210 U.S. 230 (1908)
Two Mississippi residents entered into contracts in Mississippi for cotton futures that violated state criminal statutes prohibiting such dealings without intent to deliver the commodity.1 The parties submitted their dispute to arbitration in Mississippi, but the submission did not include the question of the transaction's legality; an award was rendered against the defendant.2
When the prevailing party first attempted to sue on the award in a Mississippi court, the case was dismissed after the court was informed of the prohibited and criminal nature of the transactions.3 The prevailing party then located the defendant temporarily in Missouri and brought suit there on the award.4 The Missouri trial court refused to permit the defendant to introduce evidence showing the nature of the original transaction or its illegality under Mississippi law. Instead it directed a verdict for the plaintiff upon proof that the submission and award had been made and remained unpaid. Judgment was entered on that verdict.5 The judgment was later assigned to the plaintiff in error.6
The assignee brought an action on the Missouri judgment in a Mississippi court.7 The defendant pleaded the facts of the original Mississippi transaction, the arbitration, and the Missouri proceedings, asserting that the underlying cause was illegal and void.8 The plaintiff demurred on constitutional grounds. After the demurrer was overruled, replications again invoked the Constitution and were themselves demurred to.9 The Supreme Court of Mississippi held the plea good and the replications bad, entering judgment for the defendant.10 The case reached the Supreme Court of the United States on writ of error.11
Whether the Mississippi statute providing that futures contracts shall not be enforced by any court deprives Mississippi courts of jurisdiction over suits on such contracts or instead merely establishes a rule of decision?12
The distinction between jurisdiction and merits is plain. One goes to the power, the other only to the duty of the court. When a statute affects a court of general jurisdiction and deals with a matter upon which that court must pass, we naturally are slow to read ambiguous words as meaning to leave the judgment open to dispute. Such words are intended only to fix the rule by which the court should decide.13
No. The Mississippi statute merely establishes a rule of decision. The Mississippi court in which this action was brought is a court of general jurisdiction and would have to decide upon the validity of the bar if the suit upon the award or upon the original cause of action had been brought there. The words shall not be enforced by any court are simply another, possibly less emphatic, way of saying that an action shall not be brought to enforce such contracts. This is shown by the comparison to the statute of frauds in the same code.14
The statute establishes a rule of decision rather than depriving Mississippi courts of jurisdiction.15
Whether a Missouri judgment rendered on an award arising from a Mississippi futures transaction may be impeached in Mississippi on the ground that the underlying cause of action was illegal and void under Mississippi law?16
The judgment of a state court should have the same credit, validity, and effect in every other court in the United States which it had in the State where it was pronounced, and whatever pleas would be good to a suit thereon in such State, and none others, could be pleaded in any other court of the United States. A judgment is conclusive as to all the media concludendi and it cannot be impeached either in or out of the State by showing that it was based upon a mistake of law.17
No. The Missouri judgment was conclusive in Missouri on the validity of the cause of action. The trial court directed a verdict upon proof that the submission and award had been made and remained unpaid after refusing to allow evidence of the underlying transaction. Since the jurisdiction of the Missouri court is not open to dispute, the judgment cannot be impeached in Mississippi even if it went upon a misapprehension of the Mississippi law. This occurred when the assignee sued on the assigned judgment following dismissal of the initial Mississippi suit on the award.18
A Missouri judgment rendered on an award arising from a Mississippi futures transaction may not be impeached in Mississippi on the ground that the underlying cause of action was illegal and void under Mississippi law.19
Related opinions on this issue
Joined by Mr. Justice Harlan, Mr. Justice Mckenna, And Mr. Justice Day
Justice White dissented on the ground that the decision unduly expands the due faith and credit clause of the Constitution.20 The ruling would obliterate all state lines by endowing each State with authority to overthrow the public policy and criminal statutes of the others.21 The foundation upon which the system of government rests is the possession by the States of the right to exert their police powers as they may deem best for the happiness and welfare of those subject to their authority.22
The ruling now made deprives the States of powers admittedly theirs.23 White concluded that the Missouri judgment was not entitled to enforcement in Mississippi because it concerned transactions which had taken place exclusively in Mississippi between residents of that State which were in violation of laws embodying the public policy of that State.24