Syllabus. ANGEL v. BULLINGTON. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FOURTH CIRCUIT. No. 31. Argued March 5, 1946. Reargued November 18, 19, 1946.Decided February 17, 1947. There the plaintiff conprecluded the State from Disclaiming any intention A citizen of Virginia sued a citizen of North Carolina in a state court of North Carolina for a deficiency judgment on notes for the purchase price of land in Virginia secured by a deed of trust on the land. The defendant demurred, relying on N. C. L., 1933, c. 36, Michie's N. C. Code § 2593 (f), which provides that the holder of such a note "shall not be entitled to a deficiency judgment." The trial court overruled the demurrer and the defendant appealed to the State Supreme Court. tended that the Federal Constitution closing the doors of its courts to him. of passing on any question of substantive law, the State Supreme Court held that the state statute denied the state courts jurisdiction to grant the relief sought. Accordingly, it reversed the trial court and dismissed the suit. Without appealing to this Court, the plaintiff brought a new suit in a Federal District Court in North Carolina on the ground of diversity of citizenship, seeking the same relief against the same defendant on the same claim. Held: The identical issue having been finally adjudicated in the state courts and the cause of action being barred there, it may not be relitigated in the federal courts. Pp. 186-193. (a) The federal question as to the constitutionality of the state statute having been clearly raised in the State Supreme Court, it necessarily was adjudicated by that Court, notwithstanding the Court's disclaimer of any intention to pass on any question of "substantive law." Pp. 187-188. (b) The plaintiff could have appealed to this Court. Since he elected not to do so, the decision of the State Supreme Court became a final adjudication of that question as to this cause of action. Pp. 188-190. (c) Since the only issue in the state courts was whether all courts of the State were closed to the litigation and the State Supreme Court held that they were, thereby denying enforcement of an asserted federal claim, the "merits" of the controversy were Opinion of the Court. 330 U.S. adjudicated in the only sense that adjudication of the "merits" is relevant to the principles of res judicata. Pp. 190-191. (d) The decision of the State Supreme Court closed the door not only to the suit in the state courts but also to a similar suit in a federal court in North Carolina based on diversity of citizenship, since a federal court in such a suit must follow state law and policy. Erie R. Co. v. Tompkins, 304 U. S. 64. Pp. 191-192. 150 F. 2d 679, reversed. In a suit by a citizen of Virginia against a citizen of North Carolina, the Supreme Court of North Carolina held that N. C. L., 1933, c. 36, Michie's N. C. Code § 2593 (f) denied the state courts jurisdiction to grant a deficiency judgment on a purchase-money note secured by a deed of trust on land in Virginia. 220 N. C. 18, 16 S. E. 2d 411. The plaintiff in that suit then brought a new suit on the same claim in a Federal District Court in North Carolina on grounds of diversity of citizenship. The District Court gave judgment for the plaintiff. The Circuit Court of Appeals affirmed. 150 F. 2d 679. This Court granted certiorari. 326 U. S. 713. Reversed, p. 193. George Lyle Jones argued the cause for petitioner. With him on the brief was George H. Ward. R. Roy Rush argued the cause for respondent. With him on the brief was John L. Walker. MR. JUSTICE FRANKFURTER delivered the opinion of the Court. In 1940, Bullington, a citizen of Virginia, sold land in Virginia to Angel, a citizen of North Carolina. Only part of the purchase price was paid. For the balance, Angel executed a series of notes secured by a deed of trust on the land. 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 trus tees to sell the land. The sale was duly made in Virginia and the proceeds of the sale applied to the payment of the notes. This controversy concerns attempts to collect the deficiency. Bullington began suit for the deficiency in the Superior Court of Macon County, North Carolina. 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. This is the relevant portion of that enactment: "In all sales of real property by mortgagees and/or The Superior Court overruled the demurrer, and an appeal to the Supreme Court of North Carolina followed. Bullington supported his Superior Court judgment on the ground that the United States Constitution precluded North Carolina from shutting the doors of its courts to him. 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. 220 N. C. 18, 16 S. E. 2d 411. Bullington did not seek to review this judgment here. Instead, he sued Angel for the deficiency in the United States District Court for the Western District of North Carolina. Angel pleaded in bar the judgment in the North Carolina action. The District Court gave judgment for Bullington, 56 F. Supp. 372, and the Circuit Court of Appeals for the Fourth Circuit affirmed. 150 F. 2d 679. We granted certiorari, 326 U. S. 713, because the failure Opinion of the Court. 330 U.S. 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. 1. We start with the fact that the prevailing rule as to res judicata is settled law in North Carolina. An adjudication bars future litigation between the same parties not only as to all issues actually raised and decided but also as to those which could have been raised. Southern Distributing Co. v. Carraway, 196 N. C. 58, 60–61, 144 S. E. 535, 537; Moore v. Harkins, 179 N. C. 167, 101 S. E. 564. When the disposition of a prior litigation is invoked as a bar to an action, the identity of the causes of action in the two suits is usually the bone of contention. On this score there can here be no controversy. It is indisputable that 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, first in the Superior Court of Macon County and then in the federal district court. For all practical purposes, the complaint in the present action was a carbon copy of the complaint in the State court action. If the North Carolina action had been dismissed because it was brought in one North Carolina court rather than in another, of course no federal issue would have been involved. See, e. g., Woods v. Nierstheimer, 328 U. S. 211. Had that been the case, a suit for the same cause of action could have been initiated in a North Carolina federal district court, just as another suit could have been brought in the proper North Carolina State court. But that is not the present situation. A quite different situation is before us. Being somewhat unusual, it calls for a critical consideration of the scope and purpose of the doctrine of res judicata. 2. The judgment of the Supreme Court of North Carolina would clearly bar this suit had it been brought anew in a state court. For purposes of diversity jurisdiction a federal court is, "in effect, only another court of the State." Guaranty Trust Co. v. York, 326 U. S. 99, 108; see Traction Company v. Mining Company, 196 U. S. 239, 253; Ex parte Schollenberger, 96 U. S. 369, 377. Of course, Bullington could not have succeeded in the District Court for the Western District of North Carolina after an adverse judgment in the State courts, had the decision in this case involved no federal ground. That is equally true where a federal question was decided in the State courts. That the adjudication of federal questions by the North Carolina Supreme Court may have been erroneous is immaterial for purposes of res judicata. Baltimore S. S. Co. v. Phillips, 274 U. S. 316, 325. A higher court was available for an authoritative adjudication of the federal questions involved. And so the question is whether federal rights were necessarily involved and adjudicated in the litigation in the State courts. 3. For purposes of res judicata, the significance of what a court says it decides is controlled by the issues that were open for decision. What were the issues in the North Carolina litigation? Bullington sought a deficiency judgment. Angel, by demurrer, resisted on the ground that a North Carolina statute precluded a deficiency judgment. The North Carolina Supreme Court, reversing the trial court, found the North Carolina statute a bar to such a suit. It said that "the limitation created by the statute is upon the jurisdiction of the court in that it is declared that the holder of notes given to secure the purchase price of real property 'shall not be entitled to a deficiency judgment on account' thereof. This closes the courts of this State to one who seeks a deficiency judgment on a note given for the purchase price of real property. The statute operates upon the adjective law of the State, which pertains to the practice and procedure, |