Business Law
Chapter 3 Outline: Court Systems
3-1: Forms of Dispute Resolution
Vocabulary:
Litigate: Place a dispute before a court of law for
resolution
Mediator: 3rd party brought into a dispute to develop a
solution for both sides. Decision is non-binding
Arbitrator: 3rd party who holds informal hearing to
determine what occurred. Decision is binding and
enforced by a court, if necessary
Court: Governmental forum that administers justice
under the law
Trial Court:
Verdict:
First court to hear a dispute
Decision in a court case
Original Jurisdiction: Original or first power to hear a
case
Appellate Court: Court that reviews decisions of lower
courts when a party claims an error was made during the
previous proceeding.
Transcript: Verbatim record of what occurred during a
trial
Appellate Briefs:
law
Written arguments on the issues of
Three Ways to Avoid Going to Court:
a. Negotiate a settlement with the other party yourself
b. Employ a mediator to try a get an acceptable solution
c. Employ an arbitrator to make a decision (must
follow)
How is a mediator different from an arbitrator?
Mediator recommends decision that both parties can
accept or reject. An arbitrator’s decision is binding and
must be accepted. Failure results in a court order
enforcing the decision.
2 disputes that courts hear:
1. Disputes between private individuals (Civil Law
cases)
2. Criminal Cases (Criminal Law)
2 Levels of Courts:
a. Trial Courts
b. Appellate Courts
Trial Courts consist of: Clerks enter cases on court
calendar, keep records of proceedings and compute court
costs. Sheriffs serve as bailiffs who summon witnesses,
keep order in court, and carry out judgments in state
courts. Marshals do same thing as bailiffs, but for
Federal courts. Juries are citizens sworn by court to
decide issues of fact.
Appellate jurisdiction is concerned only with… errors of
law that may have occurred at earlier trial
And not…determinations of fact (verdicts, etc.)
Is there a jury at appellate courts? No, only a judge
makes decisions. Judge reviews all files from earlier
trial, listens to arguments made by attorneys from both
sides, then renders a decision.
Decisions made by an appellate court:
a. Affirm the lower court’s decision (Uphold, agree
with)
b. Reverse (overturn)
c. Remand (send back down to trial court for corrective
action or new trial)
d. Any combination of the above
3-2: Federal Court System
Vocabulary:
General Jurisdiction:
Court can hear any type of case
Specialized Jurisdiction: Can only hear one specific type
of case
Writ of Certiorari: Order that “compels” the lower court
to turn over the record of the case to the Supreme Court
for them to review
Where does power to judge acts come from? It comes from
Article III of the Constitution.
3 Levels of Federal Courts:
1. Federal District Court: Has general jurisdiction; is
the first court to hear a dispute; and its power is to
determine the facts and make an initial determination of
the law to use in deciding the case.
2. Federal Courts of Appeals: Have appellate (think
“appeals”) jurisdiction over district courts, specialized
federal courts, and federal administrative agencies.
3. United States Supreme Court: Has original and
appellate jurisdiction (District Court and Court of
Appeals combined)
Federal District Courts:
They have “original” (first) jurisdiction over:
a) Federal questions or cases that arise under the
Constitution, U.S. Law, and Treaties; and
b) Lawsuits between citizens of different states, between
U.S. citizen and a foreign nation, or between U.S. citizen
and a foreign citizen. This is called “diversity of
citizenship”; more than $75,000 must be in dispute.
Federal Courts of Appeals:
Hear cases that are appealed to them by lower court; no
new evidence or witnesses called; review transcripts,
appellate briefs, and attorney arguments to make a
decision; CANNOT change jury determination.
U.S. Supreme Court:
First court to hear any case involving ambassadors, other
public ministers and consul from foreign countries. It is
the final appellate court to hear cases on appeal from
either the U.S. Courts of Appeals or from various state
supreme courts
How does the U.S. Supreme Court get jurisdiction over a
State Supreme Court case?
Hears cases on appeal from state supreme court only if a
“federal question” is involved.
How can U.S.S.C. decisions be overturned?
1. By itself making a different ruling
2. Constitutional amendment
3-3: State Court Systems
Vocabulary:
Court of Record: accurate, detailed report of what went on
at a trial. Very important for potential appeals
3 Tiers of Typical State Courts:
a. State Trial Courts
b. State Court of Appeals
c. State Supreme Courts
STATE TRIAL COURTS:
Have “general” original jurisdiction and can hear both civil
and criminal cases. Also known as circuit, superior, district,
or common pleas courts. These are the “Courts of Record”
for state trial system. Keep exact record of proceedings.
These courts also review courts of “specialized” jurisdiction,
like small claims courts, etc.
Usually a jury will determine the facts, if requested. If none
is requested, the judge will make the decision.
STATE COURTS OF APPEALS:
Appeals reviewed by a panel of judges, and follows
similar procedure to Fed. Court of Appeals. Reviews
previous court case, hears attorney arguments, no new
witnesses or evidence submitted. Can make a new
ruling or send it back down for new trial.
STATE SUPREME COURTS:
Panel of 3 or more Justices review appeals similar to lower
appeals courts. Issues final decision of question; if U.S.
Constitution or other Federal matter involved, it can proceed
to USSC. Also have original jurisdiction over State
impeachment cases.
State Courts with Specialized Jurisdictions:
a. Associate Circuit Court or County Court: Hear minor
criminal cases, state traffic offenses, and lawsuits with small
amounts of $ involved (<$25,000). Generally not a court of
record, but decision can be appealed to State Trial Court.
b. City/Municipal Court: Divided into traffic and criminal
divisions. Less serious violations go here and can be
appealed to trial court. These are not considered to be
crimes.
c. Small Claims Court: Handle disputes in which small
amount, <$2,500. Attorneys are not required; no juries, or
formal rules of evidence. Decisions can be appealed to trial
court.
d. Juvenile Court: Hold trials for criminal acts committed
by minors (age varies by state). Can be represented by
attorney. Emphasis is on rehab and not punishment.
Possible sentences include: Release into Parental, Guardian,
or Govt. supervision; placement in foster home; or detention
in facility.
Details are not public knowledge, court is closed,
records are closed. If serious enough offense, person can be
tried as an adult. Decisions can be appealed to circuit court.
e. Probate Court: Courts that administer wills and estates
of individuals who die. This is done according to will or
appropriate state law.