would be an abuse of the judicial process that this Court surely should not countenance, however strong the philanthropic appeal in a particular case. Nor does *558it appear that petitioner had any such “game” in mind. He gave not the slightest indication of an intention to introduce any additional evidence, no matter how the court might decide the issue. It seems equally clear that, had the trial court decided the issue — on any construction — in favor of the respondent, the petitioner was prepared to rely solely upon his right of appeal.

We are not to read the record as though we are making an independent examination of the trial proceedings. We are sitting in judgment on the Court of Appeals’ review of the record. That court, including Chief Judge Parker and Judge Soper, two of the most experienced and esteemed circuit judges in the federal judiciary, interpreted the record as it did in light of its knowledge of local practice and of the ways of local lawyers. In ordering judgment entered for respondent, it necessarily concluded, as a result of its critical examination of the record, that petitioner’s counsel chose to have the issue decided on the basis of the record as it then stood. The determination of the Court of Appeals can properly be reversed only if it is found that it was baseless. Even granting that the record is susceptible of two interpretations, it is to disregard the relationship of this Court to the Courts of Appeals, especially as to their function in appeals in diversity cases, to substitute our view for theirs.

The order of the Court of Appeals that the District Court enter judgment for the respondent is amply sustained on either theory as to whether or not the issue was one for the court to decide. If the question is for the court, the Court of Appeals has satisfactorily resolved it in accordance with state decisions. And if, on the other hand, the issue is such that it would have to be submitted to the jury if there were any crucial facts in controversy, both the District Court and the Court of Appeals agreed that there was no conflict as to the rele*559vant evidence — not, at any rate, if such inconsistency as existed was resolved in favor of petitioner. According to the governing view of South Carolina law, as given us by the Court of Appeals, that evidence would clearly have required the District Court to grant a directed verdict to the respondent. Accordingly, I would affirm the judgment.

Mr. Justice Harlan,

dissenting.

I join in Mr. Justice Frankfurter's dissenting opinion, but desire to add two further reasons why I believe the judgment of the Court of Appeals should be affirmed. As I read that court’s opinion, it held that under South Carolina law the construction of facilities needed to transmit electric power was necessarily a part of the business of furnishing power, whether such construction was performed by the respondent itself or let out to others, and that in either case respondent would be liable to petitioner for compensation as his statutory employer. Since there is no dispute that respondent at the time of the accident was engaged in the business of furnishing power and that petitioner was injured while engaged in construction in furtherance of that business, I do not perceive how any further evidence which might be adduced by petitioner could change the result reached by the Court of Appeals. In any event, in the circumstances disclosed by the record before us, we should at the very least require petitioner to make some showing here of the character of the further evidence he expects to introduce before we disturb the judgment below.

*461Mr. Chief Justice Warren

delivered the opinion of the Court.

The question to be decided is whether, in a civil action where the jurisdiction of the United States district court is based upon diversity of citizenship between the parties, service of process shall be made in the manner prescribed by state law or that set forth in Rule 4 (d)(1)- of the Federal Rules of Civil Procedure.

On February 6, 1963, petitioner, a citizen of Ohio, filed her complaint in the District Court for the District of Massachusetts, claiming damages in excess of $10,000 for personal injuries resulting from an automobile accident in South Carolina, allegedly caused by the negligence of one Louise Plumer Osgood, a Massachusetts citizen deceased at the time of the filing of the complaint. Respondent, Mrs. Osgood’s executor and also a Massachusetts citizen, was named as defendant. On February 8, service was made by leaving copies of the summons and the complaint with respondent’s wife at his residence, concededly in compliance with Rule 4(d)(1), which provides:

“The summons and complaint shall be served together. The plaintiff shall furnish' the person making service with such copies as are necessary. Service shall be made as follows:

“(1) Upon an individual other than an infant or an incompetent person, by delivering a copy of the summons and of the complaint to him personally or by leaving copies thereof at his dwelling house or usual place of abode with some person of suitable age and discretion then residing therein . . . .”

Respondent filed his answer on February 26, alleging, inter alia, that the action could not be maintained because it had been brought “contrary to and in violation of the *462provisions of Massachusetts General Laws (Ter. Ed.) Chapter 197, Section 9.” That section provides:

“Except as provided in this chapter, an executor or administrator shall not be held to answer to an action by a creditor of the deceased which is not commenced within one year from the time of his giving bond for the performance of his trust, or to such an action, which is commenced within said year unless before the expiration thereof the writ in such action has been served by delivery in hand upon such executor or administrator or service thereof accepted by him or a notice stating the name of the estate, the name and address of the creditor, the amount of the claim and the court in which the action has been brought has been filed in the proper registry of probate. . . Mass. Gen. Laws Ann., c. 197, § 9 (1958).

On October 17, 1963, the District Court granted respondent's motion for summary judgment, citing Ragan v. Merchants Transfer Co., 337 U. S. 530, and Guaranty Trust Co. v. York, 326 U. S. 99, in support of its conclusion that the adequacy of the service was to be measured by § 9, with which, the court held, petitioner had not complied. On appeal, petitioner admitted noncompliance with § 9, but argued that Rule 4(d)(1) defines the method by which service of process is to be effected in - diversity actions. The Court of Appeals for the First Circuit, finding that “[relatively recent amendments [to § 9] evince a clear legislative purpose to require personal notification within the year,” 1 concluded that the conflict of state *463and federal rules was over “a substantive rather than a procedural matter,” and unanimously affirmed. 331 F. 2d 157. Because of the threat to the goal of uniformity of federal procedure posed by the decision below,2 we granted certiorari, 379 U. S. 813.

We conclude that the adoption of Rule 4 (d)(1), designed to control service of process in diversity actions,3 *464neither exceeded the congressional mandate embodied in the Rules Enabling Act nor transgressed constitutional bounds, and that the Rule is therefore the standard against which the District Court should have measured the adequacy of the service. Accordingly, we reverse the decision of the Court of Appeals.

The Rules Enabling Act, 28 U. S. C. § 2072 (1958 ed.), provides, in pertinent part:

“The Supreme Court shall have the power to prescribe, by general rules, the forms of process, writs, pleadings, and motions, and the practice and procedure of the district courts of the United States in civil actions.

“S.uch rules shall not abridge, enlarge or modify any substantive right and shall preserve the right of trial by jury

Under the cases construing the scope of the Enabling Act, Rule 4(d)(1) clearly passes muster. Prescribing the manner in which a defendant is to be notified that a suit has been instituted against him, it relates to the “practice and procedure of the district courts.” Cf. Insurance Co. v. Bangs, 103 U. S. 435, 439.

“The test must be whether a rule really regulates procedure, — the judicial process for enforcing rights and duties recognized by substantive law and for justly administering remedy and redress for disregard or infraction of them.” Sibbach v. Wilson & Co., 312 U. S. 1, 14.4

In Mississippi Pub. Corp. v. Murphree, 326 U. S. 438, this Court upheld Rule 4 (f), which permits service of a summons anywhere within the State (and not merely the district) in which a district court sits:

“We think that Rule 4 (f) is in harmony with the Enabling Act .... Undoubtedly most alterations *465of the rules of practice and procedure may and often do affect the rights of litigants. Congress’ prohibition of any alteration of substantive rights of litigants was obviously not addressed to such incidental effects as necessarily attend the adoption of the prescribed new rules of procedure upon the rights of litigants who, agreeably to rules of practice and procedure, have been brought before a court authorized to determine their rights. Sibbach v. Wilson & Co., 312 U. S. 1, 11-14. The fact that the application of Rule 4 (f) will operate to subject petitioner’s rights to adjudication by the district court for northern Mississippi will undoubtedly affect those rights. But it does not operate to abridge, enlarge or modify the rules of decision by which that court will adjudicate its rights.” Id., at 445-446.

Thus were there no conflicting state procedure, Rule 4(d)(1) would clearly control. National Rental v. Szukhent, 375 U. S. 311, 316. However, respondent, focusing on the contrary Massachusetts rule, calls to the Court’s attention another line of cases, a line which — like the Federal Rules — had its birth in 1938. Erie R. Co. v. Tompkins, 304 U. S. 64, overruling Swift v. Tyson, 16 Pet. 1, held that federal courts sitting in diversity cases, when deciding questions of “substantive” law, are bound by state court decisions as well as state statutes. The broad command of Erie was therefore identical to that of the Enabling Act: federal courts are to apply state substantive law and federal procedural law. However, as subsequent cases sharpened the distinction between substance and procedure, the line of cases following Erie diverged markedly from the line construing the Enabling Act. Guaranty Trust Co. v. York, 326 U. S. 99, made it clear that Erie-type problems were not to be solved by *466reference to any traditional or common-sense substance-procedure distinction:

"And so the question is not whether a statute of limitations is deemed a matter of 'procedure’ in some sense. The question is . . . does it significantly affect the result of a litigation for a federal court to disregard a law of a State that would be controlling in an action upon the same claim by the same parties in a State court?” 326 U. S., at 109.5

Respondent, by placing primary reliance on York and Ragan, suggests that the Erie doctrine acts as a check on the Federal Rules of Civil Procedure, that despite the clear command of Rule 4 (d)(1), Erie and its progeny demand the application of the Massachusetts rule. Reduced to essentials, the argument is: (1) Erie, as refined in York, demands that federal courts apply state law whenever application of federal law in its stead will alter the outcome of the case. (2) In this case, a determination that the Massachusetts service requirements obtain will result in immediate victory for respondent. If, on the other hand, it should be held that Rule 4(d)(1) is applicable, the litigation will continue, with possible victory for petitioner. (3) Therefore, Erie demands application of the Massachusetts rule. The syllogism possesses an appealing simplicity, but is for several reasons invalid.

In the first place, it is doubtful that, even if there were no Federal Rule making it clear that in-hand service is not required in diversity actions, the Erie rule would have obligated the District Court to follow the Massachusetts procedure. “Outcome-determination” analysis was never *467intended to serve as a talisman. Byrd v. Blue Ridge Cooperative, 356 U. S. 525, 537. Indeed, the message of York itself is that choices between state and federal law are to be made not by application of any automatic, “litmus paper” criterion, but rather by reference to the policies underlying the Erie rule. Guaranty Trust Co. v. York, supra, at 108-112.6

The Erie rule is rooted in part in a realization that it would be unfair for the character or result of a litigation materially to differ because the suit had .been brought in a federal court.

“Diversity of citizenship jurisdiction was conferred in order to prevent apprehended discrimination in state courts against those not citizens of the State. Swift v. Tyson introduced grave discrimination by non-citizens against citizens. It made rights enjoyed under the unwritten 'general law’ vary according to whether enforcement was sought in the state or in the federal court; and the privilege of selecting the court in which the right should be determined was conferred upon the non-citizen. Thus, the doctrine rendered impossible equal protection of the law.” Erie R. Co. v. Tompkins, supra, at 74-75.7

The decision was also in part a reaction to the practice of “forum-shopping” which had grown up in response to the rule of Swift v. Tyson. 304 U. S., at 73-74.8 That the York test was an attempt to effectuate these policies is demonstrated by the fact that the opinion framed the inquiry in terms of “substantial” variations between state *468and federal litigation. 326 U. S., at 109. Not only are nonsubstantial, or trivial, variations not likely to raise the sort of equal protection problems which troubled the Court in Erie; they are also unlikely to influence the choice of a forum. The “outcome-determination” test therefore cannot be read without reference to the twin aims of the Erie rule: discouragement of forum-shopping and avoidance of inequitable administration of the laws.9

The difference between the conclusion that the Massachusetts rule is applicable, and the conclusion that it is not, is of course at this point “outcome-determinative” in the sense that if we hold the state rule to apply, respondent prevails, whereas if we hold that Rule 4(d)(1) governs, the litigation will continue. But in this sense every procedural variation is “outcome-determinative.” For example, having brought suit in a federal court, a plaintiff cannot then insist on the right to *469file subsequent pleadings in accord with the time limits applicable in the state courts, even though enforcement of the federal timetable will, if he continues to insist that he must meet only the state time limit, result in determination of the controversy against him. So it is here. Though choice of the federal or state rule will at this point have a marked effect upon the outcome of the litigation, the difference between the two rules would be of scant, if any, relevance to the choice of a forum. Petitioner, in choosing her forum, was not presented with a situation where application of the state rule would wholly bar recovery;10 rather, adherence to the state rule would have resulted only in altering the way in which process was served.11 Moreover, it is difficult to argue that permitting service of defendant’s wife to take the place of in-hand service of defendant himself alters the mode of enforcement of state-created rights in a fashion sufficiently “substantial” to raise the sort of equal protection problems to which the Eñe opinion alluded.

There is, however, a more fundamental flaw in respondent’s syllogism: the incorrect assumption that the rule of Erie R. Co. v. Tompkins constitutes the appropriate test *470of the validity and therefore the applicability of a Federal Rule of Civil Procedure. The Erie rule has never been invoked to void a Federal Rule. It is true that there have been cases where this Court has held applicable a state rule in the face of an argument that the situation was governed by one of the Federal Rules. But the holding of each such case was not that Erie commanded displacement of a Federal Rule by an inconsistent state rule, but rather that the scope of the Federal Rule was not as broad as the losing party urged, and therefore, there being no Federal Rule which covered the point in dispute, Erie commanded the enforcement of state law.

“Respondent contends, in the first place, that the charge was correct because of the fact that Rule 8 (c) of the Rules of Civil Procedure makes contributory negligence an affirmative defense. We do not agree. Rule 8 (c) covers only the manner of pleading. The question of the burden of establishing contributory negligence is a question of local law which federal courts in diversity of citizenship cases (Erie R. Co. v. Tompkins, 304 U. S. 64) must apply.” Palmer v. Hoffman, 318 U. S. 109, 117.12

(Here, of course, the clash is unavoidable; Rule 4 (d)(1) says — implicitly, but with unmistakable clarity — that in-hand service is not required in federal courts.) At the same time, in cases adjudicating the validity of Federal Rules, we have not applied the York rule or other refinements of Erie, but have to this day continued to decide questions concerning the scope of the Enabling Act and the constitutionality of specific Federal Rules in light of *471the distinction set forth in Sibbach. E. g., Schlagenhauf v. Holder, 379 U. S. 104.

Nor has the development of two separate lines of cases been inadvertent. The line between “substance” and “procedure” shifts as the legal context changes. “Each implies different variables depending upon the particular problem for which it is used.” Guaranty Trust Co. v. York, supra, at 108; Cook, The Logical and Legal Bases of the Conflict of Laws, pp. 154-183 (1942). It is true that both the Enabling Act and the Erie rule say, roughly, that federal courts are to apply state “substantive” law and federal “procedural” law, but from that it need not follow that the tests are identical. For they were designed to control very different sorts of decisions. When a situation is covered by one of the Federal Rules, the question facing the court is a far cry from the typical, relatively unguided Erie choice: the court has been instructed to apply the Federal Rule, and can refuse to do so only if the Advisory Committee, this Court, and Congress erred in their prima facie judgment that the Rule in question transgresses neither the terms of the Enabling Act nor constitutional restrictions.13

We are reminded by the Erie opinion14 that neither Congress nor the federal courts can, under the guise of formulating rules of decision for federal courts, fashion rules which are not supported by a grant of federal authority contained in Article I or some other section of the- Constitution; in such areas state law must govern *472because there can be no other law. But the opinion in Erie, which involved no Federal Rule and dealt with a question which was “substantive” in every traditional sense (whether the railroad owed a duty of care to Tompkins as a trespasser or a licensee), surely neither said nor implied that measures like Rule 4 (d)(1) are unconstitutional. For the constitutional provision for a federal court system (augmented by the Necessary and Proper Clause) carries with it congressional power to make rules governing the practice and pleading in those courts, which in turn includes a power to regulate matters which, though falling within the uncertain area between substance and procedure, are rationally capable of classification as either. Cf. M‘Culloch v. Maryland, 4 Wheat. 316, 421. Neither York nor the cases following it ever suggested that the rule there laid down for coping with situations where no Federal Rule applies is coextensive with the limitation on Congress to which Erie had adverted. Although this Court has never before been confronted with a case where the applicable Federal Rule is in direct collision with the law of the relevant State,15 courts of appeals faced with such clashes have rightly discerned the implications of our decisions.

“One of the shaping purposes of the Federal Rules is to bring about uniformity in the federal courts by getting away from local rules. This is especially true of matters which relate to the administration of legal proceedings, an area in which federal courts *473have traditionally exerted strong inherent power, completely aside from the powers Congress expressly conferred in the Rules. The purpose of the Erie doctrine, even as extended in York and Ragan, was never to bottle up federal courts with ‘outcome-determinative’ and ‘integral-relations’ stoppers— when there are ‘affirmative countervailing [federal] considerations’ and when there is a Congressional mandate (the Rules) supported by constitutional authority.” Lumbermen’s Mutual Casualty Co. v. Wright, 322 F. 2d 759, 764 (C. A. 5th Cir. 1963).16

Erie and its offspring cast no doubt on the long-recognized power of Congress to prescribe housekeeping rules for federal courts even though some of those rules will inevitably differ from comparable state rules. Cf. Herron v. Southern Pacific Co., 283 U. S. 91. “When, because the plaintiff happens to be a non-resident, such a right is enforceable in a federal as well as- in a State court, the forms and mode of enforcing the right may at times, naturally enough, vary because the two judicial systems are not identic.” Guaranty Trust Co. v. York, supra, at 108; Cohen v. Beneficial Loan Corp., 337 U. S. 541, 555. Thus, though a court, in measuring a Federal Rule against the standards contained in the Enabling Act and the Constitution, need not wholly blind itself to the degree to which the Rule makes the character and result of the federal litigation stray from the course it would follow in state courts, Sibbach v. Wilson & Co., supra, at 13-14, it cannot be forgotten that the Erie rule, and the guidelines suggested in York, were created to serve another purpose altogether. To hold that a Federal Rule of Civil Procedure must cease to function whenever it alters the mode of enforcing state-created rights would be to dis*474embowel either the Constitution's grant of power over federal procedure or Congress’ attempt to exercise that power in the Enabling Act.17 Rule 4 (d) (1) is valid and controls the instant case.

Reversed.

Mr. Justice Harlan,

concurring.

It is unquestionably true that up to now Erie and the cases following it have not succeeded in articulating a workable doctrine governing choice of law in diversity actions. I respect the Court’s eifort to clarify the situation in today’s opinion. However, in doing so I think it has misconceived the constitutional premises of Erie and has failed to deal adequately with those past decisions upon which the courts below relied.

Erie was something more than an opinion which worried about “forum-shopping and avoidance of inequitable administration of the laws,” ante, p. 468, although to be sure these were important elements of the decision. I have always regarded that decision as one of the modern cornerstones of our federalism, expressing policies that profoundly touch the allocation of judicial power between the state and federal systems. Erie recognized that there should not be two conflicting systems of law controlling the primary activity of citizens, for such alternative governing authority must necessarily give rise to a debilitating uncertainty in the planning of everyday affairs.1 And it recognized that the scheme of our Constitution en-. visions an allocation of law-making functions between state and federal legislative processes which is undercut if the federal judiciary can make substantive law affect*475ing state affairs beyond the bounds of congressional legislative powers in this regard. Thus, in diversity cases Erie commands that it be the state law governing primary private activity which prevails.

The shorthand formulations which have appeared in some past decisions are prone to carry untoward results that frequently arise from oversimplification. The Court is quite right in stating that the “outcome-determinative” test of Guaranty Trust Co. v. York, 326 U. S. 99, if taken literally, proves too much, for any rule, no matter how clearly “procedural,” can affect the outcome of litigation if it is not obeyed. In turning from the “outcome” test of York back to the unadorned forum-shopping rationale of Erie, however, the Court falls prey to like oversimplification, for a simple forum-shopping rule also proves too much; litigants often choose a federal forum merely to obtain what they consider the advantages of the Federal Rules of Civil Procedure or to try their cases before a supposedly more favorable judge. To my mind the proper line of approach in determining whether to apply a state or a federal rule, whether “substantive” or “procedural,” is to stay close to basic principles by inquiring if the choice of rule would substantially affect those primary decisions respecting human conduct which our constitutional system leaves to state regulation.2 If so, Erie and the Constitution require that the state rule prevail, even in the face of a conflicting federal rule.

The Court weakens, if indeed it does not submerge, this basic principle by finding, in effect, a grant of substantive legislative power in the constitutional provision for a fed*476eral court system (compare Swift v. Tyson, 16 Pet. 1), and through it, setting up the Federal Rules as a body of law inviolate.

“[T]he constitutional provision for a federal court system . . . carries with it congressional power ... to regulate matters which, though falling within the uncertain area between substance and procedure, are rationally capable of classification as either.” Ante, p. 472. (Emphasis supplied.)

So long as a reasonable man could characterize any duly adopted federal rule as “procedural,” the Court, unless I misapprehend what is said, would have it apply no matter how seriously it frustrated a State’s substantive regulation of the primary conduct and affairs of its citizens. Since the members of the Advisory Committee, the Judicial Conference, and this Court who formulated the Federal Rules are presumably reasonable men, it follows that the integrity of the Federal Rules is absolute. Whereas the unadulterated outcome and forum-shopping tests may err too far toward honoring state rules, I submit that the Court’s “arguably procedural, ergo constitutional” test moves too fast and far in the other direction.

The courts below relied upon this Court’s decisions in Ragan v. Merchants Transfer Co., 337 U. S. 530, and Cohen v. Beneficial Loan Corp., 337 U. S. 541. Those cases deserve more attention than this Court has given them, particularly Ragan which, if still good law, would in my opinion call for affirmance of the result reached by the Court of Appeals. Further, a discussion of these two cases will serve to illuminate the “diversity” thesis I am advocating.

In Ragan a Kansas statute of limitations provided that an action was deemed commenced when service was made on the defendant. Despite Federal Rule 3 which provides that an action commences with the filing of the com*477plaint, the Court held that for purposes of the Kansas statute of limitations a diversity tort action commenced only when service,was made upon the defendant. The effect of this holding was that although the plaintiff had filed his federal complaint within the state period of limitations, his action was barred because the federal marshal did not serve a summons on the defendant until after the limitations period had run. I think that the decision was wrong. At most, application of the Federal Rule would have meant that potential Kansas tort defendants would have to defer for a few days the satisfaction of knowing that they had not been sued within the limitations period. The choice of the Federal Rule would have had no effect on the primary stages of private activity from which torts arise, and only the most minimal effect on behavior following the commission of the tort. In such circumstances the interest of the federal system in proceeding under its own rules should have prevailed.

Cohen v. Beneficial Loan Corp. held that a federal diversity court must apply a state statute requiring a small stockholder in a stockholder derivative suit to post a bond securing payment of defense costs as a condition to prosecuting an action. Such a statute is not “outcome determinative”; the plaintiff can win with or without it. The Court now rationalizes the case on the ground that the statute might affect the plaintiff’s choice of forum (ante, p. 469, n. 10), but as has been pointed out, a simple forum-shopping test proves too much. The proper view of Cohen is, in my opinion, that the statute was meant to inhibit small stockholders from instituting “strike suits,” and thus it was designed and could be expected to have a substantial impact on private primary activity. Anyone who was at the trial bar during the period when Cohen arose can appreciate the strong state policy reflected in the statute. I think it wholly legitimate to view Federal Rule 23 as not purporting to deal *478with the problem. But even had the Federal Rules purported to do so, and in so doing provided a substantially less effective deterrent to strike suits, I think the state rule should still have prevailed. That is where I believe the Court’s view differs from mine; for the Court attributes such overriding force to the Federal Rules that it is hard to think of a case where a conflicting state rule would be allowed to operate, even though the state rule reflected policy considerations which, under Erie, would lie within the realm of state legislative authority.

