CHAPTER 3
Courts and Alternative
Dispute Resolution
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The Judiciary’s Role in
American Government
• The role of the courts in the American
government is to interpret and apply
the law.
• Through the process of judicial
review—determining the
constitutionality of laws—the judicial
branch acts as a check on the executive
and legislative branches of
government.
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Judicial Review:
Marbury v. Madison
• The power of judicial review was
established by Chief Justice John
Marshall in Marbury v. Madison, well
after the Constitution had established
the other checks and balances within
the federal government.
• What might result if the courts could
not exercise the power of judicial
review?
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Basic Judicial Requirements
Before a lawsuit can be brought before a
court, certain
requirements must first be met.
These include:
Jurisdiction
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Venue
Standing
to Sue
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Jurisdiction
• Before a court can hear a case, it
must have jurisdiction over the
person(s) against whom the suit is
brought or the property involved in
the suit, as well as jurisdiction over
the subject matter.
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Subject Matter
Jurisdiction
Limited
General
jurisdiction:
jurisdiction:
• Exists when a
• Exists when a
court is limited to court can hear any
a specific subject
kind of case.
matter, such as
probate or
divorce.
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Original vs. Appellate
Jurisdiction
Appellate
Original
jurisdiction:
jurisdiction:
• Exists with courts • Exists with courts of
appeals,
or
reviewing
that have authority
courts.
to hear a case for
•
Generally
appellate
the first time (trial
courts do not have
courts).
original jurisdiction.
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Federal Jurisdiction
• A federal court can exercise jurisdiction:
– When a federal question is involved (when
the plaintiff’s action is based, at least in part,
on the U.S. Constitution, a treaty, or a federal
law).
– When a case involves diversity of citizenship
(citizens of different states, for example) and
the amount in controversy exceeds $75,000.
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Diversity Jurisdiction
• Because of diversity jurisdiction, federal
courts spend a good deal of time deciding
issues that arise under state law.
• As federal courts become increasingly
overburdened with cases, some have
proposed to significantly limit (or eliminate)
diversity jurisdiction.
• Are the benefits of diversity jurisdiction
worth its costs to the federal court system?
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Exclusive v. Concurrent
Jurisdiction
Concurrent
jurisdiction:
Exists when two
different courts
have authority to
hear the same
case.
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Exclusive
jurisdiction:
Exists when only
state courts or only
federal courts have
authority to hear a
case.
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Exclusive v. Concurrent
Jurisdiction
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Jurisdiction in Cyberspace
• “Sliding Scale” Standard
Passive
Website
No
Depends
Yes
Substantial
Business
Interaction
• Case 3.1 Bird v. Parsons (2002).
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Venue
Venue has to do with the most
appropriate location for a trial, which
is usually the geographical area in
which the event leading to the dispute
took place or where the parties reside.
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Standing to Sue
• A requirement that a party must have a
legally protected and tangible interest at
stake sufficient to justify seeking relief
through the court system.
• The controversy at issue must also be a
justifiable controversy, one that is real and
substantial, as opposed to hypothetical or
academic.
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The State and Federal
Court Systems
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Trial Courts
Federal courts:
• Court of general
jurisdiction is the
U.S. District court.
• Courts of limited
jurisdiction include:
– U.S. Tax Court
– U.S. Bankruptcy
Court
– U.S. Court of
Federal Claims
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State courts:
• Courts of general
jurisdiction may be
called by a variety of
names.
• Courts of limited
jurisdiction include:
–
–
–
–
Divorce courts
Probate courts
Traffic courts
Small claims courts
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Intermediate
Appellate Courts
• Courts of appeals, or reviewing courts,
generally do not have original jurisdiction.
• Such courts in the federal system are called the
U.S. Circuit Courts of Appeals.
• The U.S. Courts of Appeals are divided into
twelve circuit courts (next slide) which hear
appeals from federal district courts located in
their jurisdictions. A thirteenth circuit, called
the federal circuit, hears appeals in certain
special types of cases.
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U.S. Courts of Appeal
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Supreme Courts
• Each state has a supreme court, although it may
be called by some other name, whose decisions
are final on questions of state law.
• Appeals from a state supreme court to the U.S.
Supreme Court is possible only if a federal
question is involved.
• The U.S. Supreme Court is the highest court in
the federal system and the final arbiter of the
Constitution and federal law.
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Following a State Court Case
A sample civil court case in a state court would
involve the following:
The
Pleadings
Pretrial
Motions
Discovery
Post trial
Motions
Trial
Pretrial
Conference
The Appeal
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The Pleadings
• Complaint:
– Filed by the plaintiff with the court to
initiate the lawsuit; served with a
summons on the defendant.
• Answer:
– Admits or denies allegations made by the
plaintiff; may assert a counterclaim or an
affirmative defense.
