Article IV, Section 1:
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.
Garnishment proceedings combine some of the elements of both an in rem and an in personam action. Suppose that A owes B and B owes C, and that the two former live in a different state from C. A, while on a brief visit to C’s state, is presented with a writ attaching his debt to B and also a summons to appear in court on a named day. The result of the proceedings thus instituted is that a judgment is entered in C’s favor against A to the amount of his indebtedness to B. Subsequently A is sued by B in their home state and offers the judgment, which he has in the meantime paid, in defense. It was argued on behalf of B that A’s debt to him had a situs in their home state and furthermore that C could not have sued B in this same state without formally acquiring a domicile there. Both propositions were, however, rejected by the Court, which held that the judgment in the garnishment proceedings was entitled to full faith and credit as against B's action. 1