It remains to apply what has been said to the present case. The Massachusetts rule provides that an executor need not answer suits unless in-hand service was made upon him or notice of the action was filed in the proper registry of probate within one year of his giving bond. The evident intent of this statute is to permit an executor to distribute the estate which he is administering without fear that further liabilities may be outstanding for which he could be held personally liable. If the Federal District Court in Massachusetts applies Rule 4 (d)(1) of the Federal Rules of Civil Procedure instead of the Massachusetts service rule, what effect would that have on the speed and assurance with which estates are distributed? As I see it, the effect would not be substantial. It would mean simply that an executor would have to check at his own house or the federal courthouse as well as the registry of probate before he could distribute the estate with impunity. As this does not seem enough to give rise to any real impingement on the vitality of the state policy which the Massachusetts rule is intended to serve, I concur in the judgment of the Court.

Me. Justice Marshall

delivered the opinion of the Court.

This case presents the issue whether in a diversity action the federal court should follow state law or, alternatively, Rule 3 of the Federal Rules of Civil Procedure in determining when an action is commenced for the purpose of tolling the state statute of limitations.

I

According to the allegations of the complaint, petitioner, a carpenter, was injured on August 22, 1975, in Oklahoma City, Okla., while pounding a Sheffield nail into a cement wall. Respondent was the manufacturer of the nail. Petitioner claimed that the nail contained a defect which caused its head to shatter and strike him in the right eye, resulting in permanent injuries. The defect was allegedly caused by respondent’s negligence in manufacture and design.

Petitioner is a resident of Oklahoma, and respondent is a foreign corporation having its principal place of business in a *742 State other than Oklahoma. Since there was diversity of citizenship, petitioner brought suit in the United States District Court for the Western District of Oklahoma. The complaint was filed on August 19, 1977. Although summons was issued that same day, 1 service of process was not made on respondent’s authorized service agent until December 1, 1977. 2 On January 5, 1978, respondent filed a motion to dismiss the complaint on the ground that the action was barred by the applicable Oklahoma statute of limitations. Although the complaint had been filed within the 2-year statute of limitations, Okla. Stat., Tit. 12, § 95 (1971), 3 state law does not deem the action “commenced” for purposes of the statute of limitations until service of the summons on the defendant, *743 Okla. Stat., Tit. 12, § 97 (1971). 4 If the complaint is filed within the limitations period, however, the action is deemed to have commenced from that date of filing if the plaintiff serves the defendant within 60 days, even though that service may occur outside the limitations period. Ibid. In this case, service was not effectuated until long after this 60-day period had expired. Petitioner in his reply brief to the motion to dismiss admitted that his case would be foreclosed in state court, but he argued that Rule 3 of the Federal Rules of Civil Procedure governs the manner in which an action is commenced in federal court for all purposes, including the tolling of the state statute of limitations. 5

The District Court dismissed the complaint as barred by the Oklahoma statute of limitations. 452 F. Supp. 243 (1978). The court concluded that Okla. Stat., Tit. 12, § 97 (1971) was “an integral part of the Oklahoma statute of limitations,” 452 F. Supp., at 245, and therefore under Ragan v. Merchants Transfer & Warehouse Co., 337 U. S. 530 (1949), state law applied. The court rejected the argument that Ragan had been implicitly overruled in Hanna v. Plumer, 380 U. S. 460 (1965).

*744 The United States Court of Appeals for the Tenth Circuit affirmed. 592 F. 2d 1133 (1979). That court concluded that Okla. Stat., Tit. 12, § 97 (1971), was in “direct conflict” with Rule 3. 592 P. 2d, at 1135. However; the Oklahoma statute was “indistinguishable” from the statute involved in Ragan, and the court felt itself “constrained” to follow Ragan. 592 F. 2d, at 1136.

We granted certiorari, 444 U. S. 823 (1979), because of a conflict among the Courts of Appeals. 6 We now affirm.

II

The question whether state or federal law should apply on various issues arising in an action based on state law which has been brought in federal court under diversity of citizenship jurisdiction has troubled this Court for many years. In the landmark decision of Erie R. Co. v. Tompkins, 304 U. S. 64 (1938), we overturned the rule expressed in Swift v. Tyson, 16 Pet. 1 (1842), that federal courts exercising diversity jurisdiction need not, in matters of “general jurisprudence,” apply the nonstatutory law of the State. The Court noted *745 that “[diversity of citizenship jurisdiction was conferred in order to prevent apprehended discrimination in state courts against those not citizens of the State,” Erie R. Co. v. Tompkins, supra, at 74. The doctrine of Swift v. Tyson had led to the undesirable results of discrimination in favor of non-citizens, prevention of uniformity in the administration of state law, and forum shopping. 304 U. S., at 74-75. In response, we established the rule that “[e]xcept in matters governed by the Federal Constitution or by Acts of Congress, the law to be applied in any [diversity] case is the law of the State,” id., at 78.

In Guaranty Trust Co. v. York, 326 U. S. 99 (1945), we addressed ourselves to “the narrow question whether, when no recovery could be had in a State court because the action is barred by the statute of limitations, a federal court in equity can take cognizance of the suit because there is diversity of citizenship between the parties,” id., at 107. The Court held that the Erie doctrine applied to suits in equity as well as to actions at law. In construing Erie we noted that “[i]n essence, the intent of that decision was to insure that, in all cases where a federal court is exercising jurisdiction solely because of the diversity of citizenship of the parties, the outcome of the litigation in the federal court should be substantially the same, so far as legal rules determine the outcome of a litigation, as it would be if tried in a State court.” 326 U. S., at 109. We concluded that the state statute of limitations should be applied. “Plainly enough, a statute that would completely bar recovery in a suit if brought in a State court bears on a State-created right vitally and not merely formally or negligibly. As to consequences that so intimately affect recovery or non-recovery a federal court in a diversity case should follow State law.” Id., at 110.

The decision in York led logically to our holding in Ragan v. Merchants Transfer & Warehouse Co., supra. In Ragan, the plaintiff had filed his complaint in federal court on September 4, 1945, pursuant to Rule 3 of the Federal Rules of *746 Civil Procedure. The accident from which the claim arose had occurred on October 1, 1943. Service was made on the defendant on December 28, 1945. The applicable statute of limitations supplied by Kansas law was two years. Kansas had an additional statute which provided: “An action shall be deemed commenced within the meaning of [the statute of limitations], as to each defendant, at the date of the summons which is served on him. . . . An attempt to commence an action shall be deemed equivalent to the commencement thereof within the meaning of this article when the party faithfully, properly and diligently endeavors to procure a service; but such attempt must be followed by the first publication or service of the summons within sixty days.” Kan. Gen. Stat. § 60-308 (1935). The defendant moved for summary judgment on the ground that the Kansas statute of limitations barred the action since service had not been made within either the 2-year period or the 60-day period. It was conceded that had the case been brought in Kansas state court it would have been barred. Nonetheless, the District Court held that the statute had been tolled by the filing of the complaint. The Court of Appeals reversed because “the requirement of service of summons within the statutory period was an integral part of that state’s statute of limitations.” Ragan, 337 U. S., at 532.

We affirmed, relying on Ene and York. “We cannot give [the cause of action] longer life in the federal court than it would have had in the state court without adding something to the cause of action. We may not do' that consistently with Erie R. Co. v. Tompkins.” 337 U. S., at 533-534. We rejected the argument that Rule 3 of the Federal Rules of Civil Procedure governed the manner in which an action was commenced in federal court for purposes of tolling the state statute of limitations. Instead, we held that the service of summons statute controlled because it was an integral part of the state statute of limitations, and under York that statute of limitations was part of the state-law cause of action.

*747 Ragan was not our last pronouncement in this difficult area, however. In 1965 we decided Hanna v. Plumer, 380 U. S. 460, holding that in a civil action where federal jurisdiction was based upon diversity of citizenship, Rule 4 (d)(1) of the Federal Rules of Civil Procedure, rather than state law, governed the manner in which process was served. Massachusetts law required in-hand service on an executor or administrator of an estate, whereas Rule 4 permits service by leaving copies of the summons and complaint at the defendant’s home with some person “of suitable age and discretion.” The Court noted that in the absence of a conflicting state procedure, the Federal Rule would plainly control, 380 U. S., at 465. We stated that the “outcome-determination” test of Erie and York had to be read with reference to the “twin aims” of Erie: “discouragement of forum-shopping and avoidance of inequitable administration of the laws.” 380 U. S., at 468. We determined that the choice between the state in-hand service rule and the Federal Rule “would be of scant, if any, relevance to the choice of a forum,” for the plaintiff “was not presented with a situation where application of the state rule would wholly bar recovery; rather, adherence to the state rule would have resulted only in altering the way in which process was served.” Id., at 469 (footnote omitted). This factor served to distinguish that case from York and Ragan. See 380 U. S., at 469, n. 10.

The Court in Hanna, however, pointed out “a more fundamental flaw” in the defendant’s argument in that case. Id., at 469. The Court concluded that the Erie doctrine was simply not the appropriate test of the validity and applicability of one of the Federal Rules of Civil Procedure:

“The Erie rule has never been invoked to void a Federal Rule. It is true that there have been cases where this Court had held applicable a state rule in the face of an argument that the situation was governed by one of the *748 Federal Rules. But the holding of each such ease was not that Erie commanded displacement of a Federal Rule by an inconsistent state rule, but rather that the scope of the Federal Rule was not as broad as the losing party urged, and therefore, there being no Federal Rule which covered the point in dispute, Erie commanded the enforcement of state law.” 380 U. S., at 470.

The Court cited Ragan as one of the examples of this proposition, 380 U. S., at 470, n. 12. 7 The Court explained that where the Federal Rule was clearly applicable, as in Hanna, the test was whether the Rule was within the scope of the Rules Enabling Act, 28 U. S. C. § 2072, and if so, within a constitutional grant of power such as the Necessary and Proper Clause of Art. I. 380 U. S., at 470-472.

Ill

The present case is indistinguishable from Ragan. The statutes in both cases require service of process to toll the statute of limitations, and in fact the predecessor to the Oklahoma statute in this case was derived from the predecessor to the Kansas statute in Ragan. See Dr. Koch Vegetable Tea Co. v. Davis, 48 Okla. 14, 22, 145 P. 337, 340 (1914). Here, as in Ragan, the complaint was filed in federal court under diversity jurisdiction within the 2-year statute of limitations, but service of process did not occur until after the 2-year period and the 60-day service period had run. In both cases the suit would concededly have been barred in the applicable state court, and in both instances the state service statute was held to be an integral part of the statute of limitations by the lower court more familiar than we with state law. Accordingly, as the Court of Appeals held below, *749 the instant action is barred by the statute of limitations unless Ragan is no longer good law.

Petitioner argues that the analysis and holding of Ragan did not survive our decision in Hanna. 8 Petitioner’s position is that Okla. Stat., Tit. 12, § 97 (1971), is in direct conflict with the Federal Rule. Under Hanna, petitioner contends, the appropriate question is whether Rule 3 is within the scope of the Rules Enabling Act and, if so, within the constitutional power of Congress. In petitioner’s view, the Federal Rule is to be applied unless it violates one of those two restrictions. This argument ignores both the force of stare decisis and the specific limitations that we carefully placed on the Hanna analysis.

We note at the outset that the doctrine of stare decisis weighs heavily against petitioner in this case. Petitioner seeks to have us overrule our decision in Ragan. Stare decisis does not mandate that earlier decisions be enshrined forever, of course, but it does counsel that we use caution in rejecting established law. In this case, the reasons petitioner asserts for overruling Ragan are the same factors which we concluded in Hanna did not undermine the validity of Ragan. A litigant who in effect asks us to reconsider not one but two prior decisions bears a heavy burden of supporting such a change in our jurisprudence. Petitioner here has not met that burden.

This Court in Hanna distinguished Ragan rather than overruled it, and for good reason. Application of the Hanna analysis is premised on a “direct collision” between the Federal Rule and the state law. 380 U. S., at 472. In Hanna itself the “clash” between Rule 4 (d) (1) and the state in-hand service requirement was “unavoidable.” 380 U. S., at 470. The first question must therefore be whether the scope of the Federal Rule in fact is sufficiently broad to control the issue before *750 the Court. It is only if that question is answered affirmatively that the Hanna analysis applies. 9

As has already been noted, we recognized in Hanna that the present case is an instance where “the scope of the Federal Rule [is] not as broad as the losing party urge[s], and therefore, there being no Federal Rule which cover[s] the point in dispute, Erie command[s] the enforcement of state law.” Ibid. Rule 3 simply states that “[a] civil action is commenced by filing a complaint with the court.” There is no indication that the Rule was intended to toll a state statute of limitations, 10 much less that it purported to displace state *751 tolling rules for purposes of state statutes of limitations. In our view, in diversity actions 11 Rule 3 governs the date from which various timing requirements of the Federal Rules begin to run, but does not affect state statutes of limitations. Cf. 4 C. Wright & A. Miller, Federal Practice and Procedure § 1057, pp. 190-191 (1969); id., § 1051, at 165-166.

In contrast to Rule 3, the Oklahoma statute is a statement of a substantive decision by that State that actual service on, and accordingly actual notice by, the defendant is an integral part of the several policies served by the statute of limitations. See C & C Tile Co. v. Independent School District No. 7 of Tulsa County, 503 P. 2d 554, 559 (Okla. 1972). The statute of limitations establishes a deadline after which the defendant may legitimately have peace of mind; it also recognizes that after a certain period of time it is unfair to require the defendant to attempt to piece together his defense to an old claim. A requirement of actual service promotes both of those functions of the statute. See generally ibid.; Seitz v. Jones, 370 P. 2d 300, 302 (Okla. 1961). See also Ely, The Irrepressible Myth of Erie, 87 Harv. L. Rev. 693, 730-731 (1974). 12 It is these policy aspects which make the service *752 requirement an “integral” part of the statute of limitations both in this case and in Ragan. As such, the service rule must be considered part and parcel of the statute of limitations. 13 Rule 3 does not replace such policy determinations found in state law. Rule 3 and Okla. Stat., Tit. 12, § 97 (1971), can exist side by side, therefore, each controlling its own intended sphere of coverage without conflict.

Since there is no direct conflict between the Federal Rule and the state law, the Hanna analysis does not apply. 14 Instead, the policies behind Erie and Ragan control the issue whether, in the absence of a federal rule directly on point, state service requirements which are an integral part of the state statute of limitations should control in an action based on state law which is filed in federal court under diversity *753 jurisdiction. The reasons for the application of such a state service requirement in a diversity action in the absence of a conflicting federal rule are well explained in Erie and Ragan, see supra, at 744-746, and need not be repeated here. It is sufficient to note that although in this case failure to apply the state service law might not create any problem of forum shopping, 15 the result would be an “inequitable administration” of the law. Hanna v. Plumer, 380 U. S., at 468. There is simply no reason why, in the absence of a controlling federal rule, an action based on state law which concededly would be barred in the state courts by the state statute of limitations should proceed through litigation to judgment in federal court solely because of the fortuity that there is diversity of citizenship between the litigants. The policies underlying diversity jurisdiction do not support such a distinction between state and federal plaintiffs, and Erie and its progeny do not permit it.

The judgment of the Court of Appeals is

Affirmed.

Justice Ginsburg

delivered the opinion of the Court.

Under the law of New York, appellate courts are empowered to review the size of jury verdicts and to order new trials when the jury’s award “deviates materially from what would be reasonable compensation.” N. Y. Civ. Prac. Law and Rules (CPLR) § 5501(c) (McKinney 1995). Under the Seventh Amendment, which governs proceedings in federal court, but not in state court, “the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.” U. S. Const., Arndt. 7. *419The compatibility of these provisions, in an action based on New York law but tried in federal court by reason of the parties’ diverse citizenship, is the issue we confront in this case. We hold that New York’s law controlling compensation awards for excessiveness or inadequacy can be given effect, without detriment to the Seventh Amendment, if the review standard set out in CPLR § 5501(c) is applied by the federal trial court judge, with appellate control of the trial court’s ruling limited to review for “abuse of discretion.”

1 — I

Petitioner William Gasperini, a journalist for CBS News and the Christian Science Monitor, began reporting on events in Central America in 1984. He earned his living primarily in radio and print media and only occasionally sold his photographic work. During the course of his seven-year stint in Central America, Gasperini took over 5,000 slide transparencies, depicting active war zones, political leaders, and scenes from daily life. In 1990, Gasperini agreed to supply his original color transparencies to The Center for Humanities, Inc. (Center) for use in an educational videotape, Conflict in Central America. Gasperini selected 300 of his slides for the Center; its videotape included 110 of them. The Center agreed to return the original transparencies, but upon the completion of the project, it could not find them.

Gasperini commenced suit in the United States District Court for the Southern District of New York, invoking the court’s diversity jurisdiction pursuant to 28 U. S. C. § 1332.1 He alleged several state-law claims for relief, including breach of contract, conversion, and negligence. See App. 5-6. The Center conceded liability for the lost transparencies and the issue of damages was tried before a jury.

*420At trial, Gasperini’s expert witness testified that the “industry standard” within the photographic publishing community valued a lost transparency at $1,500. See id., at 227. This industry standard, the expert explained, represented the average license fee a commercial photograph could earn over the full course of the photographer’s copyright, i. e., in Gasperini’s case, his lifetime plus 50 years. See id., at 228; see also 17 U. S. C. § 302(a). Gasperini estimated that his earnings from photography totaled just over $10,000 for the period from 1984 through 1993. He also testified that he intended to produce a book containing his best photographs from Central America. See App. 175.

After a three-day trial, the jury awarded Gasperini $450,000 in compensatory damages. This sum, the jury foreperson announced, “is [$]1500 each, for 300 slides.” Id., at 313. Moving for a new trial under Federal Rule of Civil Procedure 59, the Center attacked the verdict on various grounds, including excessiveness. Without comment, the District Court denied the motion. See App. to Pet. for Cert. 12a.

The Court of Appeals for the Second Circuit vacated the judgment entered on the jury’s verdict. 66 F. 3d 427 (1995). Mindful that New York law governed the controversy, the Court of Appeals endeavored to apply CPLR § 5501(c), which instructs that, when a jury returns an itemized verdict, as the jury did in this case, the New York Appellate Division “shall determine that an award is excessive or inadequate if it deviates materially from what would be reasonable compensation.” The Second Circuit’s application of § 5501(c) as a check on the size of the jury’s verdict followed Circuit precedent elaborated two weeks earlier in Consorti v. Armstrong World Industries, Inc., 64 F. 3d 781, superseded, 72 F. 3d 1003 (1995). Surveying Appellate Division decisions that reviewed damage awards for lost transparencies, the Second Circuit concluded that testimony on industry standard alone was insufficient to justify a verdict; prime among other fac*421tors warranting consideration were the uniqueness of the slides’ subject matter and the photographer’s earning level.2

Guided by Appellate Division rulings, the Second Circuit held that the $450,000 verdict “materially deviates from what is reasonable compensation.” 66 F. 3d, at 431. Some of Gasperini’s transparencies, the Second Circuit recognized, were unique, notably those capturing combat situations in which Gasperini was the only photographer present. Id., at 429. But others “depicted either generic scenes or events at which other professional photojournalists were present.” Id., at 431. No more than 50 slides merited a $1,500 award, the court concluded, after “[g]iving Gasperini every benefit of the doubt.” Ibid. Absent evidence showing significant earnings from photographic endeavors or concrete plans to publish a book, the court further determined, any damage award above $100 each for the remaining slides would be excessive. Remittiturs “presen[t] difficult problems for appellate courts,” the Second Circuit acknowledged, for court of appeals judges review the evidence from “a cold paper record.” Ibid. Nevertheless, the Second Circuit set aside the $450,000 verdict and ordered a new trial, unless Gasper-ini agreed to an award of $100,000.

*422This case presents an important question regarding the standard a federal court uses to measure the alleged exces-siveness of a jury’s verdict in an action for damages based on state law. We therefore granted certiorari. 516 U. S. 1086 (1996).

II

Before 1986, state and federal courts in New York generally invoked the same judge-made formulation in responding to excessiveness attacks on jury verdicts: courts would not disturb an award unless the amount was so exorbitant that it “shocked the conscience of the court.” See Consorti, 72 F. 3d, at 1012-1013 (collecting cases). As described by the Second Circuit:

“The standard for determining excessiveness and the appropriateness of remittitur in New York is somewhat ambiguous. Prior to 1986, New York law employed the same standard as the federal courts, see Matthews v. CTI Container Transport Int’l Inc., 871 F. 2d 270, 278 (2d Cir. 1989), which authorized remittitur only if the jury’s verdict was so excessive that it ‘shocked the conscience of the court.’” Id., at 1012.

See also D. Siegel, Practice Commentaries C5501:10, reprinted in 7B McKinney’s Consolidated Laws of New York Ann., p. 25 (1995) (“conventional standard for altering the verdict was that its sum was so great or so small that it ‘shocked the conscience’ of the court”).

In both state and federal courts, trial judges made the excessiveness assessment in the first instance, and appellate judges ordinarily deferred to the trial court’s judgment. See, e. g., McAllister v. Adam Packing Corp., 66 App. Div. 2d 975, 976, 412 N. Y. S. 2d 50, 52 (3d Dept. 1978) (“The trial court’s determination as to the adequacy of the jury verdict will only be disturbed by an appellate court where it can be said that the trial court’s exercise of discretion was not reasonably grounded.”); Martell v. Boardwalk Enterprises, *423Inc., 748 F. 2d 740, 750 (CA2 1984) (“The trial court’s refusal to set aside or reduce a jury award will be overturned only for abuse of discretion.”).

In 1986, as part of a series of tort reform measures,3 New York codified a standard for judicial review of the size of jury awards. Placed in CPLR § 5501(c), the prescription reads:

“In reviewing a money judgment... in which it is contended that the award is excessive or inadequate and that a new trial should have been granted unless a stipulation is entered to a different award, the appellate division shall determine that an award is excessive or inadequate if it deviates materially from what would be reasonable compensation.”4

As stated in Legislative Findings and Declarations accompanying New York’s adoption of the “deviates materially” formulation, the lawmakers found the “shock the conscience” test an insufficient check on damage awards; the legislature therefore installed a standard “invit[ing] more careful appellate scrutiny.” Ch. 266, 1986 N. Y. Laws 470 (McKinney). At the same time, the legislature instructed the Appellate Division, in amended §5522, to state the reasons for the court’s rulings on the size of verdicts, and the factors the *424court considered in complying with § 5501(c).5 In his signing statement, then-Governor Mario Cuomo emphasized that the CPLR amendments were meant to rachet up the review standard: “This will assure greater scrutiny of the amount of verdicts and promote greater stability in the tort system and greater fairness for similarly situated defendants throughout the State.” Memorandum on Approving L. 1986, Ch. 682, 1986 N. Y. Laws, at 3184; see also Newman & Ahmuty, Appellate Review of Punitive Damage Awards, in Insurance, Excess, and Reinsurance Coverage Disputes 1990, p. 409 (B. Ostrager & T. Newman eds. 1990) (review standard prescribed in § 5501(c) “was intended to . . . encourage Appellate Division modification of excessive awards”).

