Sun Oil Co. v. Wortman

486 U.S. 717, 108 S. Ct. 2117, 100 L. Ed. 2d 743, 1988 U.S. LEXIS 2723, 56 U.S.L.W. 4601, 101 Oil & Gas Rep. 1

Opinions

Justice Scalia

delivered the opinion of the Court.

Petitioner Sun Oil Company seeks reversal of a decision of the Supreme Court of Kansas that it is liable for interest on certain previously suspended gas royalties. Wortman v. Sun Oil Co., 241 Kan. 226, 755 P. 2d 488 (1987) (Wortman III). The Kansas Supreme Court rejected petitioner’s contentions that (1) the Full Faith and Credit Clause of the Constitution, Art. IV, § 1, and the Due Process Clause of the Fourteenth Amendment prohibited application of Kansas’ statute of limitations so as to allow to proceed in Kansas courts a suit barred by the statute of limitations of the State whose substantive law governs the claim, and (2) those same Clauses of the Constitution mandated interpretations of other States’ substantive laws concerning interest that were different from those arrived at by the Kansas courts. We granted certiorari. 484 U. S. 912 (1987).

HH

In the 1960’s and 1970’s, petitioner, a Delaware corporation with its principal place of business in Texas, extracted gas from properties that it leased from respondents. The leases provided that respondents would receive a royalty, usually one-eighth of the proceeds, from the sale of gas. Petitioner sold the gas in interstate commerce at prices that had to be approved by the Federal Power Commission (FPC). The FPC permitted petitioner on several occasions to collect proposed increased prices from customers pending final approval, but required petitioner to refund with interest any amount so collected that was not ultimately approved. Specifically, petitioner had on file with the FPC an undertaking to comply with regulations, now codified at 18 CFR § 154.102 (1987), requiring petitioner to refund any ultimately unapproved increase plus interest at certain specified rates. §154.102(c). Petitioner made no royalty payments to respondents on the increased amounts collected until the FPC approved the increases. The respondents’ royalty shares of these increases have been called “suspended royalty payments” in this litigation.

In July 1976, petitioner paid respondents $1,167,000 in suspended royalty payments after the FPC approved increases that had been collected from July 1974 through April 1976. These payments covered 670 properties, 43.7% of which were located in Texas, 24% in Oklahoma, and 22.8% in Louisiana. In April 1978, petitioner paid respondents $2,676,000 in suspended royalty payments after the FPC approved increases that had been collected from December 1976 through April 1978. These payments covered 690 properties, 40.3% located in Texas, 31.6% in Oklahoma, and 23.6% in Louisiana.

In August 1979, respondents Richard Wortman and Hazel Moore filed a class action in a Kansas trial court on behalf of all landowners to whom petitioner had made or should have made suspended royalty payments, seeking interest on those payments for the period that the payments were held and used by petitioner. The trial court ruled that Kansas law governed all claims for interest, even claims relating to leases in another State and brought by residents of that State. The court further ruled that under Kansas law petitioner was liable for prejudgment interest at the rates petitioner had agreed to pay with respect to customer refunds under the FPC regulations. These rates were 7% per annum prior to October 10, 1974; 9% from then until September 30, 1979; and thereafter the average prime rate compounded quarterly. The trial court relied on Shutts v. Phillips Petroleum Co., 222 Kan. 527, 567 P. 2d 1292 (1977) (Shutts I), cert. denied, 434 U. S. 1068 (1978). That case, which also involved suspended royalty payments, had held that Kansas law gov-emed the claims of residents of other States concerning properties in those States, and that under Kansas law (1) the royalty owners were entitled to interest on suspended royalty payments because the royalty payments became owing under the royalty contract at the moment the gas company’s customers paid the increases and (2) the interest rate to be used was that set forth in the FPC regulations because the gas company’s corporate undertaking with the FPC constituted an agreement to pay that rate. See 222 Kan., at 562-565, 567 P. 2d, at 1317-1319.

