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P A R T P A R T Foundations of American Law The Nature of Law The Resolution of Private Disputes Business and The Constitution Business Ethics, Corporate.

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Presentation on theme: "P A R T P A R T Foundations of American Law The Nature of Law The Resolution of Private Disputes Business and The Constitution Business Ethics, Corporate."— Presentation transcript:


2 P A R T P A R T Foundations of American Law The Nature of Law The Resolution of Private Disputes Business and The Constitution Business Ethics, Corporate Social Responsibility, Corporate Governance, and Critical Thinking 1 McGraw-Hill/Irwin Business Law, 13/e © 2007 The McGraw-Hill Companies, Inc. All rights reserved.

3 The Resolution of Private Disputes PA E TR HC 2 “In case of dissension, never dare to judge till you have heard the other side.” Euripides

4 Learning Objectives  State courts and their jurisdiction  Federal courts and their jurisdiction  Civil Procedure  Alternative Dispute Resolution 2 - 4

5  The United States has a federal court system and each state has a court system  A Court is established by a government to hear and decide matters before it and redress past or prevent future wrongs  Jurisdiction (the power to hear and speak) may be original (trial) or appellate (reviews trial court) The U.S. Judicial System 2 - 5

6 Federal Court Hierarchy  U.S. Supreme Court (appellate jurisdiction; final review and final decision)   Courts of Appeals (appellate jurisdiction)   District Courts (trial courts; original jurisdiction) or Statutory Courts (original limited jurisdiction), such as Tax Court, Court of Int’l Trade, Court of Federal Claims, etc

7  State Supreme Court (final appellate)   State Civil Court of Appeals and State Criminal Court of Appeals   District Courts (trial courts for civil matters over certain $ amount) and Criminal Courts   County Courts (trial courts for civil matters under certain $ amount)   Justice of the Peace Courts (small claims and misdemeanor courts)  Limited Jurisdiction Courts (i.e., family, probate, traffic, zoning) State Court Hierarchy 2 - 7

8  General jurisdiction courts (i.e., trial courts) hear most types of cases  Levels generally classified according to dollar amount of damages or location  Examples: county courts, district courts  Limited jurisdiction courts hear specialized types of cases and appeals from these decisions often require a new trial in a court of general jurisdiction  Examples: traffic court, tax court, family court General vs. Limited Jurisdiction 2 - 8

9  Subject-matter jurisdiction refers to a court’s authority to hear a particular type of dispute.  Courts of criminal jurisdiction hear trials of crimes and misdemeanors, which are offenses against the public at large  Courts of civil jurisdiction hear and decide issues concerning private rights and duties (e.g., contracts, torts), as well as non-criminal public matters (e.g., zoning, probate) Subject-Matter Jurisdiction 2 - 9

10  In addition to subject-matter jurisdiction, a court must have either in personam or in rem jurisdiction  In personam jurisdiction requires that the defendant be a resident of, located within, or have committed acts within the physical boundaries of the court’s authority In Personam or In Rem Jurisdiction

11  In rem jurisdiction applies when property that is the subject of the dispute is located within physical boundaries of the court’s authority  Example: a dispute over a house sale In Personam or In Rem Jurisdiction

12 Bombliss v. Cornelsen  Facts & Procedural History :  Illinois residents sued Oklahoma residents in Illinois court and the Oklahoma defendants moved to dismiss for lack of in personam jurisdiction  Trial court dismissed complaint and Plaintiffs appealed  Issue : Does the Illinois long-arm statute permit state courts to exercise jurisdiction over Oklahoma defendants?

13 Bombliss v. Cornelsen  Analysis and Application to Facts :  Defendant must purposefully avail himself of the privilege of conducting activities within the state such that he would reasonably anticipate being haled into the state’s court  Where a contract exists, minimum contacts shown by negotiations between parties, the course of dealing between parties, and foreseeable future consequences  Existence of a contract, defendants’ interactive website, and contact with potential customers of plaintiffs equate to minimum contacts  Holding : In personam jurisdiction exists. Trial court decision reversed and case remanded

14  Federal courts must have jurisdiction based on diversity or federal question  Diversity jurisdiction exists when the dispute is between citizens of different states and amount in controversy exceeds $75,000  Federal question jurisdiction exists when the dispute arises under the Constitution, laws, or treaties of the United States Federal Court Jurisdiction

15 Civil Procedure  A set of rules establishing how a lawsuit proceeds from beginning to end  In an adversarial system, the plaintiff bears the burden of proof to prove his/her case by a preponderance of the evidence  Once the plaintiff has made a “prima facie” case (i.e., proved the basic case), the burden of proof may shift to the defendant