New York state-court opinions confirm that § 5501(c)’s “deviates materially” standard calls for closer surveillance than “shock the conscience” oversight. See, e. g., O'Connor v. Graziosi, 131 App. Div. 2d 553, 554, 516 N. Y. S. 2d 276, 277 (2d Dept. 1987) (“apparent intent” of 1986 legislation was “to facilitate appellate changes in verdicts”); Harvey v. Mazal American Partners, 79 N. Y. 2d 218, 225, 590 N. E. 2d 224, 228 (1992) (instructing Appellate Division to use, in setting remittitur, only the “deviates materially” standard, and not the “shock the conscience” test); see also Consorti, 72 F. 3d, at 1013 (“Material deviation from reasonableness is less than that deviation required to find an award so excessive as to ‘shock the conscience.’”); 7 J. Weinstein, H. Korn, & A. Miller, New York Civil Practice ¶ 5501.21, p. 55-64 (1995) (“Under [§5501(c)’s] new standard, the reviewing court is given greater power to review the size of a jury award than had heretofore been afforded . . . .”).

*425Although phrased as a direction to New York’s intermediate appellate courts, §5501(c)’s “deviates materially” standard, as construed by New York’s courts, instructs state trial judges as well. See, e.g., Inya v. Ide Hyundai, Inc., 209 App. Div. 2d 1015, 619 N. Y. S. 2d 440 (4th Dept. 1994) (error for trial court to apply “shock the conscience” test to motion to set aside damages; proper standard is whether award “materially deviates from what would be reasonable compensation”); Cochetti v. Gralow, 192 App. Div. 2d 974, 975, 597 N. Y. S. 2d 234, 235 (3d Dept. 1993) (“settled law” that trial courts conduct “materially deviates” inquiry); Shurgan v. Tedesco, 179 App. Div. 2d 805, 806, 578 N. Y. S. 2d 658, 659 (2d Dept. 1992) (approving trial court’s application of “materially deviates” standard); see also Lightfoot v. Union Carbide Corp., 901 F. Supp. 166, 169 (SDNY 1995) (CPLR 5501(c)’s “materially deviates” standard “is pretty well established as applicable to [state] trial and appellate courts.”). Application of § 5501(c) at the trial level is key to this case.

To determine whether an award “deviates materially from what would be reasonable compensation,” New York state courts look to awards approved in similar cases. See, e. g., Leon v. J & M Peppe Realty Corp., 190 App. Div. 2d 400, 416, 596 N. Y. S. 2d 380, 389 (1st Dept. 1993) (“These awards ... are not out of line with recent awards sustained by appellate courts.”); Johnston v. Joyce, 192 App. Div. 2d 1124, 1125, 596 N. Y. S. 2d 625, 626 (4th Dept. 1993) (reducing award to maximum amount previously allowed for similar type of harm). Under New York’s former “shock the conscience” test, courts also referred to analogous cases. See, e. g., Senko v. Fonda, 53 App. Div. 2d 638, 639, 384 N. Y. S. 2d 849, 851 (2d Dept. 1976). The “deviates materially” standard, however, in design and operation, influences outcomes by tightening the range of tolerable awards. See, e. g., Consorti, 72 F. 3d, at 1013, and n. 10, 1014-1015, and n. 14.

*426III

In cases like Gasperinis, m which New York law governs the claims for relief, does New York law also supply the test for federal-court review of the size of the verdict? The Center answers yes. The “deviates materially” standard, it argues, is a substantive standard that must be applied by federal appellate courts in diversity cases. The Second Circuit agreed. See 66 F. 3d, at 430; see also Consorti, 72 F. 3d, at 1011 (“[CPLR § 5501(c)] is the substantive rule provided by New York law.”). Gasperini, emphasizing that § 5501(c) trains on the New York Appellate Division, characterizes the provision as procedural, an allocation of decisionmaking authority regarding damages, not a hard cap on the amount recoverable. Correctly comprehended, Gasperini urges, § 5501(c)’s direction to the Appellate Division cannot be given effect by federal appellate courts without violating the Seventh Amendment’s Reexamination Clause.

As the parties’ arguments suggest, CPLR § 5501(c), appraised under Erie R. Co. v. Tompkins, 304 U. S. 64 (1938), and decisions in Erie’s path, is both “substantive” and “procedural”: “substantive” in that §5501(c)’s “deviates materially” standard controls how much a plaintiff can be awarded; “procedural” in that § 5501(c) assigns decisionmaking authority to New York's Appellate Division. Parallel application of § 5501(c) at the federal appellate level would be out of sync with the federal system’s division of trial and appellate court functions, an allocation weighted by the Seventh Amendment. The dispositive question, therefore, is whether federal courts can give effect to the substantive thrust of § 5501(c) without untoward alteration of the federal scheme for the trial and decision of civil cases.

A

Federal diversity jurisdiction provides an alternative forum for the adjudication of state-created rights, but it does not carry with it generation of rules of substantive law. As *427Erie read the Rules of Decision Act:6 “Except in matters governed by the Federal Constitution or by Acts of Congress, the law to be applied in any case is the law of the State.” 304 U. S., at 78. Under the Erie doctrine, federal courts sitting in diversity apply state substantive law and federal procedural law.

Classification of a law as “substantive” or “procedural” for Erie purposes is sometimes a challenging endeavor.7 Guaranty Trust Co. v. York, 326 U. S. 99 (1945), an early interpretation of Erie, propounded an “outcome-determination” test: “[D]oes it significantly affect the result of a litigation for a federal court to disregard a law of a State that would be controlling in an action upon the same claim by the same parties in a State court?” 326 U. S., at 109. Ordering application of a state statute of limitations to an equity proceeding in federal court, the Court said in Guar*428anty Trust: “[W]here a federal court is exercising jurisdiction solely because of the diversity of citizenship of the parties, the outcome of the litigation in the federal court should be substantially the same, so far as legal rules determine the outcome of a litigation, as it would be if tried in a State court.” Ibid,.; see also Ragan v. Merchants Transfer & Warehouse Co., 337 U. S. 530, 533 (1949) (when local law that creates the cause of action qualifies it, “federal court must follow suit,” for “a different measure of the cause of action in one court than in the other [would transgress] the principle of Erie”). A later pathmarking case, qualifying Guaranty Trust, explained that the “outcome-determination” test must not be applied mechanically to sweep in all manner of variations; instead, its application must be guided by “the twin aims of the Erie rule: discouragement of forum-shopping and avoidance of inequitable administration of the laws.” Hanna v. Plumer, 380 U. S. 460, 468 (1965).

Informed by these decisions, we address the question whether New York’s “deviates materially” standard, codified in CPLR § 5501(c), is outcome affective in this sense: Would “application of the [standard]... have so important an effect upon the fortunes of one or both of the litigants that failure to [apply] it would [unfairly discriminate against citizens of the forum State, or] be likely to cause a plaintiff to choose the federal court”? Id., at 468, n. 9.8

We start from a point the parties do not debate. Gasper-ini acknowledges that a statutory cap on damages would supply substantive law for Erie purposes. See Reply Brief for *429Petitioner 2 (“[T]he state as a matter of its substantive law may, among other things, eliminate the availability of damages for a particular claim entirely, limit the factors a jury may consider in determining damages, or place an absolute cap on the amount of damages available, and such substantive law would be applicable in a federal court sitting in diversity.”); see also Tr. of Oral Arg. 4-5, 25; Consorti, 72 F. 3d, at 1011.9 Although CPLR § 5501(c) is less readily classified, it was designed to provide an analogous control.

New York’s Legislature codified in § 5501(c) a new standard, one that requires closer court review than the common-law “shock the conscience” test. See supra, at 422-423. More rigorous comparative evaluations attend application of §5501(c)’s “deviates materially” standard. See supra, at 423-425. To foster predictability, the legislature required the reviewing court, when overturning a verdict under § 5501(c), to state its reasons, including the factors it considered relevant. See CPLR § 5522(b); supra, at 423-424. We think it a fair conclusion that CPLR § 5501(c) differs from a statutory cap principally “in that the maximum amount recoverable is not set forth by statute, but rather is determined by case law.” Brief for City of New York as Amicus Curiae 11. In sum, § 5501(c) contains a procedural instruction, see supra, at 426, but the State’s objective is manifestly substantive. Cf. S. A. Healy Co. v. Milwaukee Metropolitan Sewerage Dist., 60 F. 3d 305, 310 (CA7 1995).

It thus appears that if federal courts ignore the change in the New York standard and persist in applying the “shock *430the conscience” test to damage awards on claims governed by New York law,10 “‘substantial’ variations between state and federal [money judgments]” may be expected. See Hanna, 380 U. S., at 467-468.11 We therefore agree with the Second Circuit that New York’s check on excessive damages implicates what we have called Erie’s “twin aims.” See supra, at 428.12 Just as the Erie principle precludes a federal court from giving a state-created claim “longer life . . . than [the claim] would have had in the state court,” Ragan, *431337 U. S., at 533-534, so Erie precludes a recovery in federal court significantly larger than the recovery that would have been tolerated in state court.

B

CPLR § 5501(c), as earlier noted, see supra, at 425, 426, is phrased as a direction to the New York Appellate Division. Acting essentially as a surrogate for a New York appellate forum, the Court of Appeals reviewed Gasperini’s award to determine if it “deviate[d] materially” from damage awards the Appellate Division permitted in similar circumstances. The Court of Appeals performed this task without benefit of an opinion from the District Court, which had denied “without comment” the Center’s Rule 59 motion. 66 F. 3d, at 428. Concentrating on the authority § 5501(e) gives to the Appellate Division, Gasperini urges that the provision shifts fact-finding responsibility from the jury and the trial judge to the appellate court. Assigning such responsibility to an appellate court, he maintains, is incompatible with the Seventh Amendment’s Reexamination Clause, and therefore, Gasper-ini concludes, § 5501(c) cannot be given effect in federal court. Brief for Petitioner 19-20. Although we reach a different conclusion than Gasperini, we agree that the Second Circuit did not attend to “[a]n essential characteristic of [the federal court] system,” Byrd v. Blue Ridge Rural Elec. Cooperative, Inc., 356 U. S. 525, 537 (1958), when it used § 5501(c) as “the standard for [federal] appellate review,” Consorti, 72 F. 3d, at 1013; see also 66 F. 3d, at 430.

That “essential characteristic” was described in Byrd, a diversity suit for negligence in which a pivotal issue of fact would have been tried by a judge were the case in state court. The Byrd Court held that, despite the state practice,13 the plaintiff was entitled to a jury trial in federal court.

*432In so ruling, the Court said that the Guaranty Trust “outcome-determination” test was an insufficient guide in cases presenting countervailing federal interests. See Byrd, 356 U. S., at 537. The Court described the countervailing federal interests present in Byrd this way:

“The federal system is an independent system for administering justice to litigants who properly invoke its jurisdiction. An essential characteristic of that system is the manner in which, in civil common-law actions, it distributes trial functions between judge and jury and, under the influence — if not the command — of the Seventh Amendment, assigns the decisions of disputed questions of fact to the jury.” Ibid, (footnote omitted).

The Seventh Amendment, which governs proceedings in federal court, but not in state court,14 bears not only on the allocation of trial functions between judge and jury, the issue in Byrd; it also controls the allocation of authority to review verdicts, the issue of concern here. The Amendment reads:

“In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.” U. S. Const., Arndt. 7.

Byrd involved the first Clause of the Amendment, the “trial by jury” Clause. This case involves the second, the “re-examination” Clause. In keeping with the historic un*433derstanding,15 the Reexamination Clause does not inhibit the authority of trial judges to grant new trials “for any of the reasons for which new trials have heretofore been granted in actions at law in the courts of the United States.” Fed. Rule Civ. Proc. 59(a). That authority is large. See 6A Moore’s Federal Practice ¶ 59.05[2], pp. 59-44 to 59-46 (2d ed. 1996) (“The power of the English common law trial courts to grant a new trial for a variety of reasons with a view to the attainment of justice was well established prior to the establishment of our Government.”); see also Aetna Casualty & Surety Co. v. Yeatts, 122 F. 2d 350, 353 (CA4 1941) (“The exercise of [the trial court’s power to set aside the jury’s verdict and grant a new trial] is not in derogation of the right of trial by jury but is one of the historic safeguards of that right.”); Blunt v. Little, 3 F. Cas. 760, 761-762 (No. 1,578) (CC Mass. 1822) (Story, J.) (“[I]f it should clearly appear that the jury have committed a gross error, or have acted from improper motives, or have given damages excessive in relation to the person or the injury, it is as much the duty of the court to interfere, to prevent the wrong, as in any other case.”). “The trial judge in the federal system,” we have reaffirmed, “has . . . discretion to grant a new trial if the verdict appears to [the judge] to be against the weight of the evidence.” Byrd, 356 U. S., at 540. This discretion includes overturning verdicts for excessiveness and ordering a new trial without qualification, or conditioned on the verdict winner’s refusal to agree to a reduction (remittitur). See Dimick v. Schiedt, 293 U. S. 474, 486-487 (1935) (recognizing that remittitur withstands Seventh Amendment attack, but rejecting additur as unconstitutional).16

*434In contrast, appellate review of a federal trial court’s denial of a motion to set aside a jury’s verdict as excessive is a relatively late, and less secure, development. Such review was once deemed inconsonant with the Seventh Amendment’s Reexamination Clause. See, e. g., Lincoln v. Power, 151 U. S. 436, 437-438 (1894); Williamson v. Osenton, 220 F. 653, 655 (CA4 1915); see also 6A Moore’s Federal Practice ¶59.08[6], at 59-167 (collecting cases). We subsequently recognized that, even in cases in which the Erie doctrine was not in play — cases arising wholly under federal law— the question was not settled; we twice granted certiorari to decide the unsettled issue, but ultimately resolved the cases on other grounds. See Grunenthal v. Long Island R. Co., 393 U. S. 156, 158 (1968); Neese v. Southern R. Co., 350 U. S. 77 (1955).17

Before today, we have not “expressly [held] that the Seventh Amendment allows appellate review of a district court’s denial of a motion to set aside an award as excessive.” Browning-Ferris Industries of Vt., Inc. v. Kelco Disposal, Inc., 492 U. S. 257, 279, n. 25 (1989). But in successive reminders that the question was worthy of this Court’s attention, we noted, without disapproval, that courts of appeals engage in review of district court excessiveness determina*435tions, applying “abuse of discretion” as their standard. See Grunenthal, 393 U. S., at 159. We noted the Circuit decisions in point, id., at 157, n. 3, and, in Browning-Ferris, we again referred to appellate court abuse-of-discretion review:

“[T]he role of the district court is to determine whether the jury’s verdict is within the confines set by state law, and to determine, by reference to federal standards developed under Rule 59, whether a new trial or remittitur should be ordered. The court of appeals should then review the district court’s determination under an abuse-of-discretion standard.” 492 U. S., at 279.18

As the Second Circuit explained, appellate review for abuse of discretion is reconcilable with the Seventh Amendment as a control necessary and proper to the fair administration of justice: “We must give the benefit of every doubt to the judgment of the trial judge; but surely there must be an upper limit, and whether that has been surpassed is not a question of fact with respect to which reasonable men may differ, but a question of law.” Dagnello v. Long Island R. Co., 289 F. 2d 797, 806 (CA2 1961) (quoted in Grunenthal, 393 U. S., at 159). All other Circuits agree. See, e. g., Holmes v. Elgin, Joliet & Eastern R. Co., 18 F. 3d 1393, 1396 (CA7 1994); 11 C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure §2820, p. 209 (2d ed. 1995) (“[E]very circuit has said that there are circumstances in which it can reverse the denial of a new trial if the size of the verdict seems to be too far out of line.”); 6A Moore’s Federal Practice *436¶ 59.08[6], at 59-177 to 59-185 (same).19 We now approve this line of decisions, and thus make explicit what Justice Stewart thought implicit in our Grunenthal disposition: “[N]othing in the Seventh Amendment . . . precludes appellate review of the trial judge’s denial of a motion to set aside [a jury verdict] as excessive.” 393 U. S., at 164 (Stewart, J., dissenting) (internal quotation marks and footnote omitted).20

C

In Byrd, the Court faced a one-or-the-other choice: trial by judge as in state court, or trial by jury according to the federal practice.21 In the case before us, a choice of that *437order is not required, for the principal state and federal interests can be accommodated. The Second Circuit correctly recognized that when New York substantive law governs a claim for relief, New York law and decisions guide the allowable damages. See 66 F. 3d, at 430; see also Consorti, 72 F. 3d, at 1011. But that court did not take into account the characteristic of the federal court system that caused us to reaffirm: “The proper role of the trial and appellate courts in the federal system in reviewing the size of jury verdicts is ... a matter of federal law.” Donovan v. Penn Shipping Co., 429 U. S. 648, 649 (1977) (per curiam); see also Browning-Ferris, 492 U. S., at 279 (“[T]he role of the district court is to determine whether the jury’s verdict is within the confines set by state law .... The court of appeals should then review the district court’s determination under an abuse-of-discretion standard. ”).

New York’s dominant interest can be respected, without disrupting the federal system, once it is recognized that the federal district court is capable of performing the checking function, i. e., that court can apply the State’s “deviates materially” standard in line with New York case law evolving under CPLR § 5501(c).22 We recall, in this regard, that the *438“deviates materially” standard serves as the guide to be applied in trial as well as appellate courts in New York. See supra, at 425.

Within the federal system, practical reasons combine with Seventh Amendment constraints to lodge in the district court, not the court of appeals, primary responsibility for application of §5501(c)’s “deviates materially” check. Trial judges have the “unique opportunity to consider the evidence in the living courtroom context,” Taylor v. Washington Terminal Co., 409 F. 2d 145, 148 (CADC 1969), while appellate judges see only the “cold paper record,” 66 F. 3d, at 431.

District court applications of the “deviates materially” standard would be subject to appellate review under the standard the Circuits now employ when inadequacy or exces-siveness is asserted on appeal: abuse of discretion. See 11 Wright & Miller, Federal Practice and Procedure §2820, at 212-214, and n. 24 (collecting cases); see 6A Moore’s Federal Practice ¶ 59.08[6], at 59-177 to 59-185 (same). In light of Erie’s doctrine, the federal appeals court must be guided by the damage-control standard state law supplies,23 but as the Second Circuit itself has said: “If we reverse, it must be because of an abuse of discretion. . . . The very nature of the problem counsels restraint. . . . We must give the benefit of *439every doubt to the judgment of the trial judge.” Dagnello, 289 F. 2d, at 806.

IV

It does not appear that the District Court checked the jury’s verdict against the relevant New York decisions demanding more than “industry standard” testimony to support an award of the size the jury returned in this case. As the Court of Appeals recognized, see 66 F. 3d, at 429, the uniqueness of the photographs and the plaintiff’s earnings as photographer — past and reasonably projected — are factors relevant to appraisal of the award. See, e. g., Blackman v. Michael Friedman Publishing Group, Inc., 201 App. Div. 2d 328, 607 N. Y. S. 2d 43, 44 (1st Dept. 1994); Nierenberg v. Wursteria, Inc., 189 App. Div. 2d 571, 571-572, 592 N. Y. S. 2d 27, 27-28 (1st Dept. 1993). Accordingly, we vacate the judgment of the Court of Appeals and instruct that court to remand the case to the District Court so that the trial judge, revisiting his ruling on the new trial motion, may test the jury’s verdict against CPLR §5501(c)’s “deviates materially” standard.

It is so ordered.

Justice Stevens,

dissenting.

While I agree with most of the reasoning in the Court’s opinion, I disagree with its disposition of the case. I would affirm the judgment of the Court of Appeals. I would also reject the suggestion that the Seventh Amendment limits the power of a federal appellate court sitting in diversity to decide whether a jury’s award of damages exceeds a.limit established by state law.

I

The Court correctly explains why the 1986 enactment of § 5501(c) of the N. Y. Civ. Prac. Law and Rules (McKinney 1995) changed the substantive law of the State. A state-law ceiling on allowable damages, whether fixed by a dollar limit or by a standard that forbids any award that “deviates mate*440rially from what would be reasonable compensation,” ibid., is a substantive rule of decision that federal courts must apply in diversity cases governed by New York law.

I recognize that state rules of appellate procedure do not necessarily bind federal appellate courts. The majority persuasively shows, however, that New York has not merely adopted a new procedure for allocating the decisionmaking function between trial and appellate courts. Ante, at 422-425. Instead, New York courts have held that all jury awards, not only those reviewed on appeal, must conform to the requirement that they not “deviatfe] materially” from amounts awarded in like cases. Ante, at 425. That New York has chosen to tie its damages ceiling to awards traditionally recovered in similar cases, rather than to a legislatively determined but inflexible monetary sum, is none of our concern.

Given the nature of the state-law command, the Court of Appeals for the Second Circuit correctly concluded in Consorti v. Armstrong World Industries, Inc., 64 F. 3d 781, superseded, 72 F. 3d 1003 (1995), that New York’s excessiveness standard applies in federal court in diversity cases controlled by New York law. Consorti erred in basing that conclusion in part on the fact that a New York statute requires that State’s appellate division to apply the standard, but it was nevertheless faithful to the Rules of Decision Act, as construed in Erie R. Co. v. Tompkins, 304 U. S. 64 (1938), in holding that a state-law limitation on the size of a judgment could not be ignored.1 Similarly, the Court of Appeals *441correctly followed' Consorti in this case and considered whether the damages awarded materially deviated from damages awarded in similar cases. 66 F. 3d 427, 431 (CA2 1995). I endorse both opinions in these respects.

Although the majority agrees with the Court of Appeals that New York law establishes the size of the damages that may be awarded, it chooses to vacate and remand. The majority holds that a federal court of appeals should review for abuse of discretion a district court’s decision to deny a motion for new trial based on a jury’s excessive award. As a result, it concludes that the District Court should be given the opportunity to apply in the-first instance the “deviates materially” standard that New York law imposes. Ante, at 439.

The District Court had its opportunity to consider the propriety of the jury’s award, and it erred. The Court of Appeals has now corrected that error after “drawing all reasonable inferences in favor of” petitioner. 66 F. 3d, at 431. As there is no reason to suppose that the Court of Appeals has reached a conclusion with which the District Court could permissibly disagree on remand, I would not require the District Court to repeat a task that has already been well performed by the reviewing court. I therefore would affirm the judgment of the Court of Appeals.

r — <

Although I have addressed the question presented as if our decision in Erie alone controlled its outcome, petitioner argues that the second clause of the Seventh Amendment, which states that “no fact tried by jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law,” U. S. Const., Arndt. 7, *442bars the procedure followed by the Court of Appeals. There is no merit to that position.

