2-1 Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

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1• The Nature of Law

• The Resolution of Private Disputes• Business and The Constitution

• Business Ethics, Corporate Social Responsibility, Corporate Governance,

and Critical Thinking

Foundations of American Law

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The Resolution of Private Disputes

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“In case of dissension, never dare to judge till you have heard the other side.”

Euripides

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Learning Objectives

• Identify sources and types of law• Identify the law that takes precedence

when two types of laws conflict • Differentiate criminal law from civil law• Differentiate schools of jurisprudence • Describe the role of precedent (stare

decisis)• Explain major techniques of statutory

interpretation

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• 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

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• 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; appeals from decisions often require new trial in general jurisdiction court– Examples: traffic court, tax court, family court

General vs. Limited Jurisdiction

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• 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– Offenses against the public at large

• Courts of civil jurisdiction hear and decide issues concerning private rights and duties (e.g., contracts, torts), and non-criminal public matters (e.g., zoning, probate)

Subject-Matter Jurisdiction

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• Besides subject-matter jurisdiction, court must have either in personam or in rem jurisdiction

• In personam jurisdiction requires that defendant be resident of, located within, or acted within physical boundaries of the court’s authority

• In rem jurisdiction applies when property that is the subject of the dispute is located within physical boundaries of the court’s authority

In Personam or In Rem Jurisdiction

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• 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

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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 plaintiff has made a prima facie case (i.e., proved the basic case), the burden of proof may shift to defendant

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• Plaintiff’s complaint or petition plus the defendant’s answer or response are known as the pleadings

• Defendant may enter a counterclaim against plaintiff or cross-complaint against 3rd party

• Other parties may enter the case• Motion practice begins

Civil Pre-Trial Procedure

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• Discovery: Obtaining evidence from other party through interrogatories, requests for admissions, requests for documents, and depositions– Discovery process can be a battleground– See Allstate Indemnity Co. v. Ruiz

• Pretrial Conference: Where judge will hear and rule on many evidentiary issues, discovery disputes, and other concerns

Civil Pre-Trial Procedure

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• Jury Selection – Voir Dire or

Jury Questioning

• Opening Statement from each party

Civil Trial Procedure

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• Plaintiff’s case through direct examination of witnesses (defendant performs cross-examination) and defendant’s case through direct examination (and plaintiff’s cross-examination)

• Closing argument or summation from each party

• Jury verdict

Civil Trial Procedure

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• 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 (injustice or overwhelming prejudice) or directed verdict (weight of evidence leads to only one conclusion)

Civil Trial Procedure

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• 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

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• After jury verdict, a party may make a motion for new trial, judgment non obstanto verdicto (notwithstanding the verdict) or remittitur (defendant requests judge to reduce amount of damages the jury recommended)

• After a judgment has been entered:– Losing party may appeal decision to higher court– Winning party must have the judgment executed

(carried out) to obtain money, property, or action ordered by the court

Civil Post-Trial Procedure

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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

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Thought Question

• If you were served with a lawsuit, what would you do about it?