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The Pleadings
• Motion to dismiss:
– A request to the court to dismiss the
case for stated reasons, such as the
plaintiff’s failure to state a claim for
which relief can be granted.
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Typical Complaint
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Pretrial Motions
Motion for judgment on
Motion for summary
the pleadings:
judgment:
• Will be granted if the
• Will be granted if the
parties agree on the facts
parties agree on the facts.
and the only question is
The judge applies the law
how the law applies to
in rendering a judgment.
the facts.
• The judge can consider
• The judge bases the
evidence outside the
decision solely on the
pleadings when evaluating
pleadings.
the motion.
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Discovery
The process of gathering evidence
concerning the case. Discovery involves:
– Depositions (sworn testimony by a party or a
witness).
– Interrogatories (written questions by one
party towards the other made with assistance
from the attorneys).
– Various requests (for admissions, documents,
medical exams).
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Pretrial Conference
Either party or the court can request a
pretrial conference to:
– Identify the matters in dispute after
discovery has taken place, or
– To plan the course of the trial.
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Jury Selection
The jury selection process, also
known as voir dire, consists of
questions directed to prospective
jurors to assess potential bias.
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At the Trial
The typical course of a trial can be
diagrammed as follows:
Opening
Statements
Plaintiff’s
Introduction of
Evidence
Closing
Arguments
Defendant’s
Introduction of
Evidence
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Opening Statements
• An opening statement sets forth the facts
which the attorneys expect to prove
during the trial.
• Note that such statements are not
themselves evidence, but instead an
argument as to what the evidence will
show.
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Introduction of Evidence
• The plaintiff’s case may consist of relevant
documents, exhibits, and testimony of
witnesses.
• The defense is then given the chance to
challenge any of the plaintiff’s evidence and
cross-examine his witnesses.
• Unless a motion for a directed verdict is
made, the defense is then given a similar
opportunity to present its case.
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Closing Arguments
• After the defense concludes the
presentation of its case, the attorneys
present their closing arguments to the
jury.
• Attorneys use the evidence established at
trial to urge the jury to render a verdict in
favor of his or her client.
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Post Trial Motions
After a jury has rendered its verdict,
either party may make a post trial
motion. These include:
– Motion for judgment N.O.V.
(Notwithstanding the verdict) will be granted
if the judge is convinced that the jury was in
error.
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Post Trial Motions
• Motion for a new trial will be granted
if the judge is convinced that the jury
was in error, or there was newly
discovered evidence, misconduct by
the participants during the trial, or
error by the judge.
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The Appeal
• Either party can appeal the trial court’s
judgment to an appropriate court of
appeals.
• After reviewing the record on appeal, the
abstracts, and the attorneys’ briefs, the
appellate court holds a hearing and
renders its opinion.
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Enforcing the Judgment
• Securing a verdict does not mean there
are assets to pay the judgment.
• One of the primary factors to decide
before filing suit is whether the
defendant has resources or assets to pay
a judgment.
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Courts Adapt to the
Online World
• Courts are experimenting with
electronic media, including CD-ROMs,
electronic filings and docketing. Efiling is now an option in over 300
courts in Colorado.
• Virtual visitation rights?
• Case 3.2 Phansalkar v. Anderson,
Weinroth, & Co. (2004).
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Alternative Dispute
Resolution
• Alternative dispute resolution
methods differ in the degree of
formality involved and the extent to
which third parties participate in the
process.
• What is the primary difference
between negotiation and mediation?
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Negotiation and Mediation
Negotiation: The
parties come
together, with or
without attorneys to
represent them, and
try to reach a
settlement without
the involvement of a
third party.
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Mediation: The
parties themselves
reach an agreement
with the help of a
third party, called a
mediator, who
proposes solutions.
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Arbitration
• A more formal method of ADR in which
the parties submit their dispute to a
neutral third party, the arbitrator, who
renders a decision, which may or may not
be legally binding, depending on the
circumstances.
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Arbitration
• Some courts refer certain cases for
arbitration before allowing the cases to
proceed to trial; in most cases, this kind of
arbitration is nonbinding on the parties.
• Case 3.3 Buckeye Check Cashing, Inc. v.
Cardegna (2006).
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Employment Arbitration
• Courts generally hold that mandatory
arbitration clauses in employment
contracts are enforceable.
• Federal Arbitration Act excludes workers
in “interstate commerce.” Supreme Court
held that FAA applies to most employment
contracts. See Circuit City Stores, Inc. v.
Adams (2001).
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The Federal Arbitration Act
• The FAA provides the means for enforcing
the arbitration procedure that the parties have
established for themselves.
• The FAA covers any arbitration clause in a
contract that involves interstate commerce—
even where the business activities may have
remote connections or minimal effects on
interstate commerce.
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Online Dispute Resolution
• Negotiation Services.
• Mediation Providers.
• Arbitration Programs.
– Virtual Magistrate.
– Resolution Forum.
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