Early cases do state that the Reexamination Clause prohibits appellate review of excessive jury awards, but they do not foreclose the practice altogether. See, e. g., Southern Railway-Carolina Div. v. Bennett, 233 U. S. 80, 87 (1914) (“It may be admitted that if it were true that the excess appeared as [a] matter of law; that if, for instance, the statute fixed a maximum and the verdict exceeded it, a question might arise for this court”); 11 C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure § 2820, pp. 207-209 (2d ed. 1995). Indeed, for the last 30 years, we have consistently reserved the question whether the Constitution permits such review, ante, at 434-435, and, in the meantime, every Court of Appeals has agreed that the Seventh Amendment establishes no bar. 11 Wright & Miller §2820, at 209.

Taking the question to be an open one, I start with certain basic principles. It is well settled that jury verdicts are not binding on either trial judges or appellate courts if they are unauthorized by law. A verdict may be insupportable as a matter of law either because of deficiencies in the evidence or because an award of damages is larger than permitted by law. If an award is excessive as a matter of law — in a diversity case if it is larger than applicable state law permits — a trial judge has a duty to set it aside. A failure to do so is an error of law that the court of appeals has a duty to correct on appeal.

These principles are sufficiently well established that no Seventh Amendment issue would arise if an appellate court ordered a new trial because a jury award exceeded a monetary cap on allowable damages. That New York has chosen to define its legal limit in less mathematical terms does not require a different constitutional conclusion.

New York’s limitation requires a legal inquiry that cannot be wholly divorced from the facts, but that quality does not necessarily make the question one for the factfinder rather *443than the reviewing court. Three times this Term we have assigned appellate courts the task of independently reviewing similarly mixed questions of law and fact. See Ornelas v. United States, 517 U. S. 690, 696-697 (1996); Markman v. Westview Instruments, Inc., 517 U. S. 370, 388-390 (1996); Thompson v. Keohane, 516 U. S. 90, 112-116 (1995). Such appellate review is proper because mixed questions require courts to construe all record inferences in favor of the fact-finder’s decision and then to determine whether, on the facts as found below, the legal standard has been met. See Orelas, 517 U. S., at 696-697 (quoting Pullman-Standard v. Swint, 456 U. S. 273, 289, n. 19 (1982)). In following that procedure here, the Court of Appeals did not reexamine any fact determined by a jury. 66 F. 3d, at 431. It merely identified that portion of the judgment that constitutes “unlawful excess.” See Dimick v. Schiedt, 293 U. S. 474, 486 (1935).2

Even if review by the Court of Appeals implicates the Reexamination Clause, it was “according to the rules of the common law.” U. S. Const., Arndt. 7. At common law, the trial judge sitting nisi prius recommended whether a judicial panel sitting en banc at Westminster should accept the jury’s award. The en banc court then ruled on the motion for new trial and entered judgment. 11 Wright & Miller §2819, at 203.

Petitioner correctly points out that under this procedure motions for new trial based on excessiveness were not technically subject to appellate review. Riddell, New Trial at the Common Law, 26 Yale L. J. 49, 57 (1916) (“It seems clear that in criminal as in civil cases, the trial Judge had not the *444power to grant a new trial, but that recourse must be had to ‘the Court above’”); id., at 60. However, because the nisi prius judge often did not serve on the en banc court, the “court above” was in essentially the same position as a modern court of appeals. It considered the legality of the jury’s award in light of the trial judge’s opinion, but without any firsthand knowledge of what had transpired below. See Blume, Review of Facts in Jury Cases — The Seventh Amendment, 20 J. Am. Jud. Soc. 130, 131 (1936).3

Petitioner also contends that at common law the en banc court could only grant a new trial if the trial judge so recommended. That contention is undermined by numerous cases in which the “court above” granted new trials without making any reference to the trial judge’s view of the damages. See, e. g., Honda Motor Co. v. Oberg, 512 U. S. 415, 422-425 (1994) (citing cases).4 Moreover, early English cases repeatedly state that the power to order a new trial when the jury returned an excessive award rested with “the Court,” rather than the judge below,5 and Blackstone identifies excessive *445damages as an independent basis on which the “court above” may grant a new trial but makes no mention of a requirement that the trial judge must so recommend. 3 W. Blackstone, Commentaries *387.

Even when read most favorably to petitioner, therefore, no meaningful distinction exists between the common-law practice by which the “court above” considered a new trial motion in the first instance, and the practice challenged here, by which an appellate court reviews a district court’s ruling on a new trial motion. See Riddell, 26 Yale L. J., at 57. As Justice Stone explained, in a dissenting opinion joined by Chief Justice Hughes, Justice Brandéis, and Justice Cardozo:

“[The Seventh Amendment], intended to endure for unnumbered generations, is concerned with substance and not with form. There is nothing in its history or language to suggest that the Amendment had any purpose but to preserve the essentials of the jury trial as it was known to the common law before the adoption of the Constitution. For that reason this Court has often refused to construe it as intended to perpetuate in changeless form the minutiae of trial practice as it existed in the English courts in 1791. From the beginning, its language has been regarded as but subservient to the single purpose of the Amendment, to preserve the essentials of the jury trial in actions at law, serving to distinguish them from suits in equity and admiralty, see Parsons v. Bedford, 3 Pet. 433, 446, and to safeguard the jury’s function from any encroachment which the common law did not permit.

*446“Thus interpreted, the Seventh Amendment guarantees that suitors in actions at law shall have the benefits of trial of issues of fact by a jury, but it does not prescribe any particular procedure by which these benefits shall be obtained, or forbid any which does not curtail the function of the jury to decide questions of fact as it did before the adoption of the Amendment. It does not restrict the court’s control of the jury’s verdict, as it had previously been exercised, and it does not confine the trial judge, in determining what issues are for the jury and what for the court, to the particular forms of trial practice in vogue in 1791.” Dimick v. Schiedt, 293 U. S., at 490-491.

Because the Framers of the Seventh Amendment evinced no interest in subscribing to every procedural nicety of the notoriously complicated English system, see Henderson, The Background of the Seventh Amendment, 80 Harv. L. Rev. 289, 290 (1966), the common-law practice certainly does not demonstrate that the Reexamination Clause prohibits federal appellate courts from ensuring compliance with state-law limits on jury awards.

Nor does early and intricate English history justify the more limited assertion that federal appellate courts must be limited to a particular, highly deferential standard of exces-siveness review. Common-law courts were hesitant to disturb jury awards, but less so in cases in which “a reasonably certain measure of damages is afforded.” 1 D. Graham, Law of New Trials in Cases Civil and Criminal 452 (2d ed. 1855); Washington, Damages in Contract at Common Law, 47 L. Q. Rev. 345, 363-364 (1931).

Here, New York has prescribed an objective, legal limitation on damages. If an appellate court may reverse a jury’s damages award when its own conscience has been shocked, 66 F. 3d, at 430, or its sense of justice outraged, Dagnello v. Long Island R. Co., 289 F. 2d 797, 802 (CA2 1961); cf. Honda Motor Co. v. Oberg, 512 U. S., at 422-424 (citing English *447cases), it may surely follow a sovereign’s command that it do so when a jury has materially deviated from awards granted by other juries. If anything, the New York standard, though less deferential, is more certain.6

III

For the reasons set forth above, I agree with the majority that the Reexamination Clause does not bar federal appellate courts from reviewing jury awards for excessiveness. I confess to some surprise, however, at its conclusion that “ ‘the influence — if not the command — of the Seventh Amendment,’ ” ante, at 432 (quoting Byrd v. Blue Ridge Rural Elec. Cooperative, Inc., 356 U. S. 525, 537 (1958) (footnote omitted)), requires federal courts of appeals to review district court applications of state-law excessiveness standards for an “abuse of discretion.” Ante, at 438.

The majority’s persuasive demonstration that New York law sets forth a substantive limitation on the size of jury awards seems to refute the contention that New York has merely asked appellate courts to reexamine facts. The majority’s analysis would thus seem to undermine the conclusion that the Reexamination Clause is relevant to this case.

Certainly, our decision in Byrd does not make the Clause relevant. There, we considered only whether the Seventh Amendment’s first clause should influence our decision to give effect to a state-law rule denying the right to a jury *448altogether. 356 U. S., at 537. That holding in no way requires us to consult the Amendment’s second clause to determine the standard of review for a district court’s application of state substantive law.

My disagreement is tempered, however, because the majority carefully avoids defining too strictly the abuse-of-discretion standard it announces. To the extent that the majority relies only on “practical reasons” for its conclusion that the Court of Appeals should give some weight to the District Court’s assessment in determining whether state substantive law has been properly applied, ante, at 438,1 do not disagree with its analysis.

As a matter of federal-court administration, we have recognized in other contexts the need for according some deference to the lower court’s resolution of legal, yet fact-intensive, questions. See Ornelas v. United States, 517 U. S., at 699; Pierce v. Underwood, 487 U. S. 552, 558, n. 1 (1988). Indeed, it is a familiar, if somewhat circular, maxim that deems an error of law an abuse of discretion.

In the end, therefore, my disagreement with the label that the majority attaches to the standard of appellate review should not obscure the far more fundamental point on which we agree. Whatever influence the Seventh Amendment may be said to exert, Erie requires federal appellate courts sitting in diversity to apply “the damage-control standard state law supplies.” Ante, at 438.

IV

Because I would affirm the judgment of the Court of Appeals, and because I do not agree that the Seventh Amendment in any respect influences the proper analysis of the question presented, I respectfully dissent.

Justice Scalia,

with whom The Chief Justice and Justice Thomas join, dissenting.

Today the Court overrules a longstanding and well-reasoned line of precedent that has for years prohibited fed*449eral appellate courts from reviewing refusals by district courts to set aside civil jury awards as contrary to the weight of the evidence. One reason is given for overruling these cases: that the Courts of Appeals have, for some time now, decided to ignore them. Such unreasoned capitulation to the nullification of what was long regarded as a core component of the Bill of Rights — the Seventh Amendment’s prohibition on appellate reexamination of civil jury awards— is wrong. It is not for us, much less for the Courts of Appeals, to decide that the Seventh Amendment’s restriction on federal-court review of jury findings has outlived its usefulness.

The Court also holds today that a state practice that relates to the division of duties between state judges and juries must be followed by federal courts in diversity cases. On this issue, too, our prior cases are directly to the contrary.

As I would reverse the judgment of the Court of Appeals, I respectfully dissent.

I

Because the Court and I disagree as to the character of the review that is before us, I recount briefly the nature of the New York practice rule at issue. Section 5501(c) of the N. Y. Civ. Prac. Law and Rules (CPLR) (McKinney 1995) directs New York intermediate appellate courts faced with a claim “that the award is excessive or inadequate and that a new trial should have been granted” to determine whether the jury’s award “deviates materially from what would be reasonable compensation.” In granting respondent a new trial under this standard, the Court of Appeals necessarily engaged in a two-step process. As it has explained the application of § 5501(c), that provision “requires the reviewing court to determine the range it regards as reasonable, and to determine whether the particular jury award deviates materially from that range.” Consorti v. Armstrong World Industries, Inc., 72 F. 3d 1003, 1013 (CA2 1995) (amended). The first of these two steps — the determination as to “rea*450sonable” damages — plainly requires the reviewing court to reexamine a factual matter tried by the jury: the appropriate measure of damages, on the evidence presented, under New York law. The second step — the determination as to the degree of difference between “reasonable” damages and the damages found by the jury (whether the latter “deviates materially” from the former) — establishes the degree of judicial tolerance for awards found not to be reasonable, whether at the trial level or by the appellate court. No part of this exercise is appropriate for a federal court of appeals, whether or not it is sitting in a diversity case.

A

Granting appellate courts authority to decide whether an award is “excessive or inadequate” in the manner of CPLR § 5501(c) may reflect a sound understanding of the capacities of modern juries and trial judges. That is to say, the people of the State of New York may well be correct that such a rule contributes to a more just legal system. But the practice of federal appellate reexamination of facts found by a jury is precisely what the People of the several States considered not to be good legal policy in 1791. Indeed, so fearful were they of such a practice that they constitutionally prohibited it by means of the Seventh Amendment.

That Amendment was Congress’s response to one of the principal objections to the proposed Constitution raised by the Anti-Federalists during the ratification debates: its failure to ensure, the right to trial by jury in civil actions in federal court. The desire for an explicit constitutional guarantee against reexamination of jury findings was explained by Justice Story, sitting as Circuit Justice in 1812, as having been specifically prompted by Article Ill’s conferral of “appellate Jurisdiction, both as to Law and Fact” upon the Supreme Court. “[0]ne of the most powerful objections urged against [the Constitution],” he recounted, was that this au*451thority “would enable that court, with or without a new jury, to re-examine the whole facts, which had been settled by a previous jury.” United States v. Wonson, 28 F. Cas. 745, 750 (No. 16,750) (CC Mass.).1

The second clause of the Amendment responded to that concern by providing that “[i]n [sjuits at common law ... no fact tried by a jury, shall be otherwise re-examined in any Court of the United States, than according to the rules of the common law.” U. S. Const., Arndt. 7. The Reexamination Clause put to rest “apprehensions” of “new trials by the appellate courts,” Wonson, 28 F. Cas., at 750, by adopting, in broad fashion, “the rules of the common law” to govern federal-court interference with jury determinations.2 The *452content of that law was familiar and fixed. See, e. g., ibid. (“[T]he common law here alluded to is not the common law of any individual state, (for it probably differs in all), but it is the common law of England, the grand reservoir of all our jurisprudence”); Dimick v. Schiedt, 293 U. S. 474, 487 (1935) (Seventh Amendment “in effect adopted the rules of the common law, in respect of trial by jury, as these rules existed in 1791”). It quite plainly barred reviewing courts from entertaining claims that the jury’s verdict was contrary to the evidence.

At common law, review of judgments was had only on writ of error, limited to questions of law. See, e. g., Wonson, supra, at 748; 3 W. Blackstone, Commentaries on the Laws of England 405 (1768) (“The writ of error only lies upon matter of law arising upon the face of the proceedings; so that no evidence is required to substantiate or support it”); 1 W. Holdsworth, History of English Law 213-214 (7th ed. 1956); cf. Ross v. Rittenhouse, 2 Dall. 160, 163 (Pa. 1792) (McKean, C. J.). That principle was expressly acknowledged by this Court as governing federal practice in Parsons v. Bedford, 3 Pet. 433 (1830) (Story, J.). There, the Court held that no error could be assigned to a district court’s refusal to allow transcription of witness testimony “to serve as a statement of facts in case of appeal,” notwithstanding the right to such transcription under state practices made applicable to federal courts by Congress. Id., at 443 (emphasis deleted). This was so, the Court explained, because “[t]he whole object” of the transcription was “to present the evidence here in order to establish the error of the verdict in matters of fact,” id., at 445 — a mode of review simply unavailable on writ of error, see id., at 446, 448. The Court concluded that Congress had not directed federal courts to follow state practices that would change “the effect or conclusiveness of the verdict of the jury upon the facts litigated at the trial,” id., at 449, because it had “the most serious doubts whether *453[that] would not be unconstitutional” under the Seventh Amendment, id., at 448.

“This is a prohibition to the courts of the United States to re-examine any facts tried by a jury in any other manner. The only modes known to the common law to reexamine such facts, are the granting of a new trial by the court where the issue was tried, or to which the record was properly returnable; or the award of a venire facias de novo, by an appellate court, for some error of law which intervened in the proceedings.

“[I]f the evidence were now before us, it would not be competent for this court to reverse the judgment for any error in the verdict of the jury at the trial . . . .” Id., at 447-449.

Nor was the common-law proscription on reexamination limited to review of the correctness of the jury’s determination of liability on the facts. No less than the existence of liability, the proper measure of damages “involves only a question of fact,” St. Louis, I. M. & S. R. Co. v. Craft, 237 U. S. 648, 661 (1915), as does a “motio[n] for a new trial based on the ground that the damages . . . are excessive,” Metropolitan R. Co. v. Moore, 121 U. S. 558, 574 (1887). As appeals from denial of such motions necessarily pose a factual question, courts of the United States are constitutionally forbidden to entertain them.

“No error of law appearing upon the record, this court cannot reverse the judgment because, upon examination of the evidence, we may be of the opinion that the jury should have returned a verdict for a less amount. If the jury acted upon a gross mistake of facts, or were governed by some improper influence or bias, the remedy therefore rested with the court below, under its gen*454eral power to set aside the verdict. . . . Whether [the refusal to exercise that power] was erroneous or not, our power is restricted by the Constitution to the determination of the questions of law arising upon the record. Our authority does not extend to a re-examination of facts which have been tried by the jury under instructions correctly defining the legal rights of parties. Parsons v. Bedford, [supra]....” Railroad Co. v. Fraloff 100 U. S. 24, 31-32 (1879).

This view was for long years not only unquestioned in our cases, but repeatedly affirmed.3

*455B

Respondent’s principal response to these cases, which is endorsed by Justice Stevens, see ante, at 443-445, is that our forebears were simply wrong about the English common law. The rules of the common-law practice incorporated in the Seventh Amendment, it is claimed, did not prevent judges sitting in an appellate capacity from granting a new trial on the ground that an award was contrary to the weight of the evidence. This claim simply does not withstand examination of the actual practices of the courts at common law. The weight of the historical record strongly supports the view of the common law taken in our early cases.

At common law, all major civil actions were initiated before panels of judges sitting at the courts of Westminster. Trial was not always held at the bar of the court, however. The inconvenience of having jurors and witnesses travel to Westminster had given rise to the practice of allowing trials to be held in the countryside, before a single itinerant judge. This nisi prius trial, as it was called, was limited to the jury’s deciding a matter of fact in dispute; once that was accomplished, the verdict was entered on the record which— along with any exceptions to the instructions or rulings of the nisi prius judge — was then returned to the en banc court at Westminster. See generally 1 Holdsworth, History of English Law, at 223-224, 278-282; G. Radcliffe & G. Cross, The English Legal System 90-91, 183-186 (3d ed. 1954). Requests for new trials were made not to the nisi prius judge, but to the en banc court, prior to further proceedings and entry of judgment. See 1 Holdsworth, supra, at 282; Riddell, New Trial at the Common Law, 26 Yale L. J. 49, 53, 57 (1916). Such motions were altogether separate from appeal on writ of error, which followed the entry of judg*456ment. 1 Holdsworth, supra, at 213-214; Radcliffe & Cross, supra, at 210-212.4

Nonetheless, respondent argues, the role of the en banc court at Westminster was essentially that of an appellate body, reviewing the proceedings below; and those appellate judges were capable of examining the evidence, and of granting a new trial when, in their view, the verdict was contrary to the weight of the evidence. See Blume, Review of Facts in Jury Cases — The Seventh Amendment, 20 J. Am. Jud. Soc. 130, 131 (1936); Riddell, supra, at 55-57, 60. There are two difficulties with this argument. The first is the characterization of the court at Westminster as an appellate body. The court’s role with respect to the initiation of the action, the entertaining of motions for new trial, and the entry of judgment was the same in all cases — whether the cause was tried at the bar or at nisi prius. To regard its actions in deciding a motion for a new trial as “appellate” in the latter instance supposes a functional distinction where none existed. The second difficulty is that when the trial had been held at nisi prius, the judges of the en banc court apparently would order a new trial only if the nisi prius judge certified that he was dissatisfied with the verdict. To be sure, there are many cases where no mention is made of the judge’s certificate, but there are many indications that it was a required predicate to setting aside a verdict rendered at nisi prius, and respondent has been unable to identify a single case where a new trial was granted in the absence of such certification. In short, it would seem that a new trial could not *457be had except upon the approval of the judge who presided over the trial and heard the evidence.5

I am persuaded that our prior cases were correct that, at common law, “reexamination” of the facts found by a jury could be undertaken only by the trial court, and that appellate review was restricted to writ of error which could challenge the judgment only upon matters of law. Even if there were some doubt on the point, we should be hesitant to advance our view of the common law over that of our forbears, who were far better acquainted with the subject than we are. But in any event, the question of how to apply the “rules of the common law” to federal appellate consideration of mo*458tions for new trials is one that has already been clearly and categorically answered, by our precedents. As we said in Dimick v. Schiedt, 293 U. S. 474 (1935), in discussing the status of remittitur under “the rules of the common law,” a doctrine that “has been accepted as the law for more than a hundred years and uniformly applied in the federal courts during that time” and “finds some support in the practice of the English courts prior to the adoption of the Constitution” will not lightly “be reconsidered or disturbed,” id., at 484-485. The time to question whether orders on motions for a new trial were in fact reviewable at common law has long since passed. Cases of this Court reaching back into the early 19th century establish that the Constitution forbids federal appellate courts to “reexamine” a fact found by the jury at trial; and that this prohibition encompasses review of a district court’s refusal to set aside a verdict as contrary to the weight of the evidence.

C

The Court, as is its wont of late, all but ignores the relevant history. It acknowledges that federal appellate review of district-court refusals to set aside jury awards as against the weight of the evidence was “once deemed inconsonant with the Seventh Amendment’s Reexamination Clause,” ante, at 434, but gives no indication of why ever we held that view; and its citation of only one of our eases subscribing to that proposition fails to convey how long and how clearly it was a fixture of federal practice, see ibid, (citing only Lincoln v. Power, 151 U. S. 436 (1894)). That our earlier cases are so poorly recounted is not surprising, however, given the scant analysis devoted to the conclusion that “appellate review for abuse of discretion is reconcilable with the Seventh Amendment,” ante, at 435.

No precedent of this Court affirmatively supports that proposition. The cases upon which the Court relies neither *459affirmed nor rejected the practice of appellate weight-of-the-evidence review that has been adopted by the courts of appeals — a development that, in light of our past cases, amounts to studied waywardness by the intermediate appellate bench. Our unaccountable reluctance, in Grunenthal v. Long Island R. Co., 393 U. S. 156, 158 (1968), and Neese v. Southern R. Co., 350 U. S. 77 (1955), to stand by our precedents, and the undeniable illogic of our disposition of those two cases — approving ourselves a district-court denial of a new trial motion, so as not to have to confront the lawfulness of reversal by the court of appeals — is authority of only the weakest and most negative sort. Nor can any weight be assigned to our statement in Browning-Ferris Industries of Vt., Inc. v. Kelco Disposal, Inc., 492 U. S. 257, 279 (1989), seemingly approving appellate abuse-of-discretion review of denials of new trials where punitive damages are claimed to be excessive. Browning-Ferris, like Grunenthal and Neese, explicitly avoided the question that is before us today, see 492 U. S., at 279, n. 25. Even more significantly, Browning-Ferris involved review of a jury’s punitive damages award. Unlike the measure of actual damages suffered, which presents a question of historical or predictive fact, see, e. g., Craft, 237 U. S., at 661, the level of punitive damages is not really a “fact” “tried” by the jury. In none of our cases holding that the Reexamination Clause prevents federal appellate review of claims of excessive damages does it appear that the damages had a truly “punitive” component.