16 Civil Pre-Trial Procedure  Action or event occurs allegedly causes harm   Injured party, known as Plaintiff, files a Petition or Complaint   Sheriff serves “process” (writ, notice, summons) on Defendant   Defendant Answers Complaint   Case proceeds to trial or settlement

17  Plaintiff’s complaint or petition plus the defendant’s answer or response are known as the pleadings  Defendant may enter a counterclaim against the plaintiff or a cross- complaint against a third party  Other parties may enter the case Civil Pre-Trial Procedure

18  Motion Practice: some motions ask the judge to decide the result before trial  Motion to dismiss (or demurrer)  Motion for judgment on the pleadings  Motion for summary judgment  Motions should NOT be taken lightly! Civil Pre-Trial Procedure

19  Discovery : Obtaining evidence from the other party through interrogatories, requests for admissions, requests for documents, and depositions  The discovery process can be a battleground  See Allstate Indemnity Co. v. Ruiz  Pretrial Conference: where the judge will hear and rule on many evidentiary issues, discovery disputes, and other concerns Civil Pre-Trial Procedure

20  Jury Selection (Voir Dire)  Opening Statement from each party Civil Trial Procedure

21  Plaintiff’s case through direct examination of witnesses (defendant performs cross- examination) and defendant’s case through direct examination (and plaintiff’s cross-examination) Civil Trial Procedure

22  Closing Argument or Summation from each party  Jury verdict Civil Trial Procedure

23  Trial motions include: motions in limine (motion to limit evidence), voluntary non- suit or dismissal (drop the case), motion for compulsory non-suit or summary judgment  After summation or closing argument, a party may move for a mistrial (overwhelming prejudice or injustice) or directed verdict (weight of evidence leads to only one conclusion) Civil Trial Procedure

24  Trier of Fact sees material evidence (physical objects, documents), hears testimony of witnesses (who provide factual evidence), and decides outcome of the case based on facts; trier of fact may be judge or jury  Matters of law are issues not of fact, but of law; matters of law decided only by a judge  E.g., whether a statute means X or Y, or one law or another applies to the facts Civil Trial Procedure

25  After the jury verdict, a party may make a motion for new trial, judgment non obstanto verdicto (notwithstanding the verdict) or J.N.O.V., or remittitur (defendant’s request for the judge to reduce the amount of damages the jury recommended; very common) Civil Trial Post-Trial Procedure

26  After a judgment has been entered, losing party may appeal decision to a higher court  After a judgment, winning party must have the judgment executed (carried out) to obtain money, property, or action ordered by the court  Bottom line: a judgment is issued and enforcement of the judgment begins Civil Trial Post-Trial Procedure

27 Point of Procedure  Not all dispute resolution mechanisms in the legal system are heard by a judge  Disputes with government often resolved by the relevant administrative agency  Administrative agencies generally have a unique dispute resolution process (hearings and appeals)  Also, disputants may choose alternative dispute resolution

28 Alternate Dispute Resolution  Arbitration : dispute settled by one or more arbitrators selected by the parties to a dispute; relatively formal; Uniform or Federal Arbitration acts typically used  Mediation : parties choose neutral party to aid resolution of dispute  Reference to Third Party : dispute resolution by rent-a-judge, minitrial, summary jury trial, or association tribunal

29  Less costly, in general  May be more appropriate method of resolution for certain types of cases (e.g., family law disputes, real estate disputes between neighbors, high-tech or trade-secret disputes)  May be required by clause in contract Why Choose ADR?

30 Test Your Knowledge  True=A, False = B  A trial court has original jurisdiction and an appellate court has appellate jurisdiction  The difference between general jurisdiction and limited jurisdiction is based on the amount in controversy (the damages amount)  Subject-matter jurisdiction refers to a court’s authority to hear a particular type of dispute

31 Test Your Knowledge  True=A, False = B  In personam jurisdiction refers to the court’s jurisdiction over the defendant, but in rem jurisdiction refers to the court’s jurisdiction over the property in dispute  The burden of proof solely rests on the plaintiff  Matters of law are determined by either the jury or the judge

32 Test Your Knowledge  Multiple Choice  Diversity jurisdiction refers to:  (a) a jury pool that reflects the ethnic makeup of the city  (b) a citizen’s lawsuit against the government  (c) a lawsuit by a citizen of one state against a citizen of a different state  Methods of alternative dispute resolution include:  (a) Mediation  (b) Arbitration  (c) Summary jury trial  (d) All of the above

33 Test Your Knowledge  Multiple Choice  Discovery refers to:  (a) the discovery that a dispute exists  (b) the pre-trial process involving interrogatories, requests for admissions, and requests for documents  (c) the analysis of fault in a dispute  After the verdict:  (a) Either party may make post-verdict motions  (b) The trial must end  (c) The trial begins

34 Thought Question  If you were served with a lawsuit, what would you do about it?

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