The principles of Shutts I were reaffirmed in Shutts v. Phillips Petroleum Co., 235 Kan. 195, 679 P. 2d 1159 (1984) (Shutts II), a factually similar case involving suspended royalty payments different from those in Shutts I. The original decision of the trial court in this case was then affirmed on the strength of Shutts II in Wortman v. Sun Oil Co., 236 Kan. 266, 690 P. 2d 385 (1984) (Wortman I). The losing gas companies in both cases petitioned this Court for certiorari.

We reversed that part of Shutts II which held that Kansas could apply its substantive law to claims by residents of other States concerning properties located in those States, and remanded that case to the Kansas Supreme Court for application.of the governing law of the other States to those claims. Phillips Petroleum Co. v. Shutts, 472 U. S. 797, 816-823 (1985) (Shutts III). We also vacated the decision in Wort-man I and remanded it for reconsideration in light of our decision in Shutts III. Sun Oil Co. v. Wortman, 474 U. S. 806 (1985) (Wortman II).

On the remand in this case, the trial court held that under the law of the other States that had been held by Shutts III to govern the vast majority of claims, petitioner was liable for interest at the rate specified in the FPC regulations. The trial court further held that nothing in Shutts III precluded the application of Kansas’ 5-year statute of limitations to these claims, and that therefore claims for interest on the suspended royalty payments made in July 1976 were timely. The Kansas Supreme Court agreed with the first of these holdings in Shutts v. Phillips Petroleum Co., 240 Kan. 764, 732 P. 2d 1286 (1987) (Shutts IV), cert. pending, No. 87-348. The decision that the other States’ pertinent substantive legal rules were consistent with those of Kansas was reaffirmed in Wortman III, the decision we now review. Wort-man III also held that this Court’s decision in Shutts III applied only to substantive law, and not to procedural matters such as the appropriate statute of limitations.

HH HH

This Court has long and repeatedly held that the Constitution does not bar application of the forum State’s statute of limitations to claims that in their substance are and must be governed by the law of a different State. See, e. g., Wells v. Simonds Abrasive Co., 345 U. S. 514, 516-518 (1953); Townsend v. Jemison, 9 How. 407, 413-420 (1850); McElmoyle v. Cohen, 13 Pet. 312, 327-328 (1839). We granted certiorari to reexamine this issue. We conclude that our prior holdings are sound.

A

The Full Faith and Credit Clause provides:

"Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.”

The Full Faith and Credit Clause does not compel “a state to substitute the statutes of other states for its own statutes dealing with a subject matter concerning which it is competent to legislate.” Pacific Employers Ins. Co. v. Industrial Accident Comm’n, 306 U. S. 493, 501 (1939). Since the procedural rules of its courts are surely matters on which a State is competent to legislate, it follows that a State may apply its own procedural rules to actions litigated in its courts. The issue here, then, can be characterized as whether a statute of limitations may be considered as a procedural matter for purposes of the Full Faith and Credit Clause.

Petitioner initially argues that McElmoyle v. Cohen, supra, was wrongly decided when handed down. The holding of McElmoyle, that a statute of limitations may be treated as procedural and thus may be governed by forum law even when the substance of the claim must be governed by another State’s law, rested on two premises, one express and one implicit. The express premise was that this reflected the rule in international law at the time the Constitution was adopted. This is indisputably correct, see Le Roy v. Crowninshield, 15 F. Cas. 362, 365, 371 (No. 8,269) (Mass. 1820) (Story, J.) (collecting authorities), and is not challenged by petitioner. The implicit premise, which petitioner does challenge, was that this rule from international law could properly have been applied in the interstate context consistently with the Full Faith and Credit Clause.