In any event, it is not this Court’s statements that the Court puts forward as the basis for dispensing with our prior cases. Rather, it is the Courts of Appeals’ unanimous “agree[ment]” that they may review trial-court refusals to set aside jury awards claimed to be against the weight of the evidence. Ante, at 435. This current unanimity is deemed controlling, notwithstanding the “relatively late” origin of the practice, ante, at 434, and without any inquiry into the *460reasoning set forth in those Court of Appeals decisions.6 The Court contents itself with citations of two federal appellate cases and the assurances of two leading treatises that the view (however meager its intellectual provenance might be) is universally held. See ante, at 435-436. To its credit, one of those treatises describes the “dramatic change in doctrine” represented by appellate abuse-of-discretion review of denials of new trial orders generally as having been “accomplished by a blizzard of dicta” that, through repetition alone, has “given legitimacy to a doctrine of doubtful constitutionality.” 11 C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure §2819, pp. 200, 204 (2d ed. 1995).7

The Court’s only suggestion as to what rationale might underlie approval of abuse-of-discretion review is to be found in a quotation from Dagnello v. Long Island R. Co., 289 F. 2d 797 (CA2 1961), to the effect that review of denial of a new trial motion, if conducted under a sufficiently deferential standard, poses only “‘a question of law.’” Ante, at 435 (quoting Dagnello, supra, at 806). But that is not the test that the Seventh Amendment sets forth. Whether or not it *461is possible to characterize an appeal of a denial of new trial as raising a “legal question,” it is not possible to review such a claim without engaging in a “reexamin[ation]” of the “facts tried by the jury” in a manner “otherwise” than allowed at common law. Determining whether a particular award is excessive requires that one first determine the nature and extent of the harm — which undeniably requires reviewing the facts of the case. That the court’s review also entails application of a legal standard (whether “shocks the conscience,” “deviates materially,” or some other) makes no difference, for what is necessarily also required is reexamination of facts found by the jury.

In the last analysis, the Court frankly abandons any pretense at faithfulness to the common law, suggesting that “the meaning” of the Reexamination Clause was not “fixed at 1791,” ante, at 436, n. 20, contrary to the view that all our prior discussions of the Reexamination Clause have adopted, see supra, at 451-454. The Court believes we can ignore the very explicit command that “no fact tried by a jury shall be otherwise reexamined in any Court of the United States, than according to the rules of the common law” because, after all, we have not insisted that juries be all male, or consist of 12 jurors, as they were at common law. Ante, at 436, n. 20. This is a desperate analogy, since there is of course no comparison between the specificity of the command of the Reexamination Clause and the specificity of the command that there be a “jury.” The footnote abandonment of our traditional view of the Reexamination Clause is a major step indeed.8

*462HH ► — I

The Court’s holding that federal courts of appeals may review district-court denials of motions for new trials for error of fact is not the only novel aspect of today’s decision. The Court also directs that the case be remanded to the District Court, so that it may “test the jury’s verdict against CPLR §5501(c)’s 'deviates materially’ standard.” Ante, at 439. This disposition contradicts the principle that “[t]he proper role of the trial and appellate courts in the federal system in reviewing the size of jury verdicts is ... a matter of federal law.” Donovan v. Penn Shipping Co., 429 U. S. 648, 649 (1977) (per curiam).

The Court acknowledges that state procedural rules cannot, as a general matter, be permitted to interfere with the allocation of functions in the federal court system, see ante, at 436-437. Indeed, it is at least partly for this reason that the Court rejects direct application of § 5501(c) at the appellate level as inconsistent with an “ 'essential characteristic’ ” of the federal court system — by which the Court presumably means abuse-of-discretion review of denials of motions for new trials. See ante, at 431, 437-438. But the scope of the Court’s concern is oddly circumscribed. The “essential characteristic” of the federal jury, and, more specifically, the role of the federal trial court in reviewing jury judgments, apparently counts for little. The Court approves the “ac-*463commodat[ion]” achieved by having district courts review jury verdicts under the “deviates materially” standard, because it regards that as a means of giving effect to the State’s purposes “without disrupting the federal system,” ante, at 437. But changing the standard by which trial judges review jury verdicts does disrupt the federal system, and is plainly inconsistent with the “strong federal policy against allowing state rules to disrupt the judge-jury relationship in the federal court.” Byrd v. Blue Ridge Rural Elec. Cooperative, Inc., 356 U. S. 525, 538 (1958).9 The Court’s opinion does not even acknowledge, let alone address, this dislocation.

We discussed precisely the point at issue here in Browning-Ferris Industries of Vt., Inc. v. Kelco Disposal, Inc., 492 U. S. 257 (1989), and gave an answer altogether contrary to the one provided today. Browning-Ferris rejected a request to fashion a federal common-law rule limiting the size of punitive damages awards in federal courts, reaffirming the principle of Erie R. Co. v. Tompkins, 304 U. S. 64 (1938), that “ [i]n a diversity action, or in any other lawsuit where state law provides the basis of decision, the propriety of an award of punitive damages ..., and the factors the jury may consider in determining their amount, are questions of state law.” 492 U. S., at 278. But the opinion expressly stated that “[fjederal law . . . will control on those issues involving the proper review of the jury award by a federal district court and court of appeals.” Id., at 278-279. “In reviewing an award of punitive damages,” it said, “the role of the district court is to determine whether the jury’s verdict is within the confines set by state law, and to determine, by reference to federal standards developed under Rule 59, whether a new trial or remittitur should be ordered.” Id., at 279. The same distinction necessarily applies where the *464judgment under review is for compensatory damages: State substantive law controls what injuries are compensable and in what amount; but federal standards determine whether the award exceeds what is lawful to such degree that it may be set aside by order for new trial or remittitur.10

The Court does not disavow those statements in Browning-Ferris (indeed, it does not even discuss them), but it presumably overrules them, at least where the state rule that governs “whether a new trial or remittitur should be ordered” is characterized as “substantive” in nature. That, at any rate, is the reason the Court asserts for giving § 5501(c) dispositive effect. The objective of that provision, the Court states, “is manifestly substantive,” ante, at 429, since it operates to “contro[l] how much a plaintiff can be awarded” by “tightening the range of tolerable awards,” ante, at 425, 426. Although “less readily classified” as substantive than “a statutory cap on damages,” it nonetheless “was designed to provide an analogous control,” ante, at 428, 429, by making a new trial mandatory when the award “deviates] materially” from what is reasonable, see ante, at 428-429.

I do not see how this can be so. It seems to me quite wrong to regard this provision as a “substantive” rule for Erie purposes. The “analog[y]” to “a statutory cap on damages,” ante, at 428, 429, fails utterly. There is an absolutely fundamental distinction between a rule of law such as that, which would ordinarily be imposed upon the jury in the trial court’s instructions, and a rule of review, which simply determines how closely the jury verdict will be scrutinized for *465compliance with the instructions. A tighter standard for reviewing jury determinations can no more plausibly be called a “substantive” disposition than can a tighter appellate standard for reviewing trial-court determinations. The one, like the other, provides additional assurance that the law has been complied with; but the other, like the one, leaves the law unchanged.

The Court commits the classic Erie mistake of regarding whatever changes the outcome as substantive, see ante, at 428-431. That is not the only factor to be considered. See Byrd, supra, at 537 (“[W]ere ‘outcome’ the only consideration, a strong case might appear for saying that the federal court should follow the state practice. But there are affirmative countervailing considerations at work here”). Outcome determination “was never intended to serve as a talisman,” Hanna v. Plumer, 380 U. S. 460, 466-467 (1965), and does not have the power to convert the most classic elements of the process of assuring that the law is observed into the substantive law itself. The right to have a jury make the findings of fact, for example, is generally thought to favor plaintiffs, and that advantage is often thought significant enough to be the basis for forum selection. But no one would argue that Erie confers a right to a jury in federal court wherever state courts would provide it; or that, were it not for the Seventh Amendment, Erie would require federal courts to dispense with the jury whenever state courts do so.

In any event, the Court exaggerates the difference that the state standard will make. It concludes that different outcomes are likely to ensue depending on whether the law being applied is the state “deviates materially” standard of § 5501(c) or the “shocks the conscience” standard. See ante, at 429-430. Of course it is not the federal appellate standard but the federal district-court standard for granting new trials that must be compared with the New York standard to determine whether substantially different results will obtain — and it is far from clear that the district-court standard *466ought to be “shocks the conscience.”11 Indeed, it is not even clear (as the Court asserts) that “shocks the conscience” is the standard (erroneous or not) actually applied by the district courts of the Second Circuit. The Second Circuit’s test for reversing a grant of a new trial for an excessive verdict is whether the award was “clearly within the maximum limit of a reasonable range,” Ismail v. Cohen, 899 F. 2d 183, 186 (CA2 1990) (internal quotation marks omitted), so any district court that uses that standard will be affirmed. And while many district-court decisions express the “shocks the conscience” criterion, see, e. g., Koerner v. Club Mediterranee, S. A., 833 F. Supp. 327, 333 (SDNY 1993), some have used a standard of “indisputably egregious,” Banff v. Express, Inc., 921 F. Supp. 1065, 1069 (SDNY 1995), or have adopted the inverse of the Second Circuit’s test for reversing a grant of new trial, namely, “clearly outside the maximum limit of a reasonable range,” Paper Corp. v. Schoeller Technical Papers, Inc., 807 F. Supp. 337, 350-351 (SDNY 1992). Moreover, some decisions that say “shocks the conscience” in fact apply a rule much less stringent. One case, for example, says that any award that would not be sustained under the New York “deviates materially” rule “shocks the conscience.” See In re Joint Eastern & S. Dist. Asbestos Litigation, 798 F. Supp. 925, 937 (E&SDNY 1992), rev’d on other grounds, 995 F. 2d 343, 346 (CA2 1993). In sum, it is at least highly questionable whether the consistent outcome differential claimed by the Court even exists. What seems to me far more likely to produce forum shopping is the consistent difference between the state and federal appellate standards, which the Court leaves untouched. Under the Court’s *467disposition, the Second Circuit reviews only for abuse of discretion, whereas New York’s appellate courts engage in a de novo review for material deviation, giving the defendant a double shot at getting the damages award set aside. The only result that would produce the conformity the Court erroneously believes Erie requires is the one adopted by the Second Circuit and rejected by the Court: de novo federal appellate review under the § 5501(c) standard.

To say that application of § 5501(c) in place of the federal standard will not consistently produce disparate results is not to suggest that the decision the Court has made today is not a momentous one. The principle that the state standard governs is of great importance, since it bears the potential to destroy the uniformity of federal practice and the integrity of the federal court system. Under the Court’s view, a state rule that directed courts “to determine that an award is excessive or inadequate if it deviates in any degree from the proper measure of compensation” would have to be applied in federal courts, effectively requiring federal judges to determine the amount of damages de novo, and effectively taking the matter away from the jury entirely. Cf. Byrd, 356 U. S., at 537-538. Or consider a state rule that allowed the defendant a second trial on damages, with judgment ultimately in the amount of the lesser of two jury awards. Cf. United States v. Wonson, 28 F. Cas., at 747-748 (describing Massachusetts practice by which a second jury trial could be had on appeal). Under the reasoning of the Court’s opinion, even such a rule as that would have to be applied in the federal courts.

The foregoing describes why I think the Court’s Erie analysis is flawed. But in my view, one does not even reach the Erie question in this case. The standard to be applied by a district court in ruling on a motion for a new trial is set forth in Rule 59 of the Federal Rules of Civil Procedure, which provides that “[a] new trial may be granted ... for any of the reasons for which new trials have heretofore been granted in *468actions at law in the courts of the United States.” (Emphasis added.) That is undeniably a federal standard.12 Federal District Courts in the Second Circuit have interpreted that standard to permit the granting of new trials where “ ‘it is quite clear that the jury has reached a seriously erroneous result’ ” and letting the verdict stand would result in a “ ‘miscarriage of justice.’ ” Koerner v. Club Mediterranee, S. A., supra, at 331 (quoting Bevevino v. Saydjari, 574 F. 2d 676, 684 (CA2 1978)). Assuming (as we have no reason to question) that this is a correct interpretation of what Rule 59 requires, it is undeniable that the Federal Rule is “‘sufficiently broad’ to cause a ‘direct collision’ with the state law or, implicitly, to ‘control the issue’ before the court, thereby leaving no room for the operation of that law.” Burlington Northern R. Co. v. Woods, 480 U. S. 1, 4-5 (1987). It is simply not possible to give controlling effect both to the federal standard and the state standard in reviewing the jury’s award. That being so, the court has no choice but to apply the Federal Rule, which is an exercise of what we have called Congress’s “power to regulate matters which, though falling within the uncertain area between substance and procedure, are rationally capable of classification as either,” Hanna, 380 U. S., at 472.

* * *

There is no small irony in the Court’s declaration today that appellate review of refusals to grant new trials for error of fact is “a control necessary and proper to the fair adminis*469tration of justice,” ante, at 435. It is objection to precisely that sort of “control” by federal appellate judges that gave birth to the Reexamination Clause of the Seventh Amendment. Alas, those who drew the Amendment, and the citizens who approved it, did not envision an age in which the Constitution means whatever this Court thinks it ought to mean — or indeed, whatever the courts of appeals have recently thought it ought to mean.

When there is added to the revision of the Seventh Amendment the Court’s precedent-setting disregard of Congress’s instructions in Rule 59, one must conclude that this is a bad day for the Constitution’s distinctive Article III courts in general, and for the role of the jury in those courts in particular. I respectfully dissent.

*494 Me. Justice Reed

delivered the opinion of the Court.

The principal question in this case is whether in diversity cases the federal courts must follow conflict of laws rules prevailing in the states in which they sit. We left this open in Ruhlin v. New York Life Insurance Co., 304 U. S. 202, 208, n. 2. The frequent recurrence of the problem, as well as the conflict of approach to the problem between the Third Circuit’s' opinion here and that of the First Circuit in Sampson v. Channell, 110 F. 2d 754, 759-62, led us to grant certiorari.

In 1918, respondent, a New York corporation, transferred its entire business to petitioner, a Delaware corporation. Petitioner contracted to use its best efforts to further the manufacture and sale of certain patented devices covered by the agreement, and respondent was to have a share of petitioner’s profits. The agreement was executed in New York, the assets were transferred there,' and petitioner began performance there although later it moved its operations to other states. Respondent.was voluntarily dissolved under New York law in ‘1919. Ten years later it instituted this action in the United States District Court for the District of Delaware, alleging that petitioner had failed to perform its agreement to use its best efforts. Jurisdiction rested on diversity of citizenship. In 1939 respondent recovered a jury verditít of $100,000, upon which judgment was entered. Respondent then moved to correct the judgment by adding in *495 terest at the rate of six percent from June 1, 1929, the date the action had been brought. The basis of the motion was the-provision in § 480 of the New York Civil Practice Act directing that in contract actions interest be added to the principal sum “whether theretofore liquidated or unliquidated.” 1 The District Court granted the motion, taking the view that the rights of the parties were governed by New York law and that under New York law the addition of such interest was mandatory. 30 F. Supp. 425, 431. The Circuit Court of Appeals affirmed, 115 F. 2d 268, and we granted certiorari, limited to the question whether § 480 of the New York Civil Practice Act is applicable to an action in the federal court in Delaware. 312 U. S. 674.

The Circuit Court of Appeals was of the view that under New York law the right to interest before verdict under § 480 went to the substance of the obligation, and that proper construction of the contract in suit fixed New York as the place of performance. It then concluded that § 480 was applicable to the case because “it is clear by what we think is undoubtedly the better view of the law that the rules for ascertaining the measure of damages are not a matter of procedure at all, but are *496 matters of substance which should be settled by reference to the law of the appropriate state according to the type of case being tried in the forum. The measure of damages for breach of a contract is determined by the law of the place of performance; Restatement, Conflict of Laws § 413.” The court referred also to § 418 of the Restatement, which makes interest part of the damages to be determined by the law of the place of performance. Application of the .New York statute apparently followed from the court’s independent determination of the “better view” without regard to Delaware law, for no Delaware decision or statute was cited or discussed.

We are of opinion that the prohibition declared in Erie R. Co. v. Tompkins, 304 U. S. 64, against such independent determinations by the federal courts, extends to the field of conflict of laws. The conflict of laws rules to be applied by the federal court in Delaware must conform to those prevailing in Delaware’s state courts. 2 Otherwise, the accident of diversity of citizenship would constantly disturb equal administration of justice in coordinate state and federal courts sitting side by side. See Erie R. Co. v. Tompkins, supra, at 74-77. Any other ruling would do violence to the principle of uniformity within a state, upon which the' Tompkins decision is based. Whatever lack of uniformity this may produce between federal courts in different states is attributable to our federal system, which leaves to a state, within the limits permitted by the Constitution, the right to pursue local policies diverging from those of its neighbors. It is not for the federal courts to thwart such local policies by enforcing an independent '“general law” of conflict of laws. Subject only to review by this Góurt' *497 on any. federal question that may arise, Delaware is free to determine whether a given matter is to be governed by the law of the forum or some other law. Cf. Milwaukee County v. White Co., 296 U. S. 268, 272. This Court’s views are not the decisive factor in determining the applicable conflicts rule. Cf. Funkhouser v. J. B. Preston Co., 290 U. S. 163. And the proper function of the Delaware federal court is to ascertain what the state law is, not what it ought to be.

Besides these general considerations, the traditional treatment of interest in diversity eases brought in the federal courts points to the same conclusion. Section 966 of the Revised Statutes, 28 U. S. C. § 811, relating to interest on judgments, provides that it be. calculated from the date of judgment at such rate as is allowed by law on judgments recovered in the courts of the state in which the court is held; In Massachusetts Benefit Association v. Miles, 137 U. S. 689, this Court held that § 966 did not exclude the allowance of interest on verdicts as well as. judgments, and the opinion observed that “the courts of the state and the federal courts sitting within the state should be in harmony upon this point” (p. 691).

Looking then to the Delaware cases, petitioner relies on one group to support his contention that the Delaware state courts would refuse, to apply § 480 of the New York Civil Practice Act, and respondent on another to prove the contrary. We make no analysis of these Delaware decisions, but leave this for the Circuit Court of Appeals when the case is remanded.

Respondent makes the further argument that the judgment must be affirmed because, under the full faith and credit clause of the Constitution, the state courts of Delaware would be obliged to give effect to'the -New York statute. The argument rests mainly on the decision of this Court in John Hancock Mutual Life Ins. Co. v. Yates, *498 299 U. S. 178, where a New York statute was held such an integral part of a contract of insurance, that Georgia was compelled to sustain the contract under the full faith and credit clause. Here, however, § 480 of the New York Civil Practice Act is in no way related to the validity of the contract in suit, but merely to an incidental item of damages, interest, with respect to which courts at the forum have commonly been free to apply their own or some other law as they see fit. Nothing in the Constitution ensures unlimited extraterritorial recognition of all statutes or- of any statute under all circumstances. Pacific Employers Insurance Co. v. Industrial Accident Comm’n, 306 U. S. 493; Kryger v. Wilson, 242 U. S. 171. The full -faith and credit clause does not go so far as to compel Delaware to apply § 480 if such application would interfere with, its local policy.

Accordingly, the judgment is reversed and the case remanded to the Circuit Court of Appeals for decision in conformity with the law of Delaware.

Reversed.

Coleman, J.

This products liability case arose from a fatality automobile accident involving Oregon residents traveling through southeastern Washington. Goodyear Tire & Rubber Co. manufactured the components of a wheel assembly that separated from an oncoming truck and caused the fatal injury. Goodyear appeals a judgment on a jury verdict. On appeal, Goodyear contends that the trial court erred when it declined to apply Oregon’s statute of repose, which would have barred the claims asserted against Goodyear in this case. We conclude that the trial court correctly applied Washington law. We also reject Goodyear’s contention that there was insufficient evidence produced at trial to support the jury’s determination that the useful safe life of the product had not expired. Goodyear also challenges several evidentiary rulings made by the trial court. We find no reversible error and affirm.

FACTS

On May 27, 1997, Larry and Diana Martin were driving westbound on SR 12 in Walla Walla County when a large metal ring flew through the windshield of their car and struck Mrs. Martin in the head. The source of the metal ring was a commercial truck, owned by Humbert Construction, an Oregon company, that was heading eastbound on SR 12. Before coming off the truck, the metal ring, known as a side ring, had been part of a dual-tire wheel assembly. The wheel assembly consisted of side-by-side rubber tires, each mounted on a metal wheel rim and held in place by a side ring. When the tire is inflated, the side ring engages *827with the rim’s “gutter” to secure the tire and inner tube to the rim. A small gap on the C-shaped side ring facilitates installation. When that gap expands and the ends of the ring are too far apart to properly secure the tire, the side ring is “sprung” and should be discarded.

The accident occurred when the inner tire on the truck went flat and the loss of air pressure caused the inner side ring to separate from the wheel rim. The side ring detached from the axle and ricocheted off the road and into the Martins’ car. It passed through the windshield, hit Mrs. Martin’s head as she sat in the passenger seat, and exited through the rear window. Mr. Martin, who was driving, was not injured other than minor scratches from the broken glass.

At the time of the accident, the truck was hauling a trailer loaded with rock from an Oregon quarry to a destination in Washington. The trailer was overloaded, carrying 8,800 pounds per axle over the legal limit. It was weighed prior to leaving Oregon by Humbert’s driver/ operator and after the accident by the Washington State Patrol. The side ring that killed Mrs. Martin was manufactured no later than January 1956, thus it was at least 41 years old at the time of the accident. The wheel rim that it had been attached to was manufactured no later than 1973, 24 years before the accident. Both were manufactured and designed in Ohio or Michigan by Goodyear Tire & Rubber Co., an Ohio corporation.

Larry Martin filed a wrongful death action in King County Superior Court, alleging that both Humbert and Goodyear were liable for his wife’s death under Washington law on theories of negligence and product liability. Martin’s claims against Goodyear were based upon the theory that the side ring on Humbert’s truck was defectively designed such that it created an unreasonable risk of accidental separation. Later versions of the side ring were designed with a locking mechanism that prevented accidental separation. Martin alleged that Humbert was at fault for Mrs. *828Martin’s death because Humbert had been negligent in its maintenance and operation of the truck and trailer.

Humbert settled with Martin just before trial. The case proceeded to trial on Martin’s claims against Goodyear. A jury found in Martin’s favor and allocated 67 percent of the fault for the accident to Goodyear and 33 percent to Humbert.

ANALYSIS

Statute of Repose

Goodyear claims that the trial court erroneously applied Washington law to Martin’s products liability claims. Goodyear argues that the trial court should have applied Oregon’s statute of repose, which immunizes manufacturers from products liability claims brought more than eight years after delivery of the product. Application of Oregon law would have resulted in dismissal of Martin’s products liability claims on summary judgment based upon the age of the wheel assembly components.

“To engage in a choice of law determination, there must first be an actual conflict between the laws or interests of Washington and the laws or interests of another state.” Rice v. Dow Chem. Co., 124 Wn.2d 205, 210, 875 P.2d 1213 (1994). The law at issue here is the statute of repose applicable to products liability claims. Washington’s statute of repose, RCW 7.72.060(2), provides a rebuttable presumption that a product’s useful safe life expires 12 years after delivery. A manufacturer will not be liable for harm that occurs after the useful safe life expires. RCW 7.72.060(l)(a). The useful safe life is the amount of time that a product would normally be likely to perform or be stored in a safe manner. RCW 7.72.060(l)(a). In contrast, Oregon’s statute of repose, Or. Rev. Stat. § 30.905(1), extinguishes all products liability claims eight years after the product is delivered. Whether Martin has a viable products liability claim against Goodyear depends on which state’s law applies because the age of the wheel assembly exceeds eight years. *829There is, therefore, an actual conflict between Washington and Oregon law that requires us to engage in a choice of law analysis.

