Business Law Ch. 2

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In Personam (over persons) jurisdiction

generally any particular court can exercise this over any person or business that resides within a specific geographical area. a state trial court, for example, normally has jurisdictional authority over residents/businesses that reside within a certain district or county. able to speak the law over persons or businesses residing in the given area.

In Rem (over property) jurisdiction

"jurisdiction over the thing." a court has power to decide issues relating to property, whether the property is real, tangible, personal, or intangible. generally has in rem jurisdiction situated within its geographical boarders. ex. a dispute arises over the ownership of a boat in a dock in Ft. Lauderdale, fl. the boat is owned by an Ohio resident, over whom the Florida court can not normally exercise in personam (personal) jurisdiction. the other party in the dispute is a resident of Nebraska. in this situation, the lawsuit concerning the boat can be brought in Florida court on the basis of in rem jurisdiction.

Exclusive vs. Concurrent Jurisdiction

EXCLUSIVE: case can be heard only in a particular court or type of court, such as a federal or state court. ex. federal courts have exclusive jurisdiction in federal crimes, bankruptcy, most patent and copyright claims, any lawsuits against the United States, some areas of admiralty law (governing seaborne transportation and ocean waters). state courts have exclusive jurisdiction over certain subjects such as divorce and adoption. CONCURRENT: both federal and state courts have the power to hear a case (diversity of citizenship and federal questions). a party can choose to bring a suit in either a federal or state court.

Diversity of Citizenship

federal district courts can exercise original jurisdiction over cases involving diversity of citizenship. most common type of diversity jurisdiction requires BOTH of the following: 1. plaintiff and defendant must be residents of different states. 2. the dollar amount in controversy must exceed $75,000. -for purposes of diversity jurisdiction, a corporation must be a citizen of both the state in which it is incorporated, and the state in which its principal place of business is located. -in case based on diversity of citizenship, a federal court will apply the relevant state law which is often the law of the state in which the court is.

Jurisdiction

in latin, juris means "law" and diction means "to speak." therefore, jurisdiction literally means "to speak the law." this is the power of the court to hear a dispute and "speak the law" into a controversy and render a verdict legally binding on the parties. before any court can hear a case, it must have jurisdiction over the person/company against whom the suit is brought about. must have jurisdiction over the subject matter as well.

Mediation

involves a neutral 3rd party 'mediator' who talks face to face with the parties in different rooms to establish a "common ground." they emphasize points of agreement and force parties to evaluate their options. although a mediator pay propose a solution, they do not make the decision resolving the matter. tends to reduce antagonism between parties which is why it is typically used in disputes between business partners, employers and employees, or other parties involved in long-term relationships. advantages: few rules, customize process, parties control the results (win-win). disadvantages: mediator fees, no sanctions or deadlines.

Judicial Review

judicial review was established by the supreme court in Marbury v. Madison. chief justice Marshall wrote "it is emphatically the province an duty of judiciary to say what law is." as the branch entrusted with interpreting laws, the judiciary can decide, among other things, whether the laws or actions of the other two branches are constitutional. this is in line with the system of checks and balances.

Venue

most appropriate location for trial, generally where the injury occurred. two state courts may have the power to exercise jurisdiction over a case. it may be more appropriate or convenient to hear the case in one court instead of the other. - concept of venue reflects policy that a court trying a case should be in the geographic neighborhood (usually county) where the incident occurred or where the parties reside. a. civil case: where defendant resides b. criminal case: where crime occurred. * pretrial publicity or other factors may require a change of venue to another community

Arbitration

most formal method of ADR. an arbitrator (a neutral 3rd party or panel of experts) hears a dispute mostly through reading party submitted information, and imposes a solution on the parties. the 3rd party makes a decision for the parties, and is usually an expert in the area. usually parties agree that the third party's decision will be "legally binding." in a nonbinding arbitration, the parties can go forward with a lawsuit if they do not agree with the arbitrator's decision. arbitrator's decision is called an "award." if parties agree, generally no recourse to courts. ex. NFL Player/Management issue or an auto contract.