The first sentence of the Full Faith and Credit Clause was not much discussed at either the Constitutional Convention or the state ratifying conventions. . However, the most pertinent comment at the Constitutional Convention, made by James Wilson of Pennsylvania, displays an expectation that would be interpreted against the background of principles developed in international conflicts law. See 2 M. Farrand, The Records of the Federal Convention of 1787, p. 488 (rev. ed. 1966). Moreover, this expectation was practically inevitable, since there was no other developed body of conflicts law to which courts in our new Union could turn for guidance.¹

The reported state cases in the decades immediately following ratification of the Constitution show that courts looked without hesitation to international law for guidance in resolving the issue underlying this case: which State’s law governs the statute of limitations. The state of international law on that subject being as we have described, these early decisions uniformly concluded that the forum’s statute of limitations governed even when it was longer than the limitations period of the State whose substantive law governed the merits of the claim. See Nash v. Tupper, 1 Cai. 402, 412-413 (N. Y. 1803) (citing unreported 1795 New York case, Page v. Cable, holding the same); Pearsall v. Dwight, 2 Mass. 84, 89-90 (1806); Ruggles v. Keeler, 3 Johns. 263, 267-268 (N. Y. 1808) (Kent, C. J.); Graves v. Graves’s Executor, 5 Ky. 207, 208-209 (1810). By 1820, the use of the forum statute of limitations in the interstate context was acknowledged to be “well settled.” Medbury v. Hopkins, 3 Conn. 472, 473 (1820); accord, Le Roy v. Crowninshield, supra, at 371 (“settled”); cf. McCluny v. Silliman, 3 Pet. 270, 276-277 (1830) (“well settled”); Hawkins v. Barney’s Lessee, 5 Pet. 457, 466 (1831) (“not to be questioned”). Obviously, judges writing in the era when the Constitution was framed and ratified thought the use of the forum statute of limitations to be proper in the interstate context. Their implicit understanding that the Full Faith and Credit Clause did not preclude reliance on the international law rule carries great weight.

Moreover, this view of statutes of limitations as procedural for purposes of choice of law followed quite logically from the manner in which they were treated for domestic-law purposes. At the time the Constitution was adopted the rule was already well established that suit would lie upon a promise to repay a debt barred by the statute of limitations — on the theory, as expressed by many courts, that the debt constitutes consideration for the promise, since the bar of the statute does not extinguish the underlying right but merely causes the remedy to be withheld. See Little v. Blunt, 26 Mass. 488, 492 (1830) (“[T]he debt remained, the remedy was gone”); see also Wetzell v. Bussard, 11 Wheat. 309, 311 (1826). This is the same theory, of course, underlying the conflicts rule: the right subsists, and the forum may choose to allow its courts to provide a remedy, even though the jurisdiction where the right arose would not. See Graves v. Graves’s Executor, supra, at 208-209 (“The statute of limitations . . . does not destroy the right but withholds the remedy. It would seem to follow, therefore, that the lex fori, and not the lex loci was to prevail with respect to the time when the action should be commenced”).

The historical record shows conclusively, we think, that the society which adopted the Constitution did not regard statutes of limitations as substantive provisions, akin to the rules governing the validity and effect of contracts, but rather as procedural restrictions fashioned by each jurisdiction for its own courts. As Chancellor Kent explained in his landmark work, 2 J. Kent, Commentaries on American Law 462-463 (2d ed. 1832): “The period sufficient to constitute a bar to the litigation of sta[l]e demands, is a question of municipal policy and regulation, and one which belongs to the discretion of every government, consulting its own interest and convenience.”

Unable to sustain the contention that under the original understanding of the Full Faith and Credit Clause statutes of limitations would have been considered substantive, petitioner argues that we should apply the modern understanding that they are so. It is now agreed, petitioner argues, that the primary function of a statute of limitations is to balance the competing substantive values of repose and vindication of the underlying right; and we should apply that understanding here, as we have applied it in the area of choice of law for purposes of federal diversity jurisdiction, where we have held that statutes of limitations are substantive, see Guaranty Trust Co. v. York, 326 U. S. 99 (1945).