In choice of law cases, Washington courts apply the “most significant relationship” test, set forth in the Restatement (Second) of Conflict of Laws § 145 (1971). Johnson v. Spider Staging Corp., 87 Wn.2d 577, 580, 555 P.2d 997 (1976). Section 145 provides:

(1) The rights and liabilities of the parties with respect to an issue in tort are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties under the principles stated in § 6.[1]

(2) Contacts to be taken into account in applying the principles of § 6 to determine the law applicable to an issue include:

(a) the place where the injury occurred,

(b) the place where the conduct causing the injury occurred,

(c) the domicil, residence, nationality, place of incorporation and place of business of the parties, and

(d) the place where the relationship, if any, between the parties is centered.

These contacts are to be evaluated according to their relative importance with respect to the particular issue.

In personal injury cases, the law of the state where the injury occurred applies unless another state has a greater interest in determination of that particular issue. Bush v. O’Connor, 58 Wn. App. 138, 143-44, 791 P.2d 915, 918, 919 *830(1990). The Restatement (Second) of Conflict of Laws § 146 (1971) provides:

In an action for a personal injury, the local law of the state where the injury occurred determines the rights and liabilities of the parties, unless, with respect to the particular issue, some other state has a more significant relationship under the principles stated in § 6 to the occurrence and the parties, in which event the local law of the other state will be applied.

Restatement (Second) of Conflict of Laws § 146 (cited in Bush, 58 Wn. App. at 144). Oregon courts follow the same presumption. See Myers v. Cessna Aircraft Corp., 275 Or. 501, 514-15, 553 P.2d 355, 367 (1976) (wrongful death).

Notwithstanding this presumption, Goodyear argues that Oregon’s statute of repose should apply because of the number of parties and events associated with this accident that are based in Oregon. It notes the following Oregon contacts: an Oregon company, Humbert, owned and operated the wheel assembly at issue; Humbert maintained and installed the wheel assembly in Oregon; and Humbert overloaded and weighed the trailer in Oregon. Goodyear also highlights the Martins’ contacts with Oregon — they were Oregon residents, were traveling home to Oregon at the time of the accident, and Mrs. Martin’s estate and beneficiaries are all located in Oregon.

But we must evaluate the contacts both quantitatively and qualitatively, based upon the location of the most significant contacts as they relate to the particular issue at hand — the statute of repose. Spider Staging, 87 Wn.2d at 581. Goodyear’s arguments in favor of Oregon law rely heavily on acts and omissions committed by Humbert, but Humbert’s acts and omissions are not relevant to this inquiry. Mentry v. Smith, 18 Wn. App. 668, 571 P.2d 589 (1977). Instead, we must focus on the contacts pertinent to the products liability claims against Goodyear.

Although there are no Washington residents involved in this case, the mere presence of an Oregon plaintiff does not persuade us that Oregon law applies with respect *831to the products liability claims against Goodyear. The section 145 contacts in this case are:

a) Larry and Diana Martin were Oregon residents at the time of the accident.

b) Goodyear is an Ohio corporation that does business in all fifty states.

c) Humbert is an Oregon corporation that bases its business in Oregon and conducts business in Washington. It has a registered agent in Walla Walla.

d) At the time of the accident, Humbert’s truck was transporting a load of rock from Oregon to a destination in Washington.

e) The wheel assembly at question was likely designed and manufactured in Ohio and Michigan. It is unknown how or when Humbert acquired it.

f) The accident occurred on SR 12 in Walla Walla County.

g) There is no relationship between the parties that existed prior to the accident.

The Martins were Oregon residents, but their injuries arose from an accident that took place in Washington.2 The tortfeasor, Goodyear, is an Ohio corporation that does business in all 50 states. It had no prior contact with the Martins. There was no evidence that the wheel assembly in question entered the stream of commerce or was manufactured or designed in Washington or Oregon. The number of contacts with Washington in this case is not overwhelming, but the fact that Goodyear’s product caused injury in Washington is qualitatively significant. Moreover, Goodyear’s contacts with Oregon with respect to this particular issue are virtually nonexistent. Where no injury or *832injury-causing conduct occurred in Oregon and the non-Oregon defendant has not identified any particular contacts with Oregon other than the fact that its product was ultimately purchased and used by an Oregon resident who is not the injured party in this case, we do not find that Oregon’s contacts exceed Washington’s. Goodyear cites several products cases involving multistate trips where the law of the home state was applied, but all of those cases involve parties who established relationships with the defective product in their home states, well before any accident occurred. See Bonti v. Ford Motor Co., 898 F. Supp. 391 (S.D. Miss. 1995); Phillips v. Gen. Motors Corp., 2000 MT 55, 298 Mont. 438, 995 P.2d 1002 (plaintiffs purchased defective vehicle in home state); and Frosty v. Textron, Inc., 891 F. Supp. 551 (D. Or. 1995) (helicopter accident where Oregon pilot died in Washington). When some aspect of that preexisting relationship is at issue, courts are less likely to apply the law of the state where the accident happened to occur. This case differs from the cases cited by Goodyear because the Martins never had a preexisting relationship with Goodyear.

In contrast, where a defendant’s violation of the local tort laws or rules of the road is at issue, courts tend to apply the law of the injury state, even if only one or neither of the parties is a resident. See Ellis v. Barto, 82 Wn. App. 454, 458-59, 918 P.2d 540 (1996) (Idaho law applies to two-car accident in Idaho between Washington residents visiting Coeur d’Alene for one day); Jones v. Cook, 587 So. 2d 570 (Fla. Dist. Ct. App. 1991) (Georgia law applies to two-car accident in Georgia between Florida residents); Levario v. Motorists Mut. Ins. Co., 109 Ohio App. 3d 451, 672 N.E.2d 672 (1996) (under the section 146 presumption, Michigan law applied when an Ohio motorist driving through Michigan was injured by a piece of metal that flew through her windshield after falling off an unidentified truck). Furthermore, in the above-cited cases, the courts relied on the interests to be served in applying a state’s law on a particular issue. We, too, must analyze the principles be*833hind the statute of repose to determine which state’s interests will prevail. Spider Staging, 87 Wn.2d at 582.

Here, Washington and Oregon adopted their respective statutes of repose in 1981 and 1977 in response to identical stimuli — concerns from local businesses and manufacturers about the high cost of liability insurance. Oregon’s statute of repose, Or. Rev. Stat. § 30.905, shortened the time for filing a products liability lawsuit to eight years from delivery of the product to the end user. Shasta View Irrigation Dist. v. Amoco Chems. Corp., 329 Or. 151, 163, 986 P.2d 536, 542 (1999). The intent was to prevent stale claims and to provide greater certainty to manufacturers (and their insurers) by limiting the time for filing a products liability lawsuit. Shasta View, 329 Or. at 163.

Washington’s statute of repose, adopted as part of the tort reform act of 1981, adopts a more consumer-friendly approach. The time period for bringing a products liability suit under Washington’s statute of repose is based upon a product’s “useful safe life,” which presumes that a particular product may be safely used for up to 12 years. ROW 7.72.060. A claimant may rebut this presumption by a preponderance of the evidence that the useful safe life exceeds 12 years. Rice, 124 Wn.2d at 212. The preamble of the tort reform act explains the reasons for adopting this rebuttable presumption:

“The purpose of this amendatory act is to enact farther reforms in the tort law to create a fairer and more equitable distribution of liability among parties at fault.

“Of particular concern is the area of tort law known as product liability law. Sharply rising premiums for product liability insurance have increased the cost of consumer and industrial goods. These increases in premiums have resulted in disincentives to industrial innovation and the development of new products. High product liability premiums may encourage product sellers and manufacturers to go without liability insurance or pass the high cost of insurance on to the consuming public in general.

“It is the intent of the legislature to treat the consuming public, the product seller, the product manufacturer, and the *834product liability insurer in a balanced fashion in order to deal with these problems.

“It is the intent of the legislature that the right of the consumer to recover for injuries sustained as a result of an unsafe product not be unduly impaired. It is further the intent of the legislature that retail businesses located primarily in the state of Washington be protected from the substantially increasing product liability insurance costs and unwarranted exposure to product liability litigation.”

Brewer v. Fibreboard Corp., 127 Wn.2d 512, 521, 901 P.2d 297 (1995) (quoting Preamble, Laws of 1981, ch. 27, § 1) (some emphasis omitted). The legislative choices made in Oregon and Washington reflect similar concerns for protecting businesses and manufacturers from high liability insurance premiums and the risk of stale claims, but Washington law clearly provides greater protection for persons injured by defective products. Oregon’s statute is concerned primarily with protecting Oregon businesses and manufacturers doing business in Oregon. In some cases, that protection comes at the expense of injured persons, but that is a policy choice made by the Oregon legislature.

Goodyear’s argument that the Martins are not entitled to the protections of Washington law necessarily presumes that Goodyear was intended to benefit from the protections of Oregon’s law.3 But analysis of Oregon’s statute of repose belies this presumption. A state’s interest in preventing financial burdens “is primarily local; that is, a state by enacting a damage limitation seeks to protect its own residents.” Spider Staging, 87 Wn.2d at 582-83. Under these circumstances, Oregon’s intention to protect local *835businesses and manufacturers is not furthered by applying Oregon law to immunize Goodyear from liability.

In this case, Goodyear’s product was neither designed nor manufactured in Oregon, nor was it in Oregon when it caused injury. Unlike Rice,4 there is no evidence here that Goodyear sold or delivered this particular product for use in Oregon. And unlike Frosty, there is no evidence that Goodyear’s product ever came into contact with the injured persons in Oregon. We conclude that, under these circumstances, Washington’s interest in protecting persons from injuries from defective products within its borders outweighs Oregon’s interest in protecting a manufacturer whose product arrives in Oregon through the stream of commerce and subsequently causes injury to a third party in another state.

This conclusion is supported by the decision in Spider Staging, 87 Wn.2d 577. There, our Supreme Court held that Washington law applied to products liability claims by a Kansas resident against a Washington manufacturer arising from a fatal accident that occurred in Kansas. Under Kansas law, the Washington defendant’s damages would be capped at $50,000, but Washington permitted full compensation for the wrongful death. After evaluating the competing interests that would be served by applying Washington or Kansas law, the court determined that Kansas’s interest in limiting liability of local defendants was not served by capping a damage claim against a nonresident defendant where another state (Washington) sought to deter that defendant’s tortious conduct. We find this rationale persuasive. Here, as in Spider Staging, Washington’s deterrence interests will be better served by applying Washington law. See also Jaurequi v. John Deere Co., 986 F.2d 170 (7th Cir. 1993) (state’s interest in regulating foreign-made products that cause injury within state borders, even to nonresi*836dents, supersedes interests of state of manufacture). We therefore decide that Washington’s statute of repose applies to the claims against Goodyear in this case. The judgment of the trial court is affirmed on all issues.5

The remainder of this opinion has no precedential value. Therefore, it will be filed for public record in accordance with the rules governing unpublished opinions.

Appelwick and Schindler, JJ., concur.

Review denied at 149 Wn.2d 1033 (2003).

Opinion

GEORGE, C. J.

This case presents a choice-of-law issue arising in a lawsuit filed by plaintiff Terry McCann (plaintiff) to recover damages for an illness, mesothelioma, allegedly caused by his exposure to asbestos. Although the complaint seeks recovery from numerous defendants, the issue before us relates solely to the potential liability of a single defendant, Foster Wheeler LLC (Foster Wheeler), a company that specially designed, manufactured, and provided advice regarding the installation of a very large boiler at an oil refinery in Oklahoma in 1957. At the time the boiler was being installed at the Oklahoma refinery, plaintiff, then an Oklahoma resident and a newly hired engineering sales trainee employed by the construction company that was installing the boiler, allegedly was exposed to asbestos at various times over a two-week period while he observed the application of asbestos insulation to the boiler by an independent insulation contractor.

Eighteen years later, in 1975, after working at various jobs in Minnesota and Illinois, plaintiff moved to Dana Point, California, to take a position as executive director of Toastmasters International. In 2005, after having retired from his Toastmasters position in 2001 and continuing to reside in California, plaintiff was diagnosed with mesothelioma. A few months later, plaintiff filed this action in California, naming numerous defendants, including Foster Wheeler.

Prior to trial, Foster Wheeler moved for summary judgment on various grounds, including that plaintiff’s action against it was governed by, and barred under, an Oklahoma statute of repose that required any cause of action *75 against a designer or constructor of an improvement to real property to be filed within 10 years of the substantial completion of the improvement. In opposing the motion, plaintiff contended, first, that his cause of action for an injury or illness caused by exposure to asbestos should be governed by the relevant California statute of limitations (under which the action would have been timely filed), rather than by Oklahoma law, and, second, that in any event Foster Wheeler’s boiler was not an improvement to real property within the meaning of the relevant Oklahoma statute of repose.

After the trial court initially determined that Oklahoma, rather than California, law should apply to the timeliness issue but that there were disputed questions of fact regarding whether the action against Foster Wheeler fell within the reach of the Oklahoma statute of repose, the parties agreed that the trial court, instead of a jury, should determine whether the Oklahoma statute applied. After considering the declarations filed by each party and a number of judicial decisions interpreting the Oklahoma statute, the trial court found that Foster Wheeler was a designer of an improvement to real property within the meaning of the Oklahoma statute of repose and entered judgment dismissing Foster Wheeler as a defendant in plaintiff’s underlying action.

On appeal, the Court of Appeal concluded that the trial court erred in determining that Oklahoma law rather than California law should apply in these circumstances; as a consequence, the Court of Appeal did not reach the question whether the trial court erred in finding that the action against Foster Wheeler fell within the reach of the applicable Oklahoma statute of repose. In analyzing the choice-of-law issue under the “governmental interest” approach endorsed by the governing California decisions, the Court of Appeal reasoned that California “has an obvious interest in providing a remedy to its long-term residents who sustain asbestos-related injuries,” but that Oklahoma’s interest in the application of its statute of repose “is substantially ... an interest in protecting Oklahoma defendants from liability for conduct occurring in Oklahoma.” Because Foster Wheeler’s corporate headquarters was located in New York rather than in Oklahoma, the Court of Appeal found that Foster Wheeler was not “among the defendants in whose favor Oklahoma’s statute of repose is primarily directed” and consequently that “any significant interest of Oklahoma in the application of its statute of repose ... is difficult to discern.” The Court of Appeal further concluded that even if it were assumed a “true conflict” exists in this case, the interests of California would be more impaired by the application of Oklahoma law than would be the interests of Oklahoma by the failure to apply its law. Accordingly, the appellate court held that the trial court erred in applying the Oklahoma statute of repose to McCann’s claim against Foster Wheeler, and reversed the trial court’s judgment in favor of Foster Wheeler.

*76 On petition by Foster Wheeler, we granted review primarily to consider whether the Court of Appeal was correct in determining (1) that Oklahoma’s interest in the application of its statute of repose is substantially limited to application of the statute to companies headquartered in Oklahoma and does not equally encompass out-of-state companies who design or construct improvements to real property located in Oklahoma, and (2) that California’s interests, rather than Oklahoma’s interests, would be more impaired by the failure to apply the respective state’s law on the facts presented here.

For the reasons discussed more fully below, we conclude that the decision of the Court of Appeal should be reversed. As we explain, prior California choice-of-law decisions demonstrate that, contrary to the conclusion reached by the Court of Appeal, Oklahoma’s interest in the application of its statute of repose applies as fully to out-of-state companies that design and construct improvements to real property in Oklahoma as to Oklahoma companies that design and construct such improvements. Further, although California has a legitimate interest in affording a remedy to a resident of California whose asbestos-related illness first manifests itself when the individual is a California resident, past California cases indicate that it is generally appropriate for a court to accord limited weight to California’s interest in providing a remedy for a current California resident when the conduct of the defendant from whom recovery is sought occurred in another state, at a time when the plaintiff was present in (and, in the present situation, a resident of) that other state, and where that other state has its own substantive law, that differs from California law, governing the defendant’s potential liability for the conduct that occurred within that state. Taking these factors into consideration, we conclude that Oklahoma’s interest would be more impaired by the failure to apply its law in these circumstances than would be California’s interest by the failure to apply its law, and thus that the law of Oklahoma, rather than the law of California, should apply to the issue presented here.

I

A

The facts relevant to the choice-of-law issue before us are not in dispute.

As noted, Foster Wheeler’s asserted liability for plaintiff’s illness is based upon plaintiff’s alleged exposure to asbestos in Oklahoma over a two-week period in July 1957, nearly 50 years prior to the time plaintiff was diagnosed with mesothelioma in 2005.

In July 1957, plaintiff, then an Oklahoma resident and a recent college graduate, was a newly hired engineering sales trainee employed by Tulsa *77 Refinery Engineering Company (TRECO), an oil refinery construction company that was engaged in constructing an expansion of an oil refinery owned by D-X Oil Company of Tulsa, Oklahoma (Sunray). In connection with the expansion, Sunray had ordered a specially designed steam generator from Foster Wheeler, a corporation headquartered in New York. The generator consisted of a custom-designed and extensively engineered boiler and related equipment that was to be designed and manufactured by Foster Wheeler in New York, and shipped unassembled to the refinery in Oklahoma, where it was to be assembled and installed by TRECO at the refinery, in consultation with an adviser employed by Foster Wheeler. The boiler in question was “huge”—more than 25 feet high and weighing many tons—and was to be installed on a specially poured foundation constructed by TRECO.

Pursuant to the terms of the contract between Sunray and Foster Wheeler, the generator was shipped to Sunray without insulation. The responsibility for installing the necessary insulation for the generator was to be borne by Sunray. Sunray hired an independent contractor—a company other than TRECO but not identified in the record—to install the insulation around the boiler. Plaintiff maintains that Foster Wheeler specified the need for insulation and knew or should have known the insulation was likely to contain asbestos.

As noted, at the time of the alleged exposure plaintiff was a newly hired engineering sales trainee employed by TRECO. Plaintiff testified at his deposition that his job responsibility at that time was simply to observe the ongoing construction at the refinery and to learn all there was to know about building a refinery. When plaintiff began work with TRECO, the assembly and installation of the Foster Wheeler boiler had been largely completed, and the independent contractor was in the process of installing insulation around the boiler and related equipment. Plaintiff acknowledged he did not assist in the actual application or installation of the insulation, but stated he observed the installation work for brief periods and occasionally stepped inside the boiler to take a look. He recalled observing the sawing of block insulation, the preparation and installation of insulating cement on the boiler, and the rising of dust clouds created by the mixing of the cement. In response to a question concerning the total amount of time he had been around the Foster Wheeler boiler, plaintiff stated that a “wild guess” would be “two or three days in total.”

Construction of the generator and its insulation was completed within a few weeks of plaintiff’s arrival at the Sunray refinery. After observing other aspects of the construction of the refinery expansion for more than a year, plaintiff moved to an office job in TRECO’s Oklahoma headquarters in Tulsa.

*78 In 1965, plaintiff left Tulsa and moved to Minnesota, where he began working in the advertising industry. In 1967, plaintiff moved to Chicago, Illinois, to take a job as manager of education for a food industry trade association. While in Chicago, he earned an MBA degree from Loyola University Chicago.

In 1975, plaintiff moved to Dana Point, California, accepting the position of executive director of Toastmasters International, a nonprofit organization that assists individuals in becoming more competent and comfortable in public speaking. He remained director of Toastmasters for 26 years until retiring in 2001.

In April 2005, plaintiff, who continued to reside in California, was diagnosed with mesothelioma. He filed the complaint in the underlying action in July 2005, naming numerous defendants, including Foster Wheeler. 1

B

As noted above, prior to the commencement of trial Foster Wheeler filed a motion for summary judgment. Among other contentions, the summary judgment motion asserted that the timeliness of the action should be governed by Oklahoma law, rather than California law, and that under Oklahoma law plaintiff’s cause of action against Foster Wheeler was barred by an Oklahoma statute of repose 2 providing that any tort action for injury arising from “the *79 design, planning, supervision or observation of construction or construction of an improvement to real property” must be brought within 10 years of the “substantial completion” of the improvement. (Okla. Stat. tit. 12, § 109 (hereafter section 109).) Because plaintiff’s lawsuit was filed long after the 10-year period specified in the Oklahoma statute of repose had expired, Foster Wheeler maintained that the action against it must be dismissed.

In support of this contention, the summary judgment motion first maintained that under the “governmental interest” analysis generally applied by California courts in resolving choice-of-law issues, the application of Oklahoma law rather than California law is appropriate. Thereafter, to support its claim that section 109—the Oklahoma statute of repose—applies to the facts of this case, the summary judgment motion relied upon an Oklahoma decision that determined the statute was applicable to the manufacturer and designer of a very large, specially designed piece of equipment installed in an industrial building. (Ball v. Harnischfeger Corp. (1994) 1994 OK 65 [877 P.2d 45] [holding § 109 applied to designer and manufacturer of large crane specially designed for installation in a particular building].) The motion attached a declaration of an engineer describing in detail the size and features of the boiler in question and the extensive engineering efforts that were entailed in designing and constructing the boiler to meet the particular specifications of the Sunray refinery.

In his opposition to the motion for summary judgment, plaintiff first maintained that section 361 of the Code of Civil Procedure (section 361)— California’s so-called “borrowing statute,” which we discuss below (pp. 83-87, post)—requires application of the California statute of limitations in this case without consideration of the governmental interest analysis that ordinarily governs the resolution of choice-of-law issues under California law. Although section 361 provides that, in general, a cause of action arising in another state cannot be maintained in California if the other state’s law bars the action due to a lapse of time, this statute contains an exception for a person “who has been a citizen of this State, and who has held the cause of action from the time it accrued.” The opposition to the summary judgment motion argued that plaintiff fell within this exception and that, as a consequence, section 361 mandated application of the relevant California statute of limitations without regard to the governmental interest analysis.

Plaintiff further argued that even if section 361 did not preclude resort to the governmental interest analysis, under a proper application of that analysis, *80 California law, rather than Oklahoma law, should be found applicable. Plaintiff maintained that California’s governmental interest would be significantly impaired by application of the Oklahoma statute of repose to bar plaintiff’s action against Foster Wheeler, whereas Oklahoma had no interest in barring a cause of action that, plaintiff claimed, arose outside Oklahoma’s borders because plaintiff first incurred the symptoms and effects of mesothelioma while he was a longtime resident of California. Finally, plaintiff contended that even if Oklahoma law was applicable, Foster Wheeler did not fall within the reach of the Oklahoma statute of repose, because Foster Wheeler was merely the manufacturer of a defective product and should not be considered the designer of an improvement to real property within the meaning of the Oklahoma statute.

