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34 F.3d 1066
NOTICE: Fourth Circuit I.O.P. 36.6 states that citation of unpublished dispositions is disfavored except for establishingres judicata, estoppel, or the law of the case and requiresservice of copies of cited unpublished dispositions of the FourthCircuit.James A. HENSON, Plaintiff-Appellee,v.GTE PRODUCTS CORPORATION, Defendant-Appellant.
 No. 93-1862.
United States Court of Appeals, Fourth Circuit.
 Argued February 9, 1994. Decided September 1, 1994.
Appeal from the United States District Court for the District of SouthCarolina, at Columbia. Matthew J. Perry, Jr., District Judge. (CA-91-2194-3-0).Argued: Jeffrey Alan Jacobs, Nelson, Mullins, Riley & Scarborough,Columbia, SC. On brief: Thornwell F. Sowell, Nelson, Mullins, Riley &Scarborough, Columbia, SC, for Appellant.Argued: James B. Richardson, Jr., Svalina, Richardson & Smith,Columbia, SC. On brief: Gerald F. Smith, Svalina, Richardson & Smith,Columbia, SC, for Appellee.D.S.C.AFFIRMED AND REMANDED.Before NIEMEYER, Circuit Judge, BUTZNER, Senior Circuit Judge, andELLIS, United States District Judge for the Eastern District of Virginia,sitting by designation.OPINIONBUTZNER, Senior Circuit Judge:
 
1The principal issue in this appeal is whether the Contract Clause barsenforcement of a South Carolina statute that authorizes an award of punitivedamages and attorney fees against a manufacturer who fails to pay amounts dueto a sales representative after termination of the parties' contract. The districtcourt found no bar and entered judgment on the verdict of a jury awardingdamages to James A. Henson, a former sales representative of SylvaniaLighting. The appellant assigns error to the judgment and to a number of rulingsthe district court made. Finding no cause for reversal, we affirm.2* Sylvania Lighting was a division of GTE Products Corporation. Pending thislitigation, GTE sold the division to OSRAM GmbH, which is a subsidiary of Siemens GmbH. The district court and the parties have referred to thedefendant as Sylvania, and we will do the same. Expressing dissatisfaction withSylvania, Henson resigned in 1990 and brought suit for unpaid commissions, punitive damages, and attorney fees. Sylvania filed a counterclaim alleging thatHenson had breached the contract.3The contract provided that it should be construed and enforced according toMassachusetts law. Sylvania asserts that it is not liable for punitive damagesand attorney fees because Massachusetts does not allow these damages and feesin contract cases.4Henson, however, relies on Chapter 65 of the South Carolina Code Secs. 39-65-10 to 39-65-70 concerning payment of post-termination claims to salesrepresentatives. If payment is not made, S.C.Code Sec. 39-65-30 provides that asales representative is entitled to punitive damages and attorney fees. Section39-65-70 provides: "A provision in any contract between a sales representativeand a principal purporting to waive any provision of this chapter, whether byexpressed waiver or by a contract subject to the laws of another state, is void."Section 39-65-70, Henson says, requires the court to apply South Carolina law,not Massachusetts law, to determine the availability of punitive damages andattorney fees.5Sylvania counters by asserting that the Contract Clause of the United StatesConstitution renders Chapter 65 unconstitutional because South Carolinaenacted it after the date of the contract that was in effect at the time Hensonterminated his representation.6In opposition to Sylvania's constitutional defense, Henson asserts that the terms
 
IIof the parties' written contract was in effect only because the parties agreed toabide by these terms after Secs. 39-65-30 and 39-65-70 were enacted. He alsoclaims that the statutes are an exercise of the state's police power and that for that reason they are not subject to the Contract Clause.7The district court upheld Henson's contentions on both issues.8Ashwander v. Tennessee Valley Authority, 297 U.S. 288, 346-47 (1936)(Brandeis, J., concurring), reiterates that courts must not unnecessarily decideconstitutional questions. If a case can be decided by the application of generallaw, a court should forego deciding it on constitutional grounds. Adhering tothis precept, we will first consider Henson's claim that the Contract Clause doesnot apply. If this be so, we need not address the question of whether theContract Clause renders Chapter 65 unconstitutional with respect to the parties'contract.9South Carolina courts generally give effect to contractual choice of law clauses.See, e.g., Firestone Financial Corp. v. Owens, 419 S.E.2d 830, 831-32 (S.C.Ct.App.1992). Nevertheless, "[a] court, subject to constitutional restrictions,will follow a statutory directive of its own state on choice of law." Restatement(Second) of Conflict of Laws Sec. 6(1) (1971). Unless the Contract Clauserenders the South Carolina statutes unconstitutional, we have no doubt that aSouth Carolina court would follow the statutory directive of Sec. 39-65-70. Itwould hold that the provision in Henson's contract with Sylvania concerning theapplication of the law of Massachusetts is void insofar as it would render unavailable punitive damages and attorney fees.10In diversity cases a federal court must give effect to the conflict of law rules prevailing in the state where it sits. Klaxon Co. v. Stentor Elec. Mfg. Co., 313U.S. 487 (1941). Consequently, the district court was obliged to follow thechoice 'of law provision in Sec. 39-65-70 and apply South Carolina law to theissue of punitive damages and attorney fees as provided by Sec. 39-65-30,unless the Contract Clause intervened.11The Contract Clause provides: "No State shall ... pass ... any Law impairing theObligation of Contracts." U.S. Const. Art. 1, Sec. 10. The clause prohibits statesfrom impairing only existing contracts. In Allied Structural Steel Co. v.Spannaus, 438 U.S. 234, 242 (1978), the Court examined the limits the clauseimposes on "the power of a State to abridge existing contractual relationships."

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