To address the last point first: Guaranty Trust itself rejects the notion that there is an equivalence between what is substantive under the Erie doctrine and what is substantive for purposes of conflict of laws. 326 U. S., at 108. Except at the extremes, the terms “substance” and “procedure” precisely describe very little except a dichotomy, and what they mean in a particular context is largely determined by the purposes for which the dichotomy is drawn. In the context of our Erie jurisprudence, see Erie R. Co. v. Tompkins, 304 U. S. 64 (1938), that purpose is to establish (within the limits of applicable federal law, including the prescribed Rules of Federal Procedure) substantial uniformity of predictable outcome between cases tried in a federal court and cases tried in the courts of the State in which the federal court sits. See Guaranty Trust, supra, at 109; Hanna v. Plumer, 380 U. S. 460, 467, 471-474 (1965). The purpose of the substance-procedure dichotomy in the context of the Full Faith and Credit Clause, by contrast, is not to establish uniformity but to delimit spheres of state legislative competence. How different the two purposes (and hence the appropriate meanings) are is suggested by this: It is never the case under Erie that either federal or state law — if the two differ — can properly be applied to a particular issue, cf. Erie, supra, at 72-73;. but since the legislative jurisdictions of the States overlap, it is frequently the case under the Full Faith and Credit Clause that a court can lawfully apply either the law of one State or the contrary law of another, see Shutts III, 472 U. S., at 823 (“[I]n many situations a state court may be free to apply one of several choices of law”). Today, for example, we do not hold that Kansas' must apply its own statute of limitations to a claim governed in its substance by another State’s law, but only that it may.

But to address petitioner’s broader point of which the Erie argument is only a part — that we should update our notion of what is sufficiently “substantive” to require full faith and credit: We cannot imagine what would be the basis for such an updating. As we have just observed, the words “substantive” and “procedural” themselves (besides not appearing in the Full Faith and Credit Clause) do not have a precise content, even (indeed especially) as their usage has evolved. And if one consults the purpose of their usage in the full-faith-and-credit context, that purpose is quite simply to give both the forum State and other interested States the legislative jurisdiction to which they are entitled. If we abandon the currently applied, traditional notions of such entitlement we would embark upon the enterprise of constitutionalizing choice-of-law rules, with no compass to guide us beyond our own perceptions of what seems desirable.² There is no more reason to consider recharacterizing statutes of limitation as substantive under the Full Faith and Credit Clause than there is to consider recharacterizing a host of other matters generally treated as procedural under conflicts law, and hence generally regarded as within the forum State’s legislative jurisdiction. See, e. g., Restatement (Second) of Conflict of Laws § 131 (remedies available), § 133 (placement of burden of proof), § 134 (burden of production), § 135 (sufficiency of the evidence), § 139 (privileges) (1971).

In sum, long established and still subsisting choice-of-law practices that come to be thought, by modem scholars, unwise, do not thereby become unconstitutional. If current conditions render it desirable that forum States no longer treat a particular issue as procedural for conflict of laws purposes, those States can themselves adopt a rule to that effect, e. g., Heavner v. Uniroyal, Inc., 63 N. J. 130, 135-141, 305 A. 2d 412, 415-418 (1973) (statute of limitations), or it can be proposed that Congress legislate to that effect under the second sentence of the Full Faith and Credit Clause, cf. Mills v. Duryee, 7 Cranch 481, 485 (1813); Pacific Employers Ins. Co. v. Industrial Accident Comm’n, 306 U. S., at 502. It is not the function of this Court, however, to make departures from established choice-of-law precedent and practice constitutionally mandatory. We hold, therefore, that Kansas did not violate the Full Faith and Credit Clause when it applied its own statute of limitations.