In ruling on the summary judgment motion, the trial court, although agreeing with Foster Wheeler’s argument that Oklahoma law, rather than California law, should govern the timeliness of the action, nonetheless denied Foster Wheeler’s motion for summary judgment, on the ground that there was a triable issue of fact concerning whether Foster Wheeler was a designer of an improvement to real property for purposes of the Oklahoma statute of repose.

Thereafter, Foster Wheeler filed a motion under Evidence Code section 402, seeking to have the trial court determine the “narrow factual question” whether Foster Wheeler was a designer of an improvement to real property under the terms of the Oklahoma statute of repose. Plaintiff joined in die request to have this question resolved by the trial court rather than by a jury, asking the trial court to rule in its favor on this issue and to preclude Foster Wheeler from bringing any evidence relating to the Oklahoma statute of repose before the jury.

After considering the evidence and legal argument presented by both parties on this issue, the trial court found that Foster Wheeler was a designer of an improvement to real property within the meaning of the Oklahoma statute of repose. Accordingly, the trial court entered judgment in favor of Foster Wheeler, dismissing plaintiff’s action against Foster Wheeler.

C

In the Court of Appeal, plaintiff on a number of grounds challenged the trial court’s judgment in favor of Foster Wheeler.

First, plaintiff asserted the trial court erred in failing to conclude that the timeliness of plaintiff’s action should be governed by California law, rather than Oklahoma law. Plaintiff again argued initially that application of the *81 California statute of limitations was compelled under the provisions of section 361, California’s borrowing statute, without any need to consider the governmental interest analysis generally applicable to choice-of-law issues. Further, plaintiff maintained that even if the governmental interest analysis was applied, under that analysis the California statute of limitations for asbestos-caused injuries or illnesses, rather than the Oklahoma statute of repose, should govern.

Second, plaintiff maintained that even if Oklahoma law was applicable, the trial court erred in finding that Foster Wheeler fell within the reach of the Oklahoma statute of repose, because the evidence failed to support the trial court’s conclusion that the boiler was an improvement to real property for purposes of the Oklahoma statute. In advancing this argument, plaintiff relied primarily upon Foster Wheeler’s failure to prove that the boiler had been taxed as real property in Oklahoma.

In addressing plaintiff’s contentions, the Court of Appeal initially expressed skepticism regarding plaintiff’s argument that the provisions of section 361 properly should be interpreted to compel application of the California statute of limitations, without consideration of the governmental interest analysis, whenever the plaintiff in an action filed in a California court is a citizen of California at the time his or her cause of action accrues. Instead, the Court of Appeal suggested that although the language of section 361 requires a California court to apply the law of a foreign state barring an action arising in the foreign state as untimely when the plaintiff is not a California citizen at the time the cause of action accrues, when the plaintiff is a California citizen when the cause of action accrues “the statute, on its face, permits the court to apply California law . . . but it does not expressly require the court to do so; it merely excepts California citizens from the mandatory application of foreign law. We doubt . . . that the statutory exception for plaintiffs who were citizens when their cause of action accrued requires the court to apply California law, in circumstances where the application of California’s choice of law principles would dictate otherwise.” The Court of Appeal went on to state, however, that “[w]e need not definitively determine the point,” in light of that court’s subsequent conclusion that in this case “California’s choice of law principles require the application of California law rather than Oklahoma law.”

Thereafter, in discussing the choice-of-law issue, the Court of Appeal began by summarizing the governmental interest approach set forth in prior California decisions: “Three steps are involved. First, the court must determine whether the foreign law differs from California law. Second, if there is a difference, the court must determine whether a ‘true conflict’ exists by determining whether both states have a legitimate interest in applying their *82 own law to the case at hand. [Citation.] Third, when both states have a legitimate interest in the application of their respective laws, the court analyzes the ‘comparative impairment’ of the interests of the two states and applies the law of the state whose interest would be more impaired if its law were not applied. [Citation.]” The appellate court then proceeded to apply this approach to the circumstances here at issue.

The Court of Appeal first observed that the laws of Oklahoma and California clearly differ, because if the Oklahoma statute of repose applied, plaintiff’s action against Foster Wheeler would be barred by the lapse of time, whereas plaintiff’s action would be timely under the applicable California statute of limitations (Code Civ. Proc., § 340.2), which permits an action for injury or illness based upon exposure to asbestos to be brought within a year of the date the plaintiff first suffered disability and knew or reasonably should have known that such disability was caused by exposure to asbestos.

In considering the second step of the analysis—whether a “true conflict” exists—the Court of Appeal stated that “[w]e harbor serious doubt that a true conflict exists in this case between the interests of California and Oklahoma. California has an obvious interest in providing a remedy to its long-term residents who sustain asbestos-related injuries .... Oklahoma’s interest—in protecting defendants who design or construct improvements to real property by placing a time limitation on their liability for tortious conduct—is considerably less evident in the circumstances of this case. Oklahoma’s interest is substantially a local one, that is, an interest in protecting Oklahoma defendants from liability for conduct occurring in Oklahoma. [Citation.] In this case, however, Foster Wheeler is not a citizen of Oklahoma, and is therefore not among the defendants in whose favor Oklahoma’s statute of repose is primarily directed. Moreover, Foster Wheeler’s allegedly tortious conduct was in the design and fabrication of the boiler, which conduct occurred in New York or some location other than Oklahoma. Consequently, any significant interest of Oklahoma in the application of its statute of repose—and hence a ‘true conflict’—is difficult to discern.”

Finally, in the third step of the analysis, the Court of Appeal stated that even if it assumed Oklahoma has a legitimate interest in the application of its statute of repose in this case, California law should apply because California’s interest would be more impaired than Oklahoma’s interest if its law were not applied. In reaching this conclusion, the Court of Appeal reasoned: “California has a significant interest in permitting [plaintiff] to seek compensation for asbestos-related injuries manifesting themselves in California. [Plaintiff] has been a California resident for many years, his injury accrued in California, and he relied on California’s health care facilities for his care. California has an interest in limiting health care costs that accrue as a result of barred *83 claims. This is particularly important in light of the prevalence of debilitating asbestos-related disease. California’s interest in providing him with a remedy is far more significant than Oklahoma’s interest in protecting a nonresident defendant from excessive financial burdens, particularly when the nonresident defendant’s liability is premised on design and manufacturing activity that did not occur in Oklahoma. We therefore conclude that the interests of California would be more significantly impaired by the application of Oklahoma law than the converse. Accordingly, the trial court erred in applying the Oklahoma statute of repose to [plaintiff’s] claim against Foster Wheeler.”

Because it concluded the trial court erred in failing to apply California law in determining the timeliness of plaintiff’s action against Foster Wheeler, the Court of Appeal did not reach plaintiff’s alternative contention that the trial court erred in finding that, under Oklahoma law, Foster Wheeler was entitled to the protection of the Oklahoma statute of repose. Having concluded that plaintiff’s action against Foster Wheeler was timely under California law, the Court of Appeal reversed the trial court’s judgment in favor of Foster Wheeler.

We granted Foster Wheeler’s petition for review.

II

Traditionally, a state’s general choice-of-law rules have been formulated by courts through judicial decisions rendered under the common law, rather than by the legislature through statutory enactments. In California, over the past four decades this court’s decisions have adopted and consistently applied the so-called “governmental interest” analysis as the appropriate general methodology for resolving choice-of-law questions in this state. (See, e.g., Reich v. Purcell (1967) 67 Cal.2d 551 [63 Cal.Rptr. 31, 432 P.2d 727] (Reich); Bernhard, v. Harrah’s Club (1976) 16 Cal.3d 313 [128 Cal.Rptr. 215, 546 P.2d 719] (Bernhard!); Offshore Rental Co. v. Continental Oil Co. (1978) 22 Cal.3d 157 [148 Cal.Rptr. 867, 583 P.2d 721] (Offshore Rental); Kearney v. Salomon Smith Barney, Inc. (2006) 39 Cal.4th 95 [45 Cal.Rptr.3d 730, 137 P.3d 914] (Kearney).)

With respect to the category of statutes of limitation and statutes of repose, however, many jurisdictions have enacted specific statutory provisions that address the subject of choice of law. As discussed in a leading treatise and a number of law review articles, a majority of American states have adopted so-called “borrowing statutes” that direct the courts of a state, in lawsuits filed within that state, to apply or “borrow” the relevant statute of limitations or statute of repose of a foreign jurisdiction under the particular circumstances specified in the statute, rather than to apply the statute of limitations *84 of the forum jurisdiction. (See generally Leflar et al., American Conflicts Law (4th ed. 1986) §§ 127-128, pp. 348-354 (Leflar Treatise); Ester, Borrowing Statutes of Limitation and Conflict of Laws (1962-1963) 15 U.Fla. L.Rev. 33 (Ester Article); Vernon, Statutes of Limitation in the Conflict of Laws: Borrowing Statutes (1960) 32 Rocky Mtn. L.Rev. 287.)

The general popularity of borrowing statutes is explained by the common law background against which such statutes were enacted. Under early common law conflict-of-law principles, rules of law ordinarily were characterized as either “substantive” or “procedural,” and procedural matters universally were held to be governed by the local or forum law. Because early common law decisions characterized statutes of limitations as procedural rather than substantive, the general rule at that time was that the local statute of limitations of the forum state—rather than another state’s statute of limitations—applied to an action filed in the forum state, regardless of the location of the most significant events and circumstances underlying the cause of action or relating to the parties. (Leflar Treatise, supra, § 127, pp. 348-349.) Thus, even when a cause of action arose out of an accident in one state and all the parties were residents of that state, if a lawsuit was filed in a different state, the court in which the action was filed generally would apply its own state’s statute of limitations, rather than the statute of limitations of the other state.

When the period specified in the forum state’s statute of limitations was shorter than that in the other state’s statute of limitations, application of the early common law rule would not necessarily create a serious problem or result in an unfair result, because if the forum’s statute of limitations had expired, the plaintiff, at least as a theoretical matter, still could bring the action in the other state. A more problematic situation was presented, however, when the period provided in the applicable statute of limitations of the forum state was longer than that in the applicable statute of limitations in the state where the cause of action arose. In that setting, a plaintiff who failed to timely file an action in the state in which the action arose would be provided the opportunity to search out another jurisdiction in which the applicable period under the relevant statute of limitations for the cause of action at issue was longer and in which the action could be maintained—a classic example of questionable forum shopping.

This is the principal problem to which borrowing statutes were generally addressed. (See, e.g., Pack v. Beech Aircraft Corporation (1957) 50 Del. 413 [132 A.2d 54, 57].) Although the provisions of the various states’ borrowing statutes differ in a variety of respects, these enactments typically “borrow” the statute of another state when the cause of action in question “arose,” “originated,” or “accrued” in the other state and would be barred as untimely *85 in that state. (See Ester Article, supra, 15 U.Fla. L.Rev. 33, 45-56.) Many borrowing statutes, however, also include exceptions that exempt from the reach of the borrowing statute lawsuits that are filed in the courts of the enacting state by residents or citizens of that state. (See id., at pp. 69-72.)

California first enacted a borrowing statute very early in its history, in 1851, as part of the state’s initial comprehensive legislation regulating proceedings in civil cases. (Stats. 1851, ch. 5, § 532, p. 134.) 3 When the Code of Civil Procedure was adopted in 1872, the early 1851 statute was codified, with only a minor change in language, as section 361. The language of section 361, as enacted in 1872, remains unchanged to this day.

Section 361 provides in full: “When a cause of action has arisen in another State, or in a foreign country, and by the laws thereof an action thereon cannot there be maintained against a person by reason of the lapse of time, an action thereon shall not be maintained against him in this State, except in favor of one who has been a citizen of this State, and who has held the cause of action from the time it accrued.”

Section 361 thus creates a general rule that when a cause of action has arisen in another jurisdiction but cannot be maintained against a particular defendant in that jurisdiction because of the lapse of time, the action cannot be maintained against that defendant in a California court. The statute contains an exception, however, for a plaintiff “who has been a citizen of this State, and who has held the cause of action from the time it accrued.” Past cases establish that this exception applies only where the plaintiff was a California citizen at the time the cause of action accrued, and does not extend to a plaintiff who became a citizen of California after the cause of action accrued but before the lawsuit in question was filed. (See, e.g., Biewend v. Biewend (1941) 17 Cal.2d 108, 115 [109 P.2d 701]; Grant v. McAuliffe (1953) 41 Cal.2d 859, 865 [264 P.2d 944]; accord, Miller v. Stauffler Chem. Co. (1978) 99 Idaho 299 [581 P.2d 345, 347-348].)

Although application of section 361 generally is straightforward in a case involving, for example, a typical automobile accident—in which the allegedly tortious conduct, the resulting injury, and compensable damage all occur at the same time and in the same place—proper application of the statute is more problematic in a case, like the present one, in which the defendant’s allegedly injury-producing conduct occurred in another state at a much earlier *86 date but the plaintiff’s resulting illness or injury does not become apparent and reasonably is not discovered until many decades later, at a time when the plaintiff has established residence in California. 4 In the factual setting here at issue, it may be reasonably debatable whether plaintiff’s cause of action against Foster Wheeler “arose” in Oklahoma or instead in California for purposes of section 361, and whether plaintiff was a citizen of California or of Oklahoma at the time the cause of action “accrued” within the meaning of the term as used in this borrowing statute. 5

Even if we assume either that the cause of action at issue “arose” in California for purposes of section 361 or that plaintiff was a citizen of *87 California from the time the cause of action “accrued” within the meaning of this statute—and thus that section 361 does not require application of Oklahoma law rather than California law on the facts of this case—we agree with the Court of Appeal that this statute cannot properly be interpreted to compel application of the California statute of limitations without consideration of California’s generally applicable choice-of-law principles. Although at the time section 361 was adopted, the then prevailing choice-of-law doctrine generally would have called for the application of the relevant California statute of limitations in a case in which section 361 did not mandate application of another jurisdiction’s law (see, e.g., Royal Trust Co. v. MacBean (1914) 168 Cal. 642, 646 [144 P. 139]), nothing in section 361 indicates that this statute was intended to freeze the then prevailing general choice-of-law rules into a statutory command, so as to curtail the judiciary’s long-standing authority to adopt and modify choice-of-law principles pursuant to its traditional common law role. (Cf. Li v. Yellow Cab Co. (1975) 13 Cal.3d 804, 813-823 [119 Cal.Rptr. 858, 532 P.2d 1226].) Accordingly, now that the earlier methodology for resolving choice-of-law issues has been replaced in this state by the governmental interest mode of analysis (see, e.g., Reich, supra, 67 Cal.2d 551, 553-557; Bernhard, supra, 16 Cal.3d 313, 316-321), in those instances in which section 361 does not mandate application of another jurisdiction’s statute of limitations or statute of repose the question whether the relevant California statute of limitations (or statute of repose) or, instead, another jurisdiction’s statute of limitations (or statute of repose) should be applied in a particular case must be determined through application of the governmental interest analysis that governs choice-of-law issues generally. (See, e.g., Ashland Chemical Co. v. Provence (1982) 129 Cal.App.3d 790, 793-794 [181 Cal.Rptr. 340] [holding that under California law, governmental interest analysis is applicable to resolve a choice-of-law issue relating to the statute of limitations]; Nelson v. International Paint Co. (9th Cir. 1983) 716 F.2d 640, 644 [same].)

Thus, we now turn to the task of applying the general governmental interest analysis to the circumstances before us in the present case.

III

Recently, in Kearney, supra, 39 Cal.4th 95, we summarized the mode of analysis called for by the governmental interest approach. “In brief outline, the governmental interest approach generally involves three steps. First, the court determines whether the relevant law of each of the potentially affected jurisdictions with regard to the particular issue in question is the same or different. Second, if there is a difference, the court examines each jurisdiction’s interest in the application of its own law under the circumstances of the particular case to determine whether a true conflict exists. Third, if the court *88 finds that there is a true conflict, it carefully evaluates and compares the nature and strength of the interest of each jurisdiction in the application of its own law ‘to determine which state’s interest would be more impaired if its policy were subordinated to the policy of the other state’ [citation], and then ultimately applies ‘the law of the state whose interest would be more impaired if its law were not applied.’ ” (39 Cal.4th at pp. 107-108.)

A

With regard to the first of these steps, we agree with the Court of Appeal that “[t]he laws of Oklahoma and California clearly differ.”

1

Under section 109 (the Oklahoma statute of repose), plaintiff’s cause of action would be barred by the lapse of time, because that statute “bars any tort action which arises more than ten years after the substantial completion of the improvement to real property.” (Riley v. Brown and Root, Inc. (1992) 1992 OK 114 [836 P.2d 1298, 1300].) 6 Although the Oklahoma statute in question has been interpreted not to bar products liability actions against the manufacturers and sellers of mass-produced products (see, e.g., Durham v. Herbert Olbrich GMBH & Co. (10th Cir. 2005) 404 F.3d 1249, 1254-1255; Uricam Corp. v. W.R. Grace & Co. (W.D.Okla. 1990) 739 F.Supp. 1493)— and thus would not preclude plaintiff from suing companies that manufactured or sold the asbestos insulation to which he was exposed (Uricam Corp. v. W.R. Grace & Co., supra, 739 F.Supp. at p. 1496)—the Oklahoma Supreme Court has interpreted the statute of repose to protect a manufacturer/designer of a specially designed improvement to real property. (Ball v. Harnischfeger Corp., supra, 877 P.2d 45, 50 [“If the manufacturer was acting as a designer, planner, construction supervisor or observer, or constructor, the statute of *89 repose will apply. It is the specialized expertise and rendition of particularized design which separates those protected from mere manufacturers and suppliers.”]; see also Goad v. Buschman Co. (N.D.Okla. 2008) 2008 U.S.Dist. Lexis 27297, pp. *7-*21 and cases cited, affd. (10th Cir. 2009) 2009 U.S.App. Lexis 6058.)

Although, as we have explained above, plaintiff argued in the Court of Appeal and continues to maintain in this court that the trial court erred in finding that the boiler in question was an improvement to real property for purposes of the Oklahoma statute of repose, the Court of Appeal never reached that issue, because it concluded that even if Foster Wheeler fell within the reach of the Oklahoma statute, under California’s choice-of-law principles California law would apply. In reviewing the conclusion reached by the Court of Appeal, we similarly shall assume for purposes of determining the choice-of-law issue that Foster Wheeler’s conduct brought it within the reach of the relevant Oklahoma statute of repose. 7 Under this premise, plaintiff’s action against Foster Wheeler plainly would be untimely under Oklahoma law, because this action was filed more than 10 years after substantial completion of the improvement. 8

2

By contrast, plaintiff’s action against Foster Wheeler clearly would be timely if California law were applied. Although this state has enacted a *90 statute of repose applicable to causes of action arising out of a latent deficiency in the design or construction of an improvement to real property that is somewhat similar to the relevant Oklahoma statute of repose (see Code Civ. Proc., § 337.15), 9 the California statute, unlike its Oklahoma counterpart, applies only to actions for injury to property, not to personal injury actions. (Martinez v. Traubner (1982) 32 Cal.3d 755, 757-761 [187 Cal.Rptr. 251, 653 P.2d 1046].) Furthermore, California has enacted a special statute of limitations explicitly governing the time for bringing an action “for injury or illness based upon exposure to asbestos,” which permits such an action to be brought up to one year after the plaintiff both (1) first suffered disability and (2) knew or reasonably should have known that the disability was caused or contributed to by exposure to asbestos. (Code Civ. Proc., § 340.2; 10 see Hamilton v. Asbestos Corp. (2000) 22 Cal.4th 1127, 1138 [95 Cal.Rptr.2d 701, 998 P.2d 403].) Here, plaintiff, who previously had retired for reasons unconnected to his asbestos-related illness, filed this action within a few months after he first was diagnosed with mesothelioma, and thus the action clearly would be timely under the provisions of section 340.2. (See Hamilton v. Asbestos Corp., supra, 22 Cal.4th at pp. 1138-1147.)

Accordingly, the law of Oklahoma clearly differs from the law of California with respect to the timeliness of plaintiff’s cause of action.

B

The second step of the governmental interest analysis requires us to examine “each jurisdiction’s interest in the application of its own law under the circumstances of the particular case to determine whether a true conflict exists.” (Kearney, supra, 39 Cal.4th at pp. 107-108.)

*91 1

Oklahoma decisions indicate that by establishing a relatively lengthy (10-year) period in which a cause of action for a deficiency in design of an improvement to real property may be brought, but at the same time terminating all liability after that deadline regardless of whether the plaintiff’s injury had yet occurred or become manifest, the relevant statute of repose was intended to balance the interest of injured persons in having a remedy available for such injuries against the interest of builders, architects, and designers of real property improvements in being subject to a specified time limit during which they would remain potentially liable for their actions in connection with such improvements. (See, e.g., St. Paul Fire & Marine Ins. Co. v. Getty Oil Co., supra, 782 P.2d 915, 920-921.) The Oklahoma high court held in St. Paul Fire & Marine Ins. Co. that the statute of repose, by establishing this type of fixed time limit in which any cause of action must be brought, serves “the legitimate government objectives of providing a measure of security for building professionals whose liability could otherwise extend indefinitely.” {Id. at p. 921.) The court further noted that the statute “also serves the legitimate objective of avoiding the difficulties in proof which arise from the passage of time.” {Ibid.)

In discussing the interest of Oklahoma embodied in the statute, the Court of Appeal in the present case expressed the view that “Oklahoma’s interest is substantially a local one, that is, an interest in protecting Oklahoma defendants from liability for conduct occurring in Oklahoma.” The appellate court indicated that Oklahoma’s interest in the application of this statute does not extend to, or at least does not apply as strongly to, a non-Oklahoma business that designs or constructs an improvement to real property located in Oklahoma. Because Foster Wheeler is a non-Oklahoma corporation (incorporated in Delaware, with its headquarters in New York), and because the design and manufacture of the boiler occurred in New York, the Court of Appeal expressed the view that “any significant interest of Oklahoma in the application of its statute of repose ... is difficult to discern.”

We conclude that the Court of Appeal did not accurately assess the interest of Oklahoma embodied in the statute of repose here at issue. When a state adopts a rule of law limiting liability for commercial activity conducted within the state in order to provide what the state perceives is fair treatment to, and an appropriate incentive for, business enterprises, we believe that the state ordinarily has an interest in having that policy of limited liability applied to out-of-state companies that conduct business in the state, as well as to businesses incorporated or headquartered within the state. A state has a legitimate interest in attracting out-of-state companies to do business within the state, both to obtain tax and other revenue that such businesses may *92 generate for the state, and to advance the opportunity of state residents to obtain employment and the products and services offered by out-of-state companies. In the absence of any explicit indication that a jurisdiction’s “business friendly” statute or rule of law is intended to apply only to businesses incorporated or headquartered in that jurisdiction (or that have some other designated relationship with the state—for example, to those entities licensed by the state), as a practical and realistic matter the state’s interest in having that law applied to the activities of out-of-state companies within the jurisdiction is equal to its interest in the application of the law to comparable activities engaged in by local businesses situated within the jurisdiction.