Jurisdiction Over Subject Matter

refers to the limitations on the types of cases a court can hear. courts of GENERAL (unlimited) jurisdiction: can decide cases involving a wide array of issues. an example of this is the state trial court or the federal district court. courts of LIMITED jurisdiction: handle specific subject matters. for example, a probate court can only handle the disposition of a person's assets and obligations after a person's death, including custody and guardianship of children. a bankruptcy court can only handle bankruptcy proceedings which are governed by federal bankruptcy law. jurisdiction is usually defined in the statues or constitution that created that court.

Negotiation

simplest form of ADR. this is very informal, with or without an attorney, differences are discussed with the goal of "meeting of the minds" in resolving the case. attorney's typically advise their clients to negotiate voluntarily before they proceed to trial. if an attorney is present, they are advocates and are obligated to put their client's interests first.

Federal Court Jurisdiction

since the federal government is one of limited powers, the jurisdiction of the federal courts is limited. federal courts have subject matter jurisdiction in two situations: when a federal question is involved and when there is a diversity of citizenship.

Original and Appellate Jurisdiction

the difference between original and appellate jurisdiction usually lies in whether the case is being heard for the first time or not. original: heard for the first instance, where the case started (trial). where lawsuits begin, trials take place, and evidence is presented. in the federal court system, district courts are the trial courts. appellate: have power to hear an appeal from another court. act as reviewing. generally, cases can be brought before an appellate court only on appeal from an order or judgement of a trial court or other lower courts.

Judiciary role in American Government

the essential role of the judiciary-the courts- is to interpret the laws and apply them to situations.

Litigation

the process of resolving a dispute through the court system. this is expensive and very time consuming. litigating even a simple complaint is costly and several years may pass before a case is actually tried. for these reasons, more business persons are turning to Alternative Dispute Resolution (ADR) to settle their disputes.

Standing to Sue

the requirement that an individual must have a sufficient stake in a controversy to justify seeking relief through the court system. before he or she can bring about a lawsuit. the plaintiff must demonstrate that they have been injured or threatened with injury. a person can have standing to sue on behalf of another person, such as a minor or a mentally incompetent person. can be broken into three elements: 1. harm: party bringing the action must have suffered or will imminently suffer harm (an invasion of a legally protected interest). must be real and substantial instead of hypothetical. 2. causation: causal connection between the conduct complained of and injury. 3. remedy: must be likely and not merely speculative that a favorable court decision will remedy, or make up for, the injury suffered.

Alternative Dispute Resolution (ADR)

these methods are inexpensive, flexible, relatively quick, and give parties more control over the process. more than 90% of civil lawsuits are settled before trial using some form of ADR, many federal courts have instituted ADR programs as well. unless court ordered there is also no record, which is important in commercial litigation due to trade secrets. most common forms of ADR: negotiation, mediation, and arbitration.

The US Supreme Court

to bring a case to the supreme court, a party requests the Court to issue a writ of certiorari. a writ of certiorari is an order issued by the higher court asking the lower court for the record of a case. the court will not issue a writ unless at least four of the nine justices approve of it. most petitions for certiorari are denied. receives 10,000+ appeals a year, only actually hears 80-100 per year.

Long Arm Statutes and Minimum Contacts

used for non-resident parties based on "minimum contacts" with the state. defendant had some connection with forum state. for businesses, "minimum contacts" requires some business within the state. for instance, if an out of state defendant caused a car accident within the state or breached a contract formed there, a court will find that minimum contacts exist and exercise jurisdiction over the defendant. if a corporation advertises or sells its products within the state, or places its goods within its "stream of commerce" than it can be considered a minimum contact. (ex. Dude and Bubba, LL Bean, bandana's from San Diego)

Federal Question Cases

whenever a plaintiff's cause of action is based on the US Constitution, a treaty, or a federal law, a "federal question" arises. if a case involves a federal question, the case comes under the judicial power of the federal courts. a person who claims that their constitutional rights have been violated, can file the lawsuit in a federal court.


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