B

Petitioner also makes a due process attack upon the Kansas court’s application of its own statute of limitations.³ Here again neither the tradition in place when the constitutional provision was adopted nor subsequent practice supports the contention. At the time the Fourteenth Amendment was adopted, this Court had not only explicitly approved (under the Full Faith and Credit Clause) forum-state application of its own statute of limitations, but the practice had gone essentially unchallenged. And it has gone essentially unchallenged since. “If a thing has been prac-tised for two hundred years by common consent, it will need a strong case for the Fourteenth Amendment to affect it.” Jackman v. Rosenbaum Co., 260 U. S. 22, 31 (1922).

A State’s interest in regulating the workload of its courts and determining when a claim is too stale to be adjudicated certainly suffices to give it legislative jurisdiction to control the remedies available in its courts by imposing statutes of limitations. Moreover, petitioner could in no way have been unfairly surprised by the application to it of a rule that is as old as the Republic. There is, in short, nothing in Kansas’ action here that is “arbitrary or unfair,” Shutts III, 472 U. S., at 821-822, and the due process challenge is entirely without substance.

Ill

In Shutts III, we held that Kansas could not apply its own law to claims for interest by nonresidents concerning royalties from property located in other States. The Kansas Supreme Court has complied with that ruling, but petitioner claims that it has unconstitutionally distorted Texas, Oklahoma, and Louisiana law in its determination of that law made in Shutts IV and applied to this case in Wortman III.

To constitute a violation of the Full Faith and Credit Clause or the Due Process Clause, it is not enough that a state court misconstrue the law of another State. Rather, our cases make plain that the misconstruction must contradict law of the other State that is clearly established and that has been brought to the court’s attention. See, e. g., Pennsylvania Fire Ins. Co. v. Gold Issue Mining & Milling Co., 243 U. S. 93, 96 (1917); Western Life Indemnity Co. v. Rupp, 235 U. S. 261, 275 (1914); Louisville & Nashville R. Co. v. Melton, 218 U. S. 36, 51-52 (1910); Banholzer v. New York Life Ins. Co., 178 U. S. 402, 408 (1900); see also Shutts III, supra, at 834-842 (Stevens, J., concurring in part and dissenting in part). We cannot conclude that any of the interpretations at issue here runs afoul of this standard.

1. Texas: Petitioner contests the Kansas Supreme Court’s interpretation of Texas law on the interest rate. Texas’ statutory rate of 6% does not apply when a “specified rate of interest is agreed upon by the parties.” Tex. Rev. Civ. Stat. Ann., Art. 5069-1.03 (Vernon 1987). Such an agreement need not be express, but can be inferred from conduct. See Preston Farm & Ranch Supply, Inc. v. Bio-Zyme Enterprises, 625 S. W. 2d 295, 298, 300 (Tex. 1981). The Kansas court held an agreement to pay interest at a higher rate was implied by petitioner’s undertaking with the FPC to comply with federal regulations setting forth the applicable rates of interest for refundable moneys held in suspense. See Shutts IV, 240 Kan., at 777, 783-784, 790-791, 732 P. 2d, at 1298, 1302, 1306; see also Shutts I, 222 Kan., at 562-565, 567 P. 2d, at 1317-1319.

Petitioner brought to the Kansas court’s attention no Texas decision clearly indicating that an agreement to pay interest at a specified rate would not be implied in these circumstances.⁴ Petitioner’s reliance on Phillips Petroleum Co. v. Stahl Petroleum Co., 569 S. W. 2d 480 (Tex. 1978), is misplaced. Although that , case was similar to the present one on its facts, the point at issue here was neither raised nor decided. In Stahl, the intermediate Texas court had ordered interest paid at the statutory 6% rate. There is nothing to indicate, however, that the royalty owner had requested anything else, and only the lessee and not the royalty owner appealed. Id., at 481. Thus, the Texas Supreme Court’s holding that 6% interest was payable is in no way a holding that more than 6% was not. It is far from unconstitutional for the Kansas Supreme Court to anticipate that the Texas Supreme Court would distinguish the case on the eminently reasonable ground that no rate of interest based on an implied agreement was at issue.