This court’s decision in Offshore Rental, supra, 22 Cal.3d 157, supports the foregoing conclusion. In Offshore Rental, the plaintiff was a California company that brought suit to recover economic damages it had suffered when one of its key employees had been injured in Louisiana, allegedly as a result of the negligence of one of the defendant company’s employees in Louisiana. The case presented a choice-of-law issue because California law permits a company to maintain a cause of action for the economic damage suffered by the company as a result of an injury to a key employee (an action separate from, and independent of, the employee’s own personal injury action), whereas Louisiana law does not permit an employer to maintain such a cause of action (permitting only the employee’s personal injury action). The defendant company in Offshore Rental was a Delaware corporation, headquartered in New York, that did business in Louisiana, California, and other states.

In examining the question whether Louisiana had an interest in having its law (denying the plaintiff company’s cause of action for injury to a key employee) applied in the circumstances of that case, the court in Offshore Rental, supra, 22 Cal.3d 157, explained: “The accident in question occurred within Louisiana’s borders; although the law of the place of the wrong is not necessarily the applicable law for all tort actions [citation], the situs of the injury remains a relevant consideration. At the heart of Louisiana’s denial of liability lies the vital interest in promoting freedom of investment and enterprise within Louisiana’s borders, among investors incorporated both in Louisiana and elsewhere. The imposition of liability on defendant, therefore, would strike at the essence of a compelling Louisiana law.” (22 Cal.3d at p. 168, italics added & omitted.) Thus, although the defendant in that case was an out-of-state company doing business in Louisiana, the California court *93 in Offshore Rental recognized that the interest of Louisiana in protecting companies from what the latter state viewed as excessive liability extended to such a company. 11

In concluding that Oklahoma had little or no interest in the application of its law to the present case because Foster Wheeler was not an Oklahoma company, the Court of Appeal relied upon two passages in Reich, supra, 67 Cal.2d 551, in which the court observed that “[t]he state of the place of the wrong has little or no interest in [the application of its statute limiting damages for wrongful death] when none of the parties reside there” (67 Cal.2d at p. 556), and that a state’s interest in avoiding the imposition of excessive financial burdens on defendants is a “primarily local” interest. (Ibid.) The Court of Appeal also relied upon a similar passage in Hurtado v. Superior Court (1974) 11 Cal.3d 574 [114 Cal.Rptr. 106, 522 P.2d 666], which declared that “a state’s interest in limiting recovery in wrongful death actions is in protecting resident defendants from excessive financial burdens.” (11 Cal.3d at p. 586.) Both Reich and Hurtado, however, concerned automobile accidents involving private individuals, not commercial entities, and nothing in those decisions suggests that a state’s interest in the application of a statute limiting liability for specified commercial activity carried on within the state applies only to local companies and not equally to out-of state companies doing business within the state. Unlike our decision in Offshore Rental, supra, 22 Cal.3d 157, Reich and Hurtado had no occasion to address that question.

Furthermore, just as the Court of Appeal erred in relying on the non-Oklahoma location of Foster Wheeler’s incorporation or headquarters as a basis for determining that Oklahoma lacked an interest in having its statute of repose applied here, the appellate court similarly erred in suggesting that Oklahoma’s interest in having its statute applied was negated by the circumstance that the design and manufacture of the boiler in question occurred in New York rather than in Oklahoma. The statute of repose here at issue protects not only construction-related businesses that engage in their activities at the Oklahoma site of the improvement, but also commercial entities, such as establishments performing architectural and other design-improvement work, that conduct their activities away from the location of the improvement but whose potential liability flows from a plaintiffs interaction with, or exposure to, the real property improvement in Oklahoma. Under the premise that the activities of Foster Wheeler in this case bring it within the reach of the Oklahoma statute of repose (see, ante, at p. 89), we conclude that, for *94 purposes of the governmental interest analysis, Oklahoma clearly possesses an interest in having the statute applied in the present case and that its interest is not diminished by the circumstance that some of Foster Wheeler’s activities occurred outside of Oklahoma. 12

Accordingly, contrary to the view expressed by the Court of Appeal, we conclude that Oklahoma has a real and legitimate interest in having its statute of repose applied under the circumstances presented here.

2

At the same time, we also recognize that California has an interest in having California law applied in this case.

As discussed above, the applicable California statute—Code of Civil Procedure section 340.2-—permits an action for injury or illness based upon exposure to asbestos to be brought up to one year after the plaintiff first suffered disability (as defined by the statute) and knew or reasonably should have known that the disability was caused or contributed to by such exposure. This statute, enacted in 1979 to lengthen the period of time in which an asbestos-related claim may be brought, reflects a state interest in providing persons who suffer injury or illness as a result of their exposure to asbestos a fair and reasonable opportunity to seek recovery for their injury or illness, taking into account not only the typically lengthy period between exposure to asbestos and the development of disease but also the often substantial period between the initial discovery or diagnosis of a disease and the time when the disease becomes disabling. (See, e.g., Hamilton v. Asbestos Corp., supra, 22 Cal.4th 1127, 1138-1139; Blakey v. Superior Court (1984) 153 Cal.App.3d 101, 105-106 [200 Cal.Rptr. 52]; Nelson v. Flintkote Co. (1985) 172 Cal.App.3d 727, 735 [218 Cal.Rptr. 562].) The language of section 340.2 does not specify the class of persons to whom the statute was intended to apply, but by its terms the provision is not limited only to persons who were exposed to asbestos in California. In view of the legislation’s clear recognition of the unusual nature of asbestos-related injury and illness, and the statute’s objective to provide injured or ill persons a fair and adequate opportunity to seek recovery for such asbestos-related harm, we conclude that *95 California has an interest in having this statute applied to a person, like plaintiff, who is a California resident at the time the person discovers that he or she is suffering from an asbestos-related injury or illness, even when the person’s exposure to asbestos occurred outside California.

A number of prior California cases support the conclusion that California has a legitimate interest in having a statutory provision that affords a remedy for or a benefit to an injured person or business applied when, as here, the injured person or business is a California resident or business, even when the injury-producing conduct occurs outside California. In Offshore Rental, supra, 22 Cal.3d 157, for example, although ultimately concluding that the Louisiana rule of law denying a cause of action for injury to a company’s “key employee” should be applied, this court, in discussing the second step of the governmental interest analysis, determined that California had a real and legitimate interest in having its rule of law—permitting such a cause of action—applied in favor of a California company that had suffered such an injury, even though the injury to the company’s key employee had occurred in another state. (See 22 Cal.3d at p. 164 [“California’s economy and tax revenues are affected regardless of the situs of physical injury.”].)

The decision in Castro v. Budget Rent-A-Car System, Inc. (2007) 154 Cal.App.4th 1162 [65 Cal.Rptr.3d 430] (Castro) also supports the conclusion recognizing a legitimate interest on the part of California under such circumstances. In Castro, the plaintiff, a California resident, was injured in a traffic accident that occurred in Alabama, allegedly caused by the negligence of the driver of a rented truck that was owned and leased by the defendant Budget Rent-A-Car. Under Alabama law, the owner of a motor vehicle is not liable for the negligence of a permissive user of the vehicle except under limited circumstances; under California law, by contrast, an owner of a motor vehicle generally is vicariously liable, up to a specified amount, for the negligence of a permissive user. (154 Cal.App.4th at p. 1179.) In discussing whether California had an interest in having its law applied under the circumstances presented by that case, the court in Castro first observed that a primary purpose of the California permissive user law—“motivating vehicle owners who allow others to use their vehicles within California to exercise care in the selection and supervision of such permissive users, and . . . protecting persons using California roadways” (id. at p. 1182)—would not be furthered by the application of California law in that case, because the accident in question occurred in Alabama rather than in California (id. at pp. 1181-1182). Nonetheless, the court in Castro concluded that California “does have a legitimate governmental interest in having its permissive user statute applied based on Castro’s status as a California resident. Application of that statute to circumstances such as these would serve to ensure that California residents injured in traffic accidents in other states would be compensated for *96 their injuries and not become dependent on the resources of California for necessary medical, disability, and unemployment benefits.” (Id. at p. 1182, italics added.)

Although, as we discuss further below (p. 100, post), the court in Castro ultimately concluded in the third step of the governmental interest analysis (the comparative impairment prong) that Alabama law rather than California law should apply in the circumstances of that case, the passage in Castro quoted above supports the conclusion that California has a legitimate governmental interest in having California law applied in the present case. Application of the California statute of limitations to a current California resident who suffers an injury or illness as a result of his or her prior exposure to asbestos in another jurisdiction would assist such residents in obtaining compensation for their injuries and in not becoming dependent on the resources of California for necessary medical, disability, and unemployment benefits. 13

Accordingly, California, as well as Oklahoma, has an interest in having its own law applied in this case.

Because the applicable laws of Oklahoma and California differ and each state has an interest in having its law applied under the circumstances of the present case, we are faced with a “true conflict.” As explained above, in such instances we apply the so-called “comparative impairment” approach.

C

Under the comparative impairment analysis, we must “carefully evaluate^ and compare[] the nature and strength of the interest of each jurisdiction in the application of its own law ‘to determine which state’s *97 interest would be more impaired if its policy were subordinated to the policy of the other state.’ ” (Kearney, supra, 39 Cal.4th 95, 108.) In conducting this evaluation, our prior decisions emphasize that it is important to keep in mind that “[t]he court does not “weigh” the conflicting governmental interests in the sense of determining which conflicting law manifested the “better” or the “worthier” social policy on the specific issue. An attempted balancing of conflicting state policies in that sense ... is difficult to justify in the context of a federal system in which, within constitutional limits, states are empowered to mold their policies as they wish. . . . [Instead, the process] can accurately be described as ... a problem of allocating domains of lawmaking power in multi-state contexts—[by determining the appropriate] limitations on the reach of state policies—as distinguished from evaluating the wisdom of those policies. . . . [E]mphasis is placed on the appropriate scope of conflicting state policies rather than on the “quality” of those policies ....’” (Bernhard, supra, 16 Cal.3d 313, 320-321.)

Accordingly, our task is not to determine whether the Oklahoma rule or the California rule is the better or worthier rule, but rather to decide—in light of the legal question at issue and the relevant state interests at stake—which jurisdiction should be allocated the predominating lawmaking power under the circumstances of the present case.

1

In light of the relevant facts of this case, we conclude that a failure to apply Oklahoma law would significantly impair Oklahoma’s interest. The conduct for which plaintiff contends Foster Wheeler should be held liable— plaintiff’s alleged exposure to asbestos during the application of insulation to a boiler designed and manufactured by Foster Wheeler—occurred in Oklahoma in 1957, at a time when plaintiff was present in Oklahoma and was an Oklahoma resident. As already discussed, the circumstance that Foster Wheeler is not an Oklahoma company—the circumstance relied upon by the Court of Appeal—is not a persuasive basis for finding that the failure to apply Oklahoma law would not significantly impair Oklahoma’s interest. Oklahoma’s interest in the application of its statute of repose applies equally to out-of-state businesses that design improvements to real property located in Oklahoma and to Oklahoma businesses that design such improvements situated within that state.

Although California no longer follows the old choice-of-law rule that generally called for application of the law of the jurisdiction in which a defendant’s allegedly tortious conduct occurred without regard to the nature of the issue that was before the court (see Reich, supra, 67 Cal.2d 551, 553), California choice-of-law cases nonetheless continue to recognize that a *98 jurisdiction ordinarily has “the predominant interest” in regulating conduct that occurs within its borders (Reich, supra, 67 Cal.2d 551, 556; see Cable v. Sahara Tahoe Corp. (1979) 93 Cal.App.3d 384, 394 [155 Cal.Rptr. 770]), and in being able to assure individuals and commercial entities operating within its territory that applicable limitations on liability set forth in the jurisdiction’s law will be available to those individuals and businesses in the event they are faced with litigation in the future. (See, e.g., Offshore Rental, supra, 22 Cal.3d 157, 168; Castro, supra, 154 Cal.App.4th 1152, 1180; Cable, supra, 93 Cal.App.3d 384, 394.)

In the present case, in the event Foster Wheeler were to be denied the protection afforded by the Oklahoma statute of repose and be subjected to the extended timeliness rule embodied in California law, the subordination of Oklahoma’s interest in the application of its law would rest solely upon the circumstance that after defendant engaged in the allegedly tortious conduct in Oklahoma, plaintiff happened to move to a jurisdiction whose law provides more favorable treatment to plaintiff than that available under Oklahoma law.

Although here it is clear that plaintiff’s move to California was not motivated by a desire to take advantage of the opportunities afforded by California law and cannot reasonably be characterized as an instance of forum shopping (cf. Reich, supra, 67 Cal.2d 551, 555-556), the displacement of Oklahoma law limiting liability for conduct engaged in within Oklahoma, in favor of the law of a jurisdiction to which a plaintiff subsequently moved, would—notwithstanding the innocent motivation of the move—nonetheless significantly impair the interest of Oklahoma served by the statute of repose. If Oklahoma’s statute were not to be applied because plaintiff had moved to a state with a different and less “business-friendly” law, Oklahoma could not provide any reasonable assurance—either to out-of-state companies or to Oklahoma businesses—that the time limitation embodied in its statute would operate to protect such businesses in the future. Because a commercial entity protected by the Oklahoma statute of repose has no way of knowing or controlling where a potential plaintiff may move in the future, subjecting such a defendant to a different rule of law based upon the law of a state to which a potential plaintiff ultimately may move would significantly undermine Oklahoma’s interest in establishing a reliable rule of law governing a business’s potential liability for conduct undertaken in Oklahoma. (Accord, Castro, supra, 154 Cal.App.4th 1162, 1181 [Alabama, whose law limited the potential liability of a vehicle owner for the negligence of a permissive user, has an interest “in not having vehicle owners and drivers in its jurisdiction subjected to different liabilities based on the fortuity of which state a plaintiff happens to be a resident. . . . Alabama has an interest in the uniform application of motor vehicle laws to owners and drivers in Alabama.”]; see also Hancock, The Effect in Choice of Law Cases of the Acquisition of a New *99 Domicile After the Commission of a Tort or the Making of a Contract (1979) 2 Hastings Int’l & Comp. L.Rev. 215, 218-219.)

2

By contrast, a failure to apply California law on the facts of the present case will effect a far less significant impairment of California’s interest. Certainly, if the law of this state is not applied here, California will not be able to extend its liberal statute of limitations for asbestos-related injuries or illnesses to some potential plaintiffs whose exposure to asbestos occurred wholly outside of California. Nonetheless, our past choice-of-law decisions teach that California’s interest in applying its laws providing a remedy to, or facilitating recovery by, a potential plaintiff in a case in which the defendant’s allegedly tortious conduct occurred in another state is less than its interest when the defendant’s conduct occurred in California. As we shall see, in a number of choice-of-law settings, California decisions have adopted a restrained view of the scope or reach of California law with regard to the imposition of liability for conduct that occurs in another jurisdiction and that would not subject the defendant to liability under the law of the other jurisdiction. Our view is that a similar restrained view of California’s interest in facilitating recovery by a current California resident is warranted in evaluating the relative impairment of California’s interest that would result from the failure to apply California law in the present setting.

Two California decisions discussed above are closely on point. As we have seen, in Offshore Rental, supra, 22 Cal.3d 157, the question before this court was whether Louisiana law (which barred an employer from maintaining an independent cause of action for economic damages resulting from an injury to a key employee) or California law (which permitted such a cause of action) should apply when an employee of a California company was injured in Louisiana allegedly as a result of the negligence of a company doing business in that state. Although recognizing that California had an interest in applying its law permitting recovery, because the plaintiff in that case was a California company, the court in Offshore Rental ultimately concluded that Louisiana law should apply, reasoning in part that “[b]y entering Louisiana, plaintiff ‘exposed [ijtself to the risks of the territory,’ and should not expect to subject defendant to a financial hazard that Louisiana law had not created.” (22 Cal.3d at p. 169.) By parity of reasoning, because plaintiff in the present case was in (and, indeed, a resident of) Oklahoma at the time of his exposure to asbestos, for which he claims Foster Wheeler should be held responsible, it is reasonable to conclude that he “should not expect to subject defendant to a financial hazard that [Oklahoma] law had not created,” and that California has a lesser interest in applying its law in that setting than it would in a case in which a defendant is responsible for exposing a plaintiff to asbestos within California.

*100 Similarly, in Castro, supra, 154 Cal.App.4th 1162, the Court of Appeal reached a comparable conclusion in another choice-of-law case arising out of a factual setting in which a California resident was injured in another state and sought recovery from a commercial entity doing business in that other state. As described above, in Castro the California plaintiff was injured in Alabama in an accident allegedly caused by a negligent permissive user of a truck owned by defendant Budget Rent-A-Car, which had been leased in Alabama to an Alabama company. Alabama law provides that the owner of a motor vehicle who is not personally negligent is generally not liable for damages caused by the negligence of a permissive user of the vehicle, whereas California law generally imposes vicarious liability, up to a limited dollar amount, on a vehicle owner when a permissive user of the vehicle negligently injures another person. Although recognizing that California had a legitimate interest in the application of its law based upon Castro’s status as a California resident (on the ground, as noted above, that application of California law “would serve to ensure that California residents injured in traffic accidents in other states would be compensated for their injuries and not become dependent on the resources of California for necessary medical, disability, and unemployment benefits” (154 Cal.App.4th at p. 1182)), the court in Castro concluded that such an interest was “not sufficient to reallocate Alabama’s and California’s ‘ “respective spheres of lawmaking influence.” ’ . . . [f] . . . [B]y entering and driving in Alabama, Castro voluntarily exposed himself to the risks of that ‘territory,’ and therefore plaintiffs should not expect to subject Budget to a ‘financial hazard’ that Alabama law had not created. Based on the respective governmental interests of Alabama and California, Alabama’s interest in allocating liability and deterring negligent driving within its borders would be more impaired by the application of California’s permissive user statute than would California’s interests if Alabama law is applied.” (154 Cal.App.4th at p. 1182.) (See also Tucci v. Club Mediterranee (2001) 89 Cal.App.4th 180, 190-194 [107 Cal.Rptr.2d 401] [holding that other jurisdiction’s law would be more impaired if defendant employer, who had obtained adequate workers’ compensation insurance in compliance with the law of that jurisdiction, were to be subjected to a common law tort action, permitted under California law, that was filed by a California resident who was injured while working for defendant in the other jurisdiction]; Arno v. Club Med Inc., supra, 22 F.3d 1464, 1468 [holding that under California choice-of-law principles, French law, rather than California law, applied to tort action arising out of injury to California resident that occurred in France].)

As these decisions demonstrate, in allocating the “ ‘respective spheres of lawmaking influence’ ” (Offshore Rental, supra, 22 Cal.3d 157, 165) in cases in which a California resident is injured by a defendant’s conduct occurring in another state, past California choice-of-law decisions *101 generally hold that when the law of the other state limits or denies liability for the conduct engaged in by the defendant in its territory, that state’s interest is predominant, and California’s legitimate interest in providing a remedy for, or in facilitating recovery by, a current California resident properly must be subordinated because of this state’s diminished authority over activity that occurs in another state. Although under the circumstances of the present case this allocation of “lawmaking influence” results in the subordination of California’s interest to the interest of Oklahoma, in other instances in which a defendant is responsible for exposing persons to the risks associated with asbestos or another toxic substance through its conduct in California, this general principle would allocate to California the predominant interest in regulating the conduct. (See, e.g., North American Asbestos Corp. v. Superior Court (1986) 180 Cal.App.3d 902, 907-908 [225 Cal.Rptr. 877] [holding California law applicable when the plaintiff was exposed to asbestos in California by a company incorporated in another state, where plaintiff’s action against the company would have been barred as untimely under the other state’s law].)

Plaintiff contends, however, that the foregoing analysis is erroneous and that cases such as Offshore Rental, supra, 22 Cal.3d 157, and Castro, supra, 154 Cal.App.4th 1162, are inapposite because the circumstances of the present case—in which plaintiff was a California resident when he was first diagnosed with an asbestos-related disease and when he incurred medical expenses in this state as a result of the disease—render this case analogous instead to the circumstances in Kearney, supra, 39 Cal.4th 95, in which the defendant’s conduct, although engaged in within another state, had the direct effect of causing an injury in California. In our view, the proposed analogy to Kearney is not persuasive. The present situation is not similar to that presented in Kearney, in which the defendant, while outside of California, participated in an interstate telephone call with a California resident who was in California and, where the defendant, in violation of California privacy law, recorded (without the California resident’s knowledge or consent) the words that were spoken by the California resident in California. Nor is this a case similar to one in which a defendant manufactures a product in another state and places the product in the stream of commerce under circumstances in which it is reasonably foreseeable that the product will make its way to California, and the product ultimately injures a person who uses it in California. (See, e.g., Buckeye Boiler Co. v. Superior Court (1969) 71 Cal.2d 893, 906 [80 Cal.Rptr. 113, 458 P.2d 57].) Instead, here plaintiff seeks to hold Foster Wheeler legally responsible for exposing him to asbestos in Oklahoma, and it is Oklahoma that bears the primary responsibility for regulating the conduct of those who create a risk of injury to persons within its borders.

*102 In arguing that Foster Wheeler should be viewed as having caused an injury that occurred in California, plaintiff relies heavily upon the circumstances that he was a resident of California when his exposure to asbestos many years earlier in Oklahoma ultimately manifested itself as an illness and caused him to incur considerable medical expenses resulting from the disease. Those circumstances, however, do not realistically distinguish the present matter from a case, such as Castro, supra, 154 Cal.App.4th 1162, in which a California resident is seriously injured in an automobile accident in another state and returns home to California for extensive medical treatment and long-term care. Although in such a case the plaintiff’s long-term medical expenses are likely to be incurred in California and, if the plaintiff’s resources are insufficient, the state ultimately may expend considerable financial resources for his or her care, past California choice-of-law decisions as we have seen have not treated that type of case as one in which a defendant’s conduct has caused an injury in California. Those decisions instead have applied the choice-of-law analysis discussed above, recognizing that the state in which the alleged injury-producing conduct occurred (and in which a significant risk of harm to others is posed) generally has the predominant interest in determining the appropriate parameters of liability for conduct undertaken within its borders. (Accord, Ferren v. General Motors Corp. (1993) 137 N.H. 423 [628 A.2d 265, 268-269] [choice-of-law decision applying law of state where exposure to lead dust occurred, rather than of state where the plaintiff resided when illness was later discovered]; Stephens v. Norwalk Hospital (D.Conn. 2001) 162 F.Supp.2d 36, 43-44 [choice-of-law decision applying statute of limitations of state where medical malpractice occurred, rather than of state where the plaintiff resided and where injury manifested itself].)

3

For the reasons discussed above, we conclude that Oklahoma’s interest (as embodied in its statute of repose) would be more impaired if its law were not applied under the circumstances of this case than would be California’s interest if its statute of limitations is not applied. Accordingly, we conclude that the Court of Appeal erred in holding that California law rather than Oklahoma law should apply to the issue before us. 14

*103 IV

The judgment of the Court of Appeal is reversed and the matter is remanded to that court with directions to address plaintiff’s additional contention that the trial court erred in finding that the boiler in question constituted an improvement to real property within the meaning of the relevant Oklahoma statute of repose. (See, ante, at p. 89, fn. 7.)

Kennard, J., Baxter, J., Werdegar, J., Chin, J., Moreno, J., and Corrigan, J., concurred.