Clay (plaintiff) purchased an insurance policy from Sun Insurance Office, Ltd. (Sun Insurance) (defendant). Clay was an Illinois resident, and Sun Insurance was a British corporation doing business in Illinois, Florida, and other states. A clause in the policy required an insured to file suit against Sun Insurance within 12 months of a claim denial. Subsequently, Clay moved to Florida and transferred the insurance policy to his new residence. In Florida, Clay suffered a loss and filed a claim with Sun Insurance. Sun Insurance denied the claim. More than 12 months later, Clay sued Sun Insurance in federal district court in Florida. Sun Insurance argued that Clay’s suit was barred because of the clause requiring Clay to file suit on a denied claim within 12 months of the denial. Although the clause was valid under Illinois law, a Florida statute provided that the clause was void. The appellate court held that Florida law did not apply and entered judgment for Sun Insurance. The United States Supreme Court granted certiorari to review.