2. Oklahoma: Petitioner contests the Kansas Supreme Court’s interpretations of Oklahoma law as to both liability for interest and the rate to be paid. Concerning liability, petitioner relies on a statute providing that “[accepting payment of the whole principal, as such, waives all claim to interest.” Okla. Stat., Tit. 23, §8 (1981). But the Oklahoma Supreme Court has held that this statute does not bar a claim for interest based on an implied agreement to pay interest, since in that event the interest becomes, for purposes of the statute, part of the “principal” owed. See Webster Drilling Co. v. Sterling Oil of Oklahoma, Inc., 376 P. 2d 236, 238 (1962). Regarding the rate of interest, Oklahoma law provides for 6% only “in the absence of any contract as to the rate of interest, and by contract the parties may agree to any rate as may be authorized by law.” Okla. Stat., Tit. 15, § 266 (1981). Thus, for Oklahoma as for Texas, petitioner’s contention founders on the fact that it pointed to no decision indicating that an agreement to pay more than 6% interest would not be implied in circumstances such as those of the present case.

3. Louisiana: Finally, petitioner contests the Kansas Supreme Court’s interpretation of Louisiana law both as to liability for interest and the rate to be paid. Concerning liability, petitioner relies on Whitehall Oil Co. v. Boagni, 217 So. 2d 707 (La. App. 1968), aff’d on other issues, 255 La. 67, 229 So. 2d 702 (1969). That case involved a situation opposite from that involved here: the gas companies had paid the royalties on increased prices before FPC approval, and were seeking interest on those payments when the approval did not ensue. It thus involved a claim for unjust enrichment, see 217 So. 2d, at 709, and does not stand for the proposition that no interest is recoverable on a contractual debt — which would arguably (if not inevitably) have been governed by the Louisiana statute mandating interest on “[a]ll debts . . . from the time they become due.” La. Civ. Code Ann., Art. 1938 (West 1977); see also Wurzlow v. Placid Oil Co., 279 So. 2d 749, 772-774 (La. App.) (applying Art. 1938 to oil and gas royalties), cert,. denied, 282 So. 2d 140 (La. 1973).

As to petitioner’s claim that if interest was payable Louisiana’s 7% rate clearly applied: The 7% rate specified in the above-quoted statute applied “unless otherwise stipulated.” Art. 1938. Petitioner brought to the Kansas court’s attention no Louisiana decision indicating that an implied agreement could not constitute such a stipulation, or that an implied agreement would not be found in the circumstances of this case. Cf. Boutte v. Chevron Oil Co., 316 F. Supp. 524, 531 (ED La. 1970) (dictum) (gas company will owe royalty owner interest at FPC rates on suspended royalty payments once FPC approves increases), aff’d, 442 F. 2d 1337 (CA5 1971).

* * *

For the reasons stated, the judgment of the Kansas Supreme Court is

Affirmed.

Justice Kennedy took no part in the consideration or decision of this case. .

1 Justice Brennan’s concurrence, post, at 740, misunderstands the famous statement from Milwaukee County v. M. E. White Co., 296 U. S. 268, 276-277 (1935), that “[t]he very purpose of the full faith and credit clause was to alter the status of the several states as independent foreign sovereignties.” This statement is true, as the context of the statement in Milwaukee County makes clear, not because the Clause itself radically changed the principles of conflicts law but because it made conflicts principles enforceable as a matter of constitutional command rather than leaving enforcement to the vagaries of the forum’s view of comity. See Estin v. Estin, 334 U. S. 541, 546 (1948) (the Full Faith and Credit Clause “substituted a command for the earlier principles of comity and thus basically altered the status of the States as independent sovereigns”) (emphasis added).

