330 U.S. 183 (1947)
In 1940, Bullington, a citizen of Virginia, sold land in Virginia to Angel, a citizen of North Carolina.1 Only part of the purchase price was paid.2 For the balance, Angel executed a series of notes secured by a deed of trust on the land.3
Upon default on one of the notes, Bullington, acting upon an acceleration clause in the deed, caused all other notes to become due and called upon the trustees to sell the land.4 The sale was duly made in Virginia and the proceeds of the sale applied to the payment of the notes.5 This controversy concerns attempts to collect the deficiency.6
Bullington began suit for the deficiency in the Superior Court of Macon County, North Carolina.7 Angel countered with a demurrer, the substance of which was that a statute of North Carolina (c. 36, Public Laws 1933, Michie's Code § 2593 (f)) precluded recovery of such a deficiency judgment.8 The Superior Court overruled the demurrer, and an appeal to the Supreme Court of North Carolina followed.9 The North Carolina Supreme Court, holding that the North Carolina Act of 1933 barred Bullington's suit against Angel, reversed the Superior Court and dismissed the action.10 Bullington did not seek to review this judgment here.11
Instead, he sued Angel for the deficiency in the United States District Court for the Western District of North Carolina.12 Angel pleaded in bar the judgment in the North Carolina action.13 The District Court gave judgment for Bullington, and the Circuit Court of Appeals for the Fourth Circuit affirmed.14 The Supreme Court granted certiorari because the failure to dismiss this action, on the ground that the judgment in the North Carolina court precluded the right thereafter to recover on the same cause of action in the federal court, presented an important question in the administration of justice.15
Whether the judgment of the Supreme Court of North Carolina dismissing Bullington's suit for a deficiency judgment bars his subsequent action for the same deficiency in the United States District Court for the Western District of North Carolina?16
Yes. The parties, the nature of the claim, and the desired relief were precisely the same in the two actions successively brought by Bullington against Angel.19 The North Carolina Supreme Court adjudicated the federal constitutional claims Bullington raised regarding the statute's validity under the Contract Clause, Full Faith and Credit Clause, and Privileges or Immunities Clause.20 It did so by characterizing the bar as a limitation on the jurisdiction of the courts of the State that operated upon adjective law rather than substantive law.21
Because Bullington did not seek review of that judgment in the Supreme Court, the decision of the North Carolina Supreme Court concluded an adjudication of a federal question.22 This bars the subsequent action in the federal district court sitting in the same state.23
The judgment of the Supreme Court of North Carolina bars Bullington's subsequent action for the deficiency in the United States District Court for the Western District of North Carolina.24
Related opinions on this issue
Joined by Justices Jackson And Rutledge
Justice Reed dissented on the ground that the North Carolina judgment was not on the merits but merely a denial of jurisdiction.25 Therefore res judicata does not bar the federal suit. He maintained that the North Carolina court decided only that it had no power to adjudicate the cause of action.26
Federal courts are not bound by state jurisdictional limitations in the same manner as state courts.27 Reed argued that the Guaranty Trust rule applies only to substantive law.28 It does not extend to procedure and jurisdiction.29
This leaves the federal court free to entertain the diversity action.30
Joined by Justice Jackson
Justice Rutledge dissented, contending that the majority misapplied both res judicata and Erie doctrines.31 It did so by treating a jurisdictional dismissal as preclusive on substantive issues.32 He emphasized that Bullington had not received a full and fair opportunity to litigate the merits of his claim.33
The remote chance of success on appeal to this Court did not justify barring him from starting over in federal court.34 Rutledge maintained that the proper question was whether the state decision created substantive policy that would make the Erie rule applicable.35 The admixture of doctrines produced bad law without giving Bullington one full day in court on the substance of his claim.36