The concurrence’s assertion, post, at 740-741, n. 3, that Milwaukee County did not rely upon international conflicts law is entirely beside the point. It is not our point that the content of the Full Faith and Credit Clause is governed by international conflicts law, but only (in order to meet petitioner’s contention that McElmoyle was wrong when decided) that its original content was properly derived from that source. The conflicts law embodied in the Full Faith and Credit Clause allows room for common-law development, just as did the international conflicts law that it originally embodied. But the concurrence points to no such common-law development. The rule applied in McElmoyle continues to be the rule applied by most of the States. Nor, contrary to what the concurrence says, post, at 740-741, n. 3, did Milwaukee County strike down a practice that was in accord with then-accepted conflicts principles. Although the Restatement of Conflicts of Laws § 443 (1934) had taken the position that a judgment for taxes was not enforceable in another State, our opinion noted that “[t]he precise question now presented appears to have been decided in only a single case, New York v. Coe Manufacturing Co., 112 N. J. L. 536, 172 Atl. 198 [(1934)],” which held, as did this Court, that such a judgment was enforceable. 296 U. S., at 278-279. The opinion took some pains, moreover, to distinguish the traditional conflicts rules that one State need not entertain an action for taxes based on another State’s statute, id., at 274-277; see also id., at 279, and that generally one State need not enforce a judgment from another State for a penalty, see id., at 279-280. Cf. Restatement of Conflicts of Laws § 443, Comment d (1948 Supp.) (money judgments based on tax claims are enforceable “since such claims are not deemed penalties”).

2 Contrary to Justice Brennan’s concurrence, post, at 739-742, there is nothing unusual about our approach. This Court has regularly relied on traditional and subsisting practice in determining the constitutionally permissible authority of courts. See, e. g., Young v. United States ex rel. Vuitton et Fils, S. A., 481 U. S. 787, 795, and n. 7 (1987) (Article III); Tull v. United States, 481 U. S. 412, 417-421 (1987) (Seventh Amendment); Aetna Life Ins. Co. v. Lavoie, 475 U. S. 813, 820-821 (1986) (disqualification of judges); Press-Enterprise Co. v. Superior Court of California, Riverside County, 464 U. S. 501, 505-508 (1984) (openness of jury selection process); Northern Pipeline Construction Co. v. Marathon Pipe Line Co., 458 U. S. 50, 57-60, and nn. 10-11, 64-76, and nn. 15, 25, 86-87, n. 39 (1982) (plurality opinion of Brennan, J., joined by Marshall, Blackmun, and Stevens, JJ.) (Article III); id., at 90-91 (Rehnquist, J., joined by O’Connor, J., concurring in judgment); United States v. Nixon, 418 U. S. 683, 696 (1974) (“In the constitutional sense, controversy . . . means the kind of controversy courts traditionally resolve”). The concurrence’s citation, post, at 740, of the criticism by the plurality opinion in Allstate Ins. Co. v. Hague, 449 U. S. 302 (1981), of Hartford Accident & Indemnity Co. v. Delta & Pine Land Co., 292 U. S. 143 (1934), is not to the contrary. That criticism merely rejected the view that the Constitution enshrines the rule that the law of the place of contracting governs validity of all provisions of the contract. By the time of Allstate, of course., such a rule could not have been characterized as a subsisting tradition, if it ever could have been, in light of escape devices such as the doctrine of public policy, characterization of an issue as procedural, and the rule that the law of the place of performance governs matters of performance.

3 Although petitioner takes up this issue after discussion of the full-faith- and-credit claim, and devotes much less argument to it, we may note that, logically, the full-faith-and-eredit claim is entirely dependent upon it. It cannot possibly be a violation of the Full Faith and Credit Clause for a State to decline to apply another State’s law in a case where that other State itself does not consider it applicable. Although in certain circumstances standard conflicts law considers a statute of limitations to bar the right and not just the remedy, see Restatement (Second) of Conflict of Laws § 143 (1971), petitioner concedes, see Tr. of Oral Arg. 4-5, that (apart from the fact that Kansas does not so regard the out-of-state statutes of limitations at issue here) Texas, Oklahoma, and Louisiana view their own statutes as procedural for choice-of-law purposes, see, e. g., Los Angeles Airways, Inc. v. Lummis, 603 S. W. 2d 246, 248 (Tex. Civ. App. 1980), cert. denied, 455 U. S. 988 (1982); Western Natural Gas Co. v. Cities Service Gas Co., 507 P. 2d 1236, 1242 (Okla.), cert. denied, 409 U. S. 1052 (1972); Kirby Lumber Co. v. Hicks Co., 144 La. 473, 475, 80 So. 663 (1919). A full-faith-and-credit problem can therefore arise only if that disposition by those other States is invalid — that is, if they, as well as Kansas, are compelled to consider their statutes of limitations substantive. The nub of the present controversy, in other words, is the scope of constitutionally permissible legislative jurisdiction, and it matters little whether that is discussed in the context of the Full Faith and Credit Clause, as the litigants have principally done, or in the context of the Due Process Clause. Since we are largely traversing ground already covered, our discussion of the due process claim can be brief.

4 The partial dissent’s dissatisfaction with our decision to let stand Kansas’ interpretation of Texas law, as well as Oklahoma and Louisiana law, see infra, at 733-734, appears to rest on two premises: (1) That respondents have some threshold burden of supporting Kansas’ interpretation of what the other States’ laws would likely be, post, at 743-744, 745-746, 746-747, 748, and (2) that respondents have not met that burden because Kansas’ view of contract law is a manifest departure from normal and proper principles of contract law. Post, at 746, 748-749. We think neither premise is correct.

First, placing the initial burden on respondents to support the Kansas court’s interpretations is flatly inconsistent with the precedent of this Court. Relief cannot be granted in this Court unless decisions plainly contradicting the Kansas court’s interpretations were brought to the Kansas court’s attention. See, e. g., Western Life Indemnity Co. v. Rupp, 235 U. S. 261, 275 (1914) (“If such decision existed, it was incumbent upon defendant to prove it as matter of fact”); Texas & N. O. R. Co. v. Miller, 221 U. S. 408, 416 (1911) (“There was neither allegation nor proof that the court of last resort in Louisiana had considered the question or made any ruling upon it, and so it became the duty of the Texas courts ... to decide the question according to their independent judgment”); Louisville & Nashville R. Co. v. Melton, 218 U. S. 36, 52 (1910) (“[S]uch settled construction must be pleaded and proved”).

Second, the partial dissent appears to assume that contract law requires a promisor to make a conscious assumption of an obligation in order to be bound. It is standard contract law, however, that a party may be bound by a custom or usage even though he is unaware of it, and indeed even if he positively intended the contrary. See U. C. C. §§ 1-201(3), 1-205(3), and Comment 4, 1 U. L. A. 44, 84, 85 (1976); Restatement (Second) of Contracts § 221, and Comment a (1981). The Kansas Supreme Court considered petitioner’s undertaking with the FPC (as well as the reference to a similar undertaking in an indemnity agreement proposed by another oil company to its lessors) to be evidence of an industry usage (or “common understanding,” U. C. C. § 1-205, Comment 4, 1 U. L. A. 86) that in a case such as the present one interest would be paid at the FPC-prescribed rates. See Shutts IV, 240 Kan., at 784, 732 P. 2d, at 1302 (describing undertaking with FPC as showing “industry practice”). Especially since the existence and scope of a particular usage is usually a question of fact, see U. C. C. § 1-205(2), 1 U. L. A. 84; Restatement (Second) of Contracts § 219, Comment a; § 222(2), it seems particularly inappropriate to suggest that the Kansas court, without having been referred to any decisions on the subject from the other States, should have known that its decision was contrary